ML20246D912
| ML20246D912 | |
| Person / Time | |
|---|---|
| Site: | Vogtle  |
| Issue date: | 12/31/1987 |
| From: | Springs D SOUTHERN ENGINEERING CO. OF GEORGIA |
| To: | |
| Shared Package | |
| ML20246B150 | List: |
| References | |
| NUDOCS 8908280322 | |
| Download: ML20246D912 (176) | |
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. GEORGIA'iPOWER SUPPLY METHODOLOGY hj
- REPORT' 4
1 December 1987
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' Prepared by 1
i David A. Springs SOUTHERN ENGINEERING COMPANY I
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GEORGIA' POWER SUPPLY METHODOLOGY
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REPORT TABLE OF CONTENTS.
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I. Introduction and Summary II. Summary of Interviews with' Steering Committee Members (Objectives, Needs, and Goals)'
III. Assessment of-the Desired Relationship between the Parties I
b IV. Proposed Methodology 1.
Description of the Methodology 2.
Objectives of the Methodology 3.
Treatment of Capacity.and Energy Resources Responsibility Exchanges Distinction in treatment of types of resources (i.e. fossil, nuclear, conventional hydro, SEPA, pumped storage hydro, of f-system, etc. )
4 Miscellaneous V.
Evaluation 1.
Advantages and Disadvantages 2.
Satisfaction of Objectives, Needs and Goals of Each Party Exhibits A. Memorandum on interviews with Steering Committee Members B.
Partial draft of Georgia Power Supply Agreement C. Suggested procedure for categorizing hydro and pumped storage capability in the OSM methodology.
D. Objectives of the Parties mi______'__
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I. Introduction and Summary m
In'accordance with our agreements' dated June 22, 1987,'I haveLcompleted my review of the reports made available to me 3
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E of the various Working Groups' working toward the' establishment of theLGeorgia Power Supply arrangement to i
replace the present PR 'lariff.
I met a number of times with' K
fl the Project Management Team which directed-my effort.
Members of the Stratification Working Group made U
presentations and answered questions.
I was also allowed to y-interview each of-the' Steering Committee members separately.
At my request,.the Project Management Team and I met with-Energy Management Associates.-
i With'this background and considerable thought, I am prepared to recommend a basic conceptual methodology to replace the present PR Tariff.
I make the following recommendations:
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_(a)
Adopt as the basic conceptual methodology the Operations Simulation Method as contained in the
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Stratification Working Group Report-dated December 1986.
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(b)
Adopt a category equalization calculation which would allocate hourly all generation from Territorial units within a category to the participants in the category in proportion to the 1
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participants capability responsibility within the T
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Excess hourly energy of participants would be sold prorata to participants with deficit 1
hourly energy at the seller's highest energy cost l-in the category
-After such hourly' energy equalization is accomplished in each category, remaining participant excess or deficit energy b
would be sold or purchased at system Lambda.
(c)
Use category average forced' outage rates for all jointly planned and operated resources.
. (d)
Pumped storage and conventional hydro should be categorized based on operating results.
(See
' Exhibit C for suggested procedure.)
(e)
A specific item which should be studied is a transition period, possibly including a nuclear sub-category, for revenue impact absorbtion, if deemed necessary.
(f)
That the parties agree to commit themselves to a joint planning process including a commitment to own or purchase their proportionate share of incremental growth capacity, as generally described in Exhi, bit B.
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4 This' report contains a description of that methodology and reasons why I am recommending it over other possible methodologies.
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II. Summary of Interviews with Steering Committee Members
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Attached as Exhibit A to this report is a memorandum prepared by Ms. Linda Martinson of the Georgia Tech Research Institute who attended these interviews with me.
-These interviews allowed me to ask the Steering Committee members, separately,-the very basic questions involved in
~ attempting to put together a workable joint planning procedure.
Each party seems willing to commit to the process, if all other parties are willing to' commit.
III.. Assessment'of the Desired Relationship Between the Parties
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A reviaw of the work of the various working groups indicates a rather strong desire to find a way to make joint planning work.
There is hesitation on the part of each party, however, not knowing how it will work.
A substantial part of my support in selecting the Operations-Simulation Method is that it can adapt so well to the planning process and make joint planning an almost 3
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- methodical procedure.
With a_. good model, the methodology.
wil1Jprovide for testing and evaluation of alternatives including quantification of benefits and burdens to.be allocated-among parties.
This is especially valuable when considering1 adding pumped storage to the system (see IV-2 andLIV-3(c)).- This should' add a " warm fuzzy feeling" to all parties in knowing that alternative resources and ownership j
shares can be tested as to the impact on all parties.
Also,:
the methodology can be used as a vehicle for coordinating planning with the other Southern Companies. This implies a y
tigh,t joint planning process that commits-the parties to test alternatives and live with the results.
h.
If this kind of commitment to joint planning is going to be made by'the parties, there must be a common and consistent data base and load projection and a free flow of pertinent-information, with confidentiality, between the parties and between the Georgia Power. Supply system and the Southern.
Companies.
Early in my discussions with the Project Management Team there was concern.about the parties being able to commit to joint planning primarily because of the uncertainty of 4
exactly what the process would involve and whether all parties would be willing to commit to the process, both the inputs'to the process and the results.
After the separate 4
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that each Js definitely interested in an effective joint planning process.
GPC appears to be willing if OPC and MEAG-will commit to a joint data base and common and consistent V
load estimates.and commit,to the:results of the planning, including recognizing GPC's responsibilities'in the planning of the Southern Company.
OPC and MEAG. appear to be willing
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to commit to the process and its results if GPC and, in L
effect, Southern Company coordinate and cooperate with OPC-andlMEAG in allowing a relatively free flow of current b
information, with confidentiality, to allow them reasonable input to the process as it affects them.
As a result of the Project Management Team discussions and at their request, I have developed some draft contract language for your consideration in attempting to bring the parties together.
ThelatestdraftofthisisattachedasExhibitB.
Throughout the discussions with the Project Management Team and with the members of the Steering Committee, there seemed to be a feeling on the part of each party's representatives that his system needed some flexibility in the arrangement to allow for independent action if need be.
No one seemed to object to the concept of a party having the right to act
,.e independently if that party is prepared ~to be responsible for any appreciable negative impact on another party.
Exhibit B includes a draft of this concept.
Adopting the b
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' Operations Simulation Method will help make this concept-
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ii work in:that it will provide a rather methodical procedure ~
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- for. quantifying-benefits and burdens related to different-alternatives in'thw planning' cycle.- This would be J,
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- L accomplished by simulating unit commitments, dispatch', Land
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resulting categorization with-and'without.the alternatives.
E' Everyone should realize that if the parties adopt the joint
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. planning-and. operation procedures described'in Exhibit B,-
' practically ali future resources (other than'small resources-likecombastionturbines)willbejointlyownedandshared generally in accordance with growth capacity needs.' If the
$c parties are to commit to own their share of growth capacity 4
additions, each party must-be prepared to finance its share-
-in a timely manner.
MEAG apparently11s not a$le to guarantee financing;at a future date; therefore, they may_
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need an alternative to a blankat financial commitment in uthis planning process.
OPC may, also, but probably to a lesser extent.
GPC's financing structure is much more W
certain and flexible.
The joint planning agreement may provide-for the following:
6' (a)
When a deficit party demonstrates that it'is unable to finance its assigned capacity 6
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addition coming out of'the joint planning
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this capacity.
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The other parties sell and the. deficit party.
buys.this capacity es a unit power Q
transaction at cost with a reasonable return Lon investment for asperiod.of approximately 10 years.
The period should be flexible to-respond to planning cycles.
k (c)
At the end of the period, the deficit party again picks up the: responsibility for the same amount and type of capacity.
w-The draft of' Exhibit B refers to a separate " Article V" which.is intended to provide something like the above.
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The' relationship being described here is tight'and binding.
HOwever,-if the parties are willing to' commit to the process, the Georgia Territory will'be guaranteed the best possible power supply in the future.
" Competition" at the planning table will be in everybody's interest in arriving at the best plan'overall.- Competition otherwise wi.11 M
continue, in; marketing, public relations, efficient operations, etc.
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'IV. Proposed Methodology 1.
Description of the Methodology 8
Of the three basic concepts considered by the Stratification Working Group Report dated December 1986, I believe the j
i Operations simulation Method with refinements and continuing 6'
review towards improvements will serve the Georgia Power Supply participants best in the long run.
(See V. 1.
Advantages and Disadvantages).
r 2.
Objectives of the Methodology It was not necessary to dream up a fourth basic conceptual methodology.
You already have before you three workable methodologies from which to choose.
They all continue the C
concept of stratification which I believe is appropriate.
It was somewhat difficult for me to select between the Territorial Responsibility Method and the Operations l
Simulation Method because, in my opinion, either would serve very well over a 15 to 30 year period.
It is necessary to look very closely at how the two methodologies will respond to different resources over time and provide the most accurate basis for allocating benefits and burdens between parties when the resource mix of the parties are not the same.
8
Pumped storage is a good example.
Pumped storage is a system resource.
All pumped storage should be planned to fit the system.
In this case, the " system" is the total Southern Company, and it should be.
Yet, the use of pumped E-storage on a system affects every participant.
In this case not only GPC, OPC, MEAG and Dalton, but Alabama Power, Gulf Power, and Mississippi Power.
With the Operations Simulation Method, a very accurate quantification of benefits and burdens can be determined for allocation between user and owner.
This would be more difficult and less accurate with the Territorial Responsibility Method.
It could be possible to allocate benefits.and burdens between the Georgia Power Supply and the other Southern Companies through GPC.
In the joint pfanning process (See III above), this kind of coordination 5
would be very helpful in making joint planning decisions.
l The Territorial Responsibility Method does not offer this j
opportunity.
l The Operations Simulation Method responds to how the Georgia territorial resources' operate in the Southern Pool.
This will tend to affect categories depending on whether j
territorial Georgia is long or short in category facilities.
It is difficult to tell how this will affect cost allocations in the Georgia Power Supply system.
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- may be very small since'each party will be affected Proportionally.
Some analysis may be needed to reflect Southern Company' interchanges and determine whether adjustments are necessary.in categorizing the Georgia b
territorial resources.. This may be accomplished by production cost model runs separately dispatching and stacking the Georgia territory resources against Georgia h'
territory' load.
In spite of this possible need for' adjustment-I believe-the Southern Company representation will'be advantageous-in coordinating planning and. operations p:
eith tue other Southern Companies.
3.
Treatment of Capacity and Energy Resources C
Responsibility:
Capacity responsibility'would befas d'escribed.in the basic methodology; that is,-each party is responsible for its capacity needs.in each category..
A-party must sell excess category capacity to, and purchase deficit category capacity from, the other parties at average category cost.
Energy entitlement would flow with capacity purchases and sales at seller (s)' average category energy cost.
This-is a general statement.
Specifically, I am recommending the adoption of the basic Operations Simulation C'
Method and the following:
a.
Adopt a category equalization calculation which would allocate hourly 10 w
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all' generation from Territorial units k
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the-category in proportion to'the L
participantscapabilityresponsi$111ty N
within the category.. Excess hourly fly energy of participants would be sold-pp prorata to participants with_ deficit k:
hourly energy _at the seller's highest.
energy cost in the category.1 After such hourly energy equalization is accomplished in each category, remaining participant: excess or deficit energy would be sold or' purchased at system
-Lambda.
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b.
Use category average forced outage rates for all jointly planned and operated resources, c.
Pumped: storage hydro and conventional a
hydro should be categorized based on operating results.
(See Exhibit C for i
suggested procedure.)
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Exchanges:
Under the basic Operations simulation Method, there would be the category purchases and sales to equalize
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the' parties' capacity responsibility, and there would be the q
associatedjentitlementenergysalesandpurchases.- If'the-
' above-described category equalization calculation is installed, this would: amount.to an exchange of energy within
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each' category produced-by capability within each category.-
~ In other words,-each party would get backup energy from capability contributed'to forced outage reserves.
b There probably trill be purchases and sales of unit power
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planning process.
If such a sale fits the joint planning criteria (see III above), it should be. allowed.
g Distinction in Treatment of Resources:
The. Basic Operations.
Simulation Method describes how nuclear,. coal, oil, and gas-
~fired resources would be categorized._ Conventional hydro and' pumped storage hydro should also be categorized based on operating results.
SEPA-Hydro should also be categorized in the same way.
However, benefits to the preference customers under the current SEPA. contract must be reviewed prior to l
implementing this change.
Exhibit C describes a.possible approach to accomplishing hydro categorization.
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Pumped storsge, including Carters and Russell pumping, definitely should be treated as a system resource regardless
. of the owner.
The Operations Simulation Method provides a
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-Quantification of. benefits and burdens can be accurately-14 h
-determined for. allocation"between user and owner.
l' Off-system sales of firm capacity (SeefIII) would:be' removed from the. stack'and_ scheduled. 'Off-system purchases of firm
. capacity would be addedLto the stack and' scheduled in.
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transactions should.be approved in the planning process.
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Miscellaneous It should be expected that.the basic conceptual methodology
-will continue to be tested for improvements in its accuracy in allocating' cost responsibility and entitlement.
The aim o
should be tolkeep the' process as cost related as practical with respect..to unit operations and to maintain a high degree'of. risk sharing.
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V.
EVALUATION 4-F
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Advantagers and Disadvantages y
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(a)
Nuclear Sub-category Method' ADVANTAGES DISADVANTAGES
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(i)
Simplest method of (i) Would understate capacity accounting.
reserve cost, h
particularly base reserve.
(ii)
Similar to PR, cost.
therefore, familiar.
(ii) Category energy
.1 treatment is too 1
simplistic.
e (iii) May have some impact on.
-i revenue requirements, that is, the transition from PR will not be I
revenue neutral.
Direction of impact is 3.
4 unknown.
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(iv) Options are not equal A"
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among participants.
-(b)L Operations Simulation Method 2
ADVANTAGES DISADVANTAGES (i)
Will probably be the (i)
A new concept which most stable methodology will take time to get over'the years requiring used to and learn how to
'the least amount of use effectively.
S negotiating differences.
(ii)
Will result in an
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(ii) 'With slight impact on revenue modifications as requirements.
That is, described in IV-3(a),
it will not be revenue
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this method is cost
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related.
The direction of impact is unknown.
(iii)
Will. respond to operating constraints (iii)
May require adjustment such.as minimum loading, to recognize the i
. fuel supply.
interface between GPC and l
Southern Company.
g-(iv)
Would be the least complicated to administer.
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J(v)' Would.probably cause
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'the least, arguments in categorizing unit.
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((vi), Planning alternatives L'
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(c)- Territorial' Responsibility Method.
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'ADVANT4GES DISADVANTAGES o
(i)
Similar to PR, (i)
The unit stack has~had' therefore, familiar.
a tendency to be volatile.
due, primarily, to IIC
('11) 'Is the-most accurate in variable cost tying-resource cost to assumptions.
resource use.
y (ii)
May be considered q
g (iii)'
Will very likely cause unnecessarily
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. revenue requirements when.
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change is made from PR.
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- 9. :v (iv) 'Is based upon Georgia' territorial resources ~
-serving Georgia-territorial load.
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- 2. Satisfaction of. Objectives, Needs and Goals'of Each Party b
The Operations Simulation Method with' refinements should satisfy the objectives of.the parties as listed on pages 18, 19, 20, and 21'of the' Stratification Working Group Report.(See Appendix D) 5-except the " revenue neutral" objective of MEAG.
There likely will be some-shift in cost compared to PR when the new method is installed.
This is because of the.different makeup of the stratification categories which comes with the-change.
This does not mean that either method is wrong.
You vill not be able to tell which way' costs will shift, however, until it is-tested.
If the shift is substantial, some form of transition may be used.
g This may involve the use cf a nuclear sub-category.
One of MEAG's objectives was to find a solution to its problem of not being able to commit to financing at any particular time.
Hopefully, the suggestion under III at page 6
of this report
.will solve this problem.
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EXHIBIT A 4
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0-May 28,1987 Revised October 8,1987 MEMORANDUM 1
i TO:
Georgia Power Supply Project Steering Committee Members Project Management Team Members L.
FROM:
Linda Martinson and Dave Springs
SUBJECT:
Summary of meetings with Steering Committee Members t
During April and May Dave Springs of Southern Engineering, and Linda Martinson of GTRI held individual meetings with each of the three members of the Georgia Power p
Supply Project Steering Committee. The purpose of these meetings was to determine if the b ties had any individual organizational'and/or political constraints that might have implications for the rest of the project.
Our understanding of the intent of the Georgia Power Supply Agreement was explained at the_beginning of each meeting, i.e., that there would be a commitment by all
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parties to conduct joint planning, to assume responsibilities for a joint generation plan if such plan is demonstrated to be the most practical and economical option overall, and to assume an obilgation to buy deficits from or sell excesses to the other Parties and to share reserves / resources as adjusted through the IIC. This commitment implies openness of information, a joint and consistent load forecast and data base, and using the same model to estimate cost allocations and simulate costs for planning purposes.
MEAG and OPC retain their PR status, i.e., they are entitled to buy at average system cost until they become self sufficient. Each Steering Committee member was asked if he had any problems with this agreement. The ensuing discussion at each meeting is outlined below.
7 MEAG April 30,1987 Attending:
John Schlecht, MEAG Tom Loria, MEAG Dave Springs, Southern Engineering Linda Martinson, GTRI f
___ 1.
MEAG is vdinerable to change in tax laws -- they need to have flexibility so they cannot get in trouble with their method of financing.
3 2.
They want to preserve their PR status under the NRC; they want to preserve their tax exempt status; and they need to retain their right to buy average cost energy out of the system until they move toward self-sufficiency.
3.
They want to make the present methodology simpler. They want a sharing of reserves / resources and are willing to make growth capacity commitments although they may not be able to get to a resolution -- they may need a separate agreement tied to the general commitment in case they cannot get financing.
4.
They want a smooth transition to whatever new arrangements emerge, e.g., in interchange agreements. in terms of impact, they want a situation that is revenue neutral, i.e., they want the final result of the formulary pricing to come close to the original tariff.
5.
5ome cautions: a change in attitude may be necessary in terms of GPC toward Southern Company and there is a need to handle SEPA correctly.
Oglethorpe Power Corporation May 5,1987 Attending:
Stan Hill,,
OPC Dave Springs, Southern Engineering Linda Martinson, GTRI L
1.
OPC is concerned about a lack of progress with the project. They are willing to commit; they want to do the right thing by their members, i.e., plan for least cost with the most flexibility.
2.
There is a need to include Southern Company planning in a Georgia Territory plan but the question is how.
OPC (and MEAG) need Southern Company information to pian accurately and feel that a joint data base is an importart part of joint planning.
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With joint planning there is still a need to maintain areas of competitiveness, e.g., regarding mix -- it is necessary to have a good mix to compete with a
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company that has a good mix. A joint plan might help accomplish this.
y Competition is sometimes mainly at the planning table, however. Companies can also compete in marketing, management, and in spirit..
c.
h7 4.
OPC needs access, sharing, and input both in planning (power supply) and operations. A further constraint is that often they can operate only on a short-term basis.
Georgia Power Company May 18,1987 Attending:
Fred Williams,.CPC.
Dave Springs, Southern Engineering Linda Martinson, GTRI 1.
Concern was expressed about turning generation planning over to a committee.
- 2. - '
int planning should include a joint territorial forecast, i.e., one forecast with the same assumptions.
GPC is participating in a scenario approach to forecasting that produces high, medium, and low estimates. OPC, MEAG, and Dalton 'should be involved in the next scenario production process. With the
. separate forecasts being produced now there is some confusion, e.g.,
in
' overstating some loads that overlap. It would be better to produce one joint forecast and then modify it individually at the company level.
3.
' A. territorial agreement will necessarily be impacted by Southern Company planning. Georgia Territory will respond to Southern Company's planning and
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- this will put constraints on what GPC can do. For example, it cannot be put in a territorial plan that GPC will build a particular unit if this is contrary or not included in Soutnern Company's planning.
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GPC' supports the development of a long-term. agreement whdreby each b
' participant either commits to remain a customer or commits to supply at least its own needs through ownership or firm purchases. These commitments must be '
h binding and 'must relieve GPC of the burdens currently imposed by virtue of customers retroactively realizing benefits due to variations in actual loads or implementation of load control. If a party's commitments are insufficient to supply its resulting requirements, GPC will not be committed to provide for the
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. party's deficits under an embedded cost tariff.
5.
GPC feels competition is healthy.
p-Linda Martinson
- Georgia Tech Research Institute May 28,1987
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i REVISED DRAFT - December 1987 i
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I GEORGIA POWER SUPPLY AGREEMENT I.-
Definitions (to be developed)
II.
Joint Generation Expansion Planning s
2.01 Generation Expansion Planning Committee.
In 3
1 carrying out the terms of this Agreement, the Parties agree l
to coordinate planning in accordance with Prudent Utility S
Practices.
Each Party will appoint two members to the Generation Expansion Planning Committee.
Each member of the Generation Expansion Planning Committee shall be fully B
authorized to act on behalf of its Party with respect to all matters contemplated by this Article II but will not be j
authorized.to alter or amend the Agreement.
Each Party shall notify the other in writing of the names of the persons wno will serve as members of the Generation Expansion Planning Committee and, if desired, the names of 3
any persons who may serve as alternates when members are unable to act.
A Party's members may Ec changed at that Party's sole discretion from time to time by at least t e.a
.(10) days' prior written notice to the other Parties.
2.02 Meetings and Voting Rights.
Meetings shall be held at the discretion of the Generation Expansion Planning Committee but at least shall be held semi-annually.
Minutes i
of each meeting shall be kept and shall be approved by the Generation Expansion Planning Committee at its next subsequent meeting.
Decisions of the Generation Expansion 1
Ana
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fj PlanningLCommittee shall be made upon vote by the Generation b
Expansion Planning Committee.
If the decision is not unanimous, the Party or Parties may present separate-reports to the Executive. Committee for consideration under i
Section 2.06.
2.03 Duties of Generation Expansion Planning Committee.
(a)
To achieve greater reliability and economy of electric generation, the Generation Expansion Planning Committee shall meet periodically to consider in good faith joint planning of future generation facilities in accordance with thT provisions of Section 2.04 of this Article.
Each Party will keep the other informed of its future needs and plans, and any changes necessitated by altered needs and plans may be jointly studied to develop the plan of, additions to, or-alterations of, existing facilities that wfll produce the greatest benefits to all Parties as nearly
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as. practicable.
Each Party will supply the Generation Expansion Planning Committee all the information-required.to provide'the best obtainable results from joint planning and will coordinate the implementation'of any agreed upon plan for the development of generation and other facilities necessary to provide for reasonably economical and adequate service.
(b)
For the purposes of joint planning, Georgia Power Company's load forecasting model and procedure will be adopted by the Parties for combined territorial Georgia load 2
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- projections.. All Parties will havelinput to thisLprocess, hl
-The process will1 include.high, median, and low estimates:
with consistent assumptions.
Parties othec than Georgia Power Company.mayfuse=the same data sources:for consistency k,.
I n' forecasting their own loads to be used in' analyzing their i
participation ~in joint planning under this Article II.
Georgia Power. Company shall furnish the other Parties pL information and data in support'of alternative _ generation-expansion plans being considered by the Southern Companies-f for their next: official generation expansion plan as soon ai-such information and support data becomes available to Georgia Power Company.. This information and support data wil1~beltreated confidentially and used by:the Generation ExpansionLPlanning Committee to coordinate their planning with Georgia Power Company.
Georgia Power Company will', in good faith, represent the interests of:the Georgia Power-Supply l participants in the decision-making process: carried outuby'the Southern Company planners.
(c)
The Generation' Expansion Planning Committee-shall jointly evaluate-the growth of the territorial loads and the alternative plans for providing' sufficient capacity to serve these loads.
Except as provided in Article V of this Agreement, each Party will be responsible for providing for 6;
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its own growth capacity needs and may, after joint s,:*
' consideration of capacity needs for the' territory, pursue its'own' separate plan.for-expansion of generating facilities.
N.
2.04 Future Generation Planning.
The Parties each will
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consider-in. good faith the systems of all Parties together during the planning of future generation facilities so that N
~ the needs of each of.the Parties may be. included in.any plan for future expansion of those facilities.
Each Party will keep the other informed of its future needs and its future PT plans.as changes occur in current plans or as new plans are developed so that all Parties may pursue both joint and
' independent generation planning.
The Party pursuing an independent generation plan must demonstrate the impact, _or
. lack of impact, on the other. Parties.
If independent planning by a Party has a significant negative impact on
. another' Party, the impacted Party may claim' damages against
- the Party with the independent plan if such dama es can be
- clearly demonstrated and agreed to by the Generation Expansion Planning Committee, or such claim may be included in a separate report for consideration by the Executive Committ'ee under.Section 2.06.
The Parties agree to consider joint ownership of C
generatica resources in the future where reasonable net benefits will accrue to the Parties involved.
If a Party does not agree to joint ownership of a future generation 4
.1
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',{,:
resource,'the other Parties shall be free to pursue their b}
own separate plan for expansion of their systemis generation resources and will have no vetc over the plan of another Party with regard to that Ptrty's future generation resources.
The Party pursing a separate plan must demonstrate the impact, or' lack of impact, on the other parties.
If a-Party's separate plan has a significant g..
negative impact on'another Party,.the. impacted Party may claim. damages against the Party with the separate plan if such damages can be clearly demonstrated and' agreed to by I
the Generation Expansion Planning Committee, or such-claim-may be included in a separate report for consideration by the Executive Committee under Section'2.06.
2.05 Expenses cf the Generation Expansion Planning Committee.
Each Party shall. pay all expenses of its representatives.
Other expenses incufred in~ joint planning f
will be shared as agreed upon by the Generation Expansion-Planning Committee.
Any expense not agreed to unanimously.
by the Generation Expansion Planning Committee shall'be borne by the Party incurring it.
1 2.06 Resolution of Disputes.
If any dispute should arisa regarding the generation planning function that cannot be resolved by the Generation Expansion Planning Committee,
-the dispute and the circumstances surrounding such dispute 5
a u_
'a_
_..z
_i_
h, r-f x
l shall be. presented to.the Executive Committee for N'
. resolution.
It is the' intent of'the-Parties that' disputes
.will be resolved on-the basis of equity among the Parties.-
~
.III.-
Generation Responsibilities and' Entitlement Ltj (description of methodology with appendix).
' IV. -
Generation Operation 4.01 Generation Operating Committee.
In carrying out-b
.the, terms of this Agreement, the Parties agree to provide for reasonable-flexibility in scheduling generating resources into, out of, or within the Georgia Power supply 4
system; territory if such separate scheduling does not significantly impact the other parties or the members of the Southern Company other than Georgia Power Company.
Each Party will appoint a member'to the Generation Operating l Committee. Leach member of the Generation Operating-Committee shall be fully authorized to act on behalf of its Party with respect to all. matters contemplated by.this
,.y Article IV but will not be authorized.to alter or, amend the Agreement.
Each Party shall notify the others, in writing, af the name of the person who will serve as its member of
.the Generation Operating Committee and, if desired, the name of any person who may serve as alternate when.the member is not able to act.
A Party's member may be changed at that Party's sole discretion,.from time to time, by at least ten (10) days prior written notice to the other Parties.
6 e
. _ - _ _ _ ~ _. -
y l
4.02 Meetings and Voting Rights.
The members'of the w
[i iGeneration Operating Committee will likely be in touch on an almost daily' basis.
Meetings will be. held as needed atlthe
' request of'a member of'the Generation Operating Committee.
4
)
[
Agreement to' separately schedule a resource of a Party shall 3
l-be recorded by the Georgia Power Company member of.the.
Generation. Operating Committee.with copies distributed lto k
the other members-. When a meeting is necessary, minutes of
.j that'~ meeting shall be'kept and shall be distributed to all
~
members of the Generation Operating Committee'for approval.
1 Decisions of the Generation Operating Committee shall be made upon. vote by the Ceneration Operating Committee.
If the decision isnot unanimous, the Party or Parties may
.j
\\
present separate reports to the Executive Committee for i,
i consideration under Section 4.07..
4.03 Duties of the Generation' Operating Committee.
The Generation Operating Committee shall administer the monthly, weekly, or daily transactions among the Parties provided for under Subsections 4.04 and 4.05..
The Georgia Power: Company member of.the Generation Operating Committee shall in good
]
faith pass onto the Southern Company dispatcher instructions as to the dispatching or scheduling of Georgia Power Supply i
,l resources involved in transactions approved by the D
Generation Operating Committee or as instructed by the Escutive Committee in case of dispute under 4.07.
)
1 1
7
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{:
4.04 Generation Dispatch and/or Scheduling. ' Generally,.
- the Parties will submit their generatingLresources for 4
- economic dispatch within the Southern Company system.
However, under appropriate conditions, a Party.may.
s independently; dispatch a resource.
Accordingly, this section must-address issues such as the following:
E Terms and conditions under'which a party can request.' independent dispatch.
Party: requesting independent f
dispatch must prove no adverse
' impact on the other parties.
Resolution'of disputes and claims
'for' damages.
'4.05 Off-System Transactions..The Parties agree that
~
. under appropriate conditions-a Party'may become involved in off-system transactions with generating resources flowing into or outLof the Georgia Power' Supply' system territory.
Accordingly, this section must address issues such as-the following:
Terms and conditions under which a party can make off-system transactions; 3-
't e
e 8
e Treatment of off-system transactions in the
. Power Supply Agreement; Party requesting off-system transactions must prove no adverse impact on other parties; Resolution of disputes and claims for damages.
4.06 Expenses of the Generation Operating Committee.
Each Party shall pay all expenses of its representative.
Other expenses incurred may be shared as agreed upon by the Generation Operating Committee.
Any expense not agreed upon unanimously by the Generation Operating Committee shall be borne by the Party incurring it.
Any costs associated with redispatch or other studies performed by Southern company coordinators for a party shall be pa.* cy the party making the request.
4.07 Resolution of D'sputes.
If any disputes should arise regarding the activiey of.the Generation Operating Committee, the dispute and the circumstances surrounding such dispute shall be presented to the Executive Committee for resolution.
V.
Unit Power Transactions
-(See pages 6 and 7 of Report) 9
$; h I
- \\
n Treatment of off-system transactions in the
. Power Supply Agreement;
- L Party requesting off-system transactions must prove no adverse 3
i
'1 impact on other parties; l
Resolution of disputes and claims for damages.
b- '
4.06. Expenses of the Generation Operating Committee.
Each Party shall pay all expenses of its representative.
Other expenses incurred may be shared as agreed upon by the Generation Operating Committee.
Any expense not agreed upon unanimously by the Generation Operating Committee shall be borne by the Party incurring.it.
Any costs associated with
.redispatch or other studies performed by Southern Company coordinators for a party shall be paid by the party making the request.
,y 4.07 Resolution of Disputes.
If any-disputes should arise regarding the activity of.the Generation Operating Committee, the dispute and the circumstances surrounding such dispute shall be presented to the Executive Committee for resolution.
V.
Unit Power Transactions
, s (See pages 6 and 7 of Report) 3 i >
1 9
1 NL ' ' -
p.g-mi' f3
,s.
1.
EVI..
-Commitments
=This Article must' cover:
,..r NA
' Type of: Commitment for existing-load;*-
L participant' commits to remain a 1:
L customer of Georgia Power Company;
/E except participant may, through o
joint planning and mutual ~ agreement with: Georgia Power-Company, 7
construct additional generation facilities.to serve existing < load;
-Commitment'to serve future growth Y
- Construct. generating facilities
~
- Purchase if unable to construct.
~
- This requires a definition of " existing load".
VII..
Settlement'and Billing
.VIII.-
Accounting and Access to Records-IX.
Liability and Force Majeure X.
Term of Agreement
. XI. -
Filing with FERC XII.:
~ Default Plus other boiler plate o
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EXHIBIT C
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4 EXHIBIT C f
1 i'
'Suqqested Procedure for Categorizing Conventional Hydro and Pumped Storage Hydro Capabilit,y,in the OSM Methodology a,l 1.
The procedure starts with the annual load duration curve (LDC) for the territorial Georgia Power Supply (GAPS) y system.
Since this 11 an application of the OSM methodology to planning;and not to real time operating, the LDC shape should reflect average or median conditions (temperature, load factor, q
)
etc.).
s L
2.
This LDC shape would then be applied to the projected normalized GAPS system territorial peak load of the future year Ch to be studied.
. 3.
The procedure also needs an average'or median j
m, conventional hydro year for. planning. purposes.
The effort should I
be.to determine how. conventional hydro would actually operate to i
I carry load in the three categories of CSM along with all other s
resources available to GAPS.
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4.
The procedure also needs a determination of how 1
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available (or to be_available) pumped storage hydro would j
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, 'actually operate under average or median conditions along with j
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'all other reSourcOS aV&ilable to GAPS.
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'eferring to the attached sample on page 5 of this 5.
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Exhibit C, the LDC is for 1987.
The thermal resources and their j
operating results are as shown in the Appendix D - OSM of the
]
l Stratification Working Group Report dated December 1986.
(This includes Vogtle #2 and, therefore, will distort the categories somewhat.)
The hydro data has been prepared by OPC.
The two curves used in the sample are shown on pages 7 and 8 of this Exhibit C.
They represent the 88 hour0.00102 days <br />0.0244 hours <br />1.455026e-4 weeks <br />3.3484e-5 months <br /> running average operating levels coincident with the hours of the LDC.
The LDC is used as the base for determining how all resources including hydro and thermal actually would operate to serve load.
Other operation would be in a reserve or backup mode.
6.
Referring again to the sample on page 5 of this Exhibit C,
the curves represent the following:
~
Top Curve
= LDC Next Lower Curve
= LDC Less Hydro 4
Lower Curve
= LDC - Hydro - P.S.
Lower Curve
= Thermal Load Carrying Capability As illustrated on pages 5 and 6, the first category contains 6,576 MW of thermal load carrying capability (LCC), 200 MW of hydro LCC, and negligible pumped storage LCC.
The second category contains 4,890 MW LCC thermal, 500 MW LCC hydro and 150 MW LCC pumped storage.
All other resources would be in the third category and reserve.
2
s' 7.
The basic concept is to take the 1st category. thermal 1
' resources as determined by OSM, factor that capability down to s
LCC by'the weighted average equivalent forced outage rate (EFOR) i-of the 1st category resources.
The pumped storage LCC and hydro.
?
LCC to be assigned to the 1st category is the pumped storage operating level and the hydro operating level above the thermal LCC where the thermal LCC of the 1st category cuts the thermal o
LCC curve.
The 2nd category thermal capability (from OSM), is factored down to LCC by the weighted average EFOR of the 2nd category capability.- The pumped storage LCC and hydro LCC assigned to the 2nd category are determined by first locating n
where the sum of thermal LCC of categories #1 and #2 cut the thermal LCC curve, and then determining the pumped storage operating level at that point.
This, less the pumped storage LCC assigned to the 1st category, is the pumped storage LCC to be assigned to the 2nd category.
The hydro level at that point, less the hydro already assigned to the 1st category, is the hydro LCC to be assigned to the-2nd category.
The thermal LCC to be assigned to the 3rd category is J
determined by subtracting the thermal LCC of categories #1 and #2 from the peak of the thermal LCC curve.
The hydro LCC and pumped J
storage LCC to be assigned to the 3rd category are, respectively, J
the hydro level at peak less the hydro LCC already assigned to L
categories #1 and #2 and the pumped storage level at peak less the pumped storage LCC already assigned to the 1st and 2nd
)
Category.
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The thermal units to be assigned to the 3rd category are determined,by factoring down to LCC the thermal' capability not already assigned (by OSM).to the 1st and 2nd categories (thermal capability available for the 3rd category and reserves) by the weighted average EFOR of such capability..The thermal units in the 3rd category would be identified as those units or partial units with higher non load-cut percentage equaling the MW of capability determined as follows:
3rd category thermal capability (units)
(c) x-(a)
=
(b) where:
(a) = Combined thermal capability in 3rd category and reserves (b) = Combined thermal LCC in 3rd category and reserves (c) = 3rd' category LCC 9.
Hydro and pumped storage LCC for'each participant in each category would be determined through the same process.
10.
Since this procedure includes pumped storage generation, it should also include pumping of pumped storage.
The economics of pumping and operating pumped storage facilities is a separate analysis.
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6:
CATEGORY LOAD CARRYING CAPABILITY (LCC) FROM PAGE 5
??
First'Categoryr 6576 MW of Thermal LCC 200 MW of Pydro LCC-Neq. )Hd of Pumped Storage LCC Total 6176 MW of LCC Second Category:
4890 MW of Thermal LCC 500 MW of Hydro LCC 150 MW of Pumped Storage LCC Total 5540 MW of LCC D
. Third Category:
ll34'MW of Thermal LCC (12,600 - 11,466 = 1,134) 200 MW of Hydro LCC 350'MW of Pumped Storage LCC Total
-1684 MW of LCC D
6,776 MW LCC First Category 5,540 MW LCC Second Category 1,684 MW LCC Third Category 14,000 MW Peak-Load e
All capability not assigned to Categories #1, 2, or 3 go to reserves.
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1' August 8,.1989 Supplemental Response of Georgia. Power Company volume IV p
33.
Mr. G. Stanley Hill's March 7,-1988 letter to Mr.
- Fred Williams shows.that the subsequent " Principles of Agreement" was entered into by Oglethorpe voluntarily.
V 34.
The May 27, 1988 Principles of Agreement implement Mr. Hill's March 9, 1988 request.
35.
Oglethorpe's request' for the second Seminole transaction was made on June 8, 1988.
9l 36.
The agreement for the second Seminole transaction was filed with.the FERC on June 15, 1988.
37.
To the extent. Oglethorpe claims its second Seminole transaction was anything other than nonfirm, the E
relevant agreements show that the power was nonfirm at its inception, and was. subject to multiple contingencies.
Any' assurance of delivery made by Oglethorpe to Serainole resulted from. leaning - on Georgia-_ Power's resources, since Oglethorpe lacks i
sufficient generating capacity to serve its load.
38.
Georgia Power's July 21, 1988 offer to Oglethorpe'
~
would have enableri it to be self-suffir.ient.
'j Subsequently, Oglethorpe purported to disown all of l
.the discussions and agreements to date.
1 39.
On February 7,'1989, Oglethorpe telecopied this one page ultimatum to Georgia Power.
On its face it exceeds existing license conditions. requirements i
and transactions provided for by existing tariffs.
I It also makes unreasonable demands that would violate the license conditions, existing rate schedules and fundamental principles of utility operations.,
I l
l 3
)
p..
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Oglethorpe Power Corporation-March 9, 1988 2100 East Exchans. P'..
PO. B. 4.
Tucker. Georpa 3rn>
- Mr. Fred Williamiu Vice President Dulk Power Markets Georgia Power Company P. O. Box 4545 Atlanta,.. Georgia 30302
Dear Fred:
Subject:
. Oglethorpe Power Connaitment to Meet Future Needs During our discussions on February 19, 1988, and at the Joint Committee-for Planning and Operations on February 22, 1988, we discussed. future power supply arrangements in-Georgia.
You proposed,s on.behaJf of Georgia Power Company, two methods.
One for a:perty to commit.to become self-sufficient and the other m
was was a cossaitnent - to romain a Georgia' Power Company customer..
This'. letter is to. indicate Oglethorpe Power Corporation's intent to immediately begin working with Georgia Power. Company'to develop a
Power Supply-Agreement in which Og1ethorpe Power will. provide for its' future.-
'We would anticipate that'.this agreement would require that the parties develop'a Territorial Expansion Plan as-the basis for commitments and exchanges between the parties (this would' include-a.. territorial-load forecast also)' and'that 'each party would commit to provide -its share of territorial growth'
' capacity-when required.for territorial.needs.
For ia number ofcyears, Oglethorpe Power has been requesting that this. type of. arrangement be consummated. -We have already begun taking steps in. this direction 'by agreeing to construct and operate Eocky1 Mountain,-
by looking. at additional peaking requirements-in the 1990's. through combustion turbines-or-purchases. and through our attempts at the Joint Committee to prepare a Territorial Expansion Plan.
We would like to have this new Power Supply Agreement completed by November-1, 1988 and are prepared to dedicate the necessary resources to meet that goal.
Sincerely, G. St:nley Hill Senior Vice President System 2-
.,xt:cruer-
,7p[,i 3j Planning rn Q!
'GSH':sg w
. cc :, Mr.
F. F.
Stacy MAR - ' P '9 An Electne Membership Cooperative t
)
DRAFT FOR DISCUSSION PURPOSES ONLY l;
PARTT CONNITS TO BECONE SELT-SUTTICIENT MARCH 9,1984 k-1 L
33m&RI.QI.EQllEE. EZEELI. AGREEMENT L.
The new Power Supply Agreement will require the Farties to develop a territorial expansion plan as the basis for co/sitments and eschanges between the Parties.
Each Party will commit to provide its share of territorial growth capacity when required for territorial needs.
i The Parties will specify a maximum service obligation (GPC's Service Obligation) upon execution of the Agreement.
This obligation may be reduced only by mutual agreement.
Territorial categorization, each Party's category requirements, and
~
the categorization of GPC's Service Obligation will be determined c
from the energy budget and historical data, then fixed for each-year.
The Agreement will also provide for category exchanges between the Parties and territorial reserve equalization for approved territorial resources based on each Party's actual-seudF-load responsibility.
1 1
I I
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DRAFT FOR DISCUSSION PURPOSES ONLY PARTT CONKITS TO BEHAIN GPC's CUSTOKER MARCH 9,1988 y
~
ggggMI.QI.EQHEE. SUPPLY AGREEMENT The Customer will provide to GPC a forecast of its total future requirements and customer resources.
The Customer will commit to purchase its requirements from GPC except when the specified notice is provided that it intends to serve all or part of its requirements by providing a share of territory growth capacity when required for territorial needs.
Territorial categorization and the Customer's category requirements will be determined from the energ7 budget and historical data, then fixed for each year.
The Agreement will provide for full category equalization between GPC and the Customer.
The agreement will also provide for a reserve true-up for approved territorial resources based on the-Customer's actual peak load responsibility.
i 4
i
.F4jte _1 GPC's Custoser
I i
Oglethorpe' Power Corporation
{pS.3iV.Q l
1 5 f7 1988 t.
~
O. P.5 May 27, 1988 9~
Mr. R.W. Scherer Chairman i
Georgia Power Company l
P. O. Box 4545 Atlanta, Georgia 30308 Dear Bobs
Subject:
New Power Supply Arrangement Georgia Power Company and Oglethorpe Power Corporation are currently working on a new power supply arrange nent.
As a basis for beginning the detailed negotiations, we identified four
" Principles of Agreement" at our May 23, 1988 meeting.
Oglethorpe Power Corporation is committed to these principles.
PRINCIPLES OF AGREEMENT o-Each party will be responsible for its future growth' capacity.
To the extent either party plans to meet some of its needs with purchases from the other, those purchases will be made by firm contracts of fixed
. quantities and duration.
o Generation resources of the parties will be operated for the economic benefit of the Georgia territory.
o A territorial load forecast will be produced each year and this forecast will be the sum of forecasts made by parties responsible for serving the load growth in Georgia.
o Future resorrces will serve the needs identified by the territorial forecast.
We would like to have~the new " Power Supply Agreement" completed by November 1, 1988 and will dedicate the necessary resources to achieve that goal.
In any event, both parties agree to support these principles in our future relationships.
Irner Office An Electric Membership Cooperative
. o Mr. R.W. Scherer Page 2 May.27, 198E If the foregoing constitutes'a mutually acceptable statement of the agreement of both parties, please indicate your agreement by'-
signing the appropriate space below.
Sincere
~
F. F. Stacy President an<
Chief Execut'ive Officer FFS:sg cca Mr. G. Stanley Hill Mr. Grady Baker Mr. Fred Williams
/
DA_ D R.W. Scherer Chairman
~
Georgia Power Company F
__m___________.______
.__f,
___J
Y f ~~
b Oglethorpe Power Corporation _
2100 East Exchanne Place y _-
PO. Box 1149 Tucker. Georgia 300851349 (404)4 % N 00 June 8, 1988 g- -
-: e Mr. W. J. Smith d
Manager, Bulk Power Marketing g,... q Georgia Power Company 3
Post Office Box 4545 gK POWER Ausg3 Atlanta, Georgia 30302
~
Dear Bills This letter is to advise Georgia Power Company of Oglethorpe Power's intent to utilize the Georgia Integrated Transmission System (Georgia'ITS) to conduct interchange transactions with Middle South Services, Incorporated (SSI) and Seminole Electric Coope.tive Incorporated (Seminole).
Beginning June 10, 1988 and tentatively scheduled to end August 31, 1988, unless extended by mutual agreement, Oglethorpe Power will purchase up to 150 MWs of capacity and energy from SSI which will be delivered to the Georgia ITS via Tennessee Valley Authority (TVA).
In conjunction with this transaction Oglethorpe Power will bc selling up to 150 MWs capacity and energy to Seminole which is to be delivered to Florida Power Corporation (FPC) for Seminolo's account.
Specific operating details are as follows:
- Seminole shall be responsible for making all necessary arrangements for receiving the power and energy from the l
points of interconnection between the Georgia ITS and FPC.
- SSI shall be responsible for making all necessary l
I' arrangements for delivering the power and energy to the interconnection pointe between TVA and the Georgia ITS.
l
- Weekly schedules for the hourly transactions will be provided by Oglethorpe Power's System Operators to Georgia Power's and Southern Company Services' System Operators no later than 9:00 a.m. Central Prevailing time each Friday for the following week.
- Changes may be made during the term of a weekly schedule with twenty-four (24) hour notice being given Southern Company.
1 An Electric Membership Cooperative
= '
l l
Mr. W. J. Smith Page 2 June 8, 1988 l
In the event unforeseen circumstances occur requiring a
- schedule change outside normal business hours, Seminole may contact SSI's-System Operator's direct to make p
necessary arrangements. Seminole will-use their best efforts to keep last minute schedule changes to a minimum.
As evidenced below Oglethorpe Power is committed to entering into
' this~ transaction on June 10, 1988 and Georgia Power Company g
is hereby requested to. expeditiously facilitate the means to accommodate this endeavor.
Sinc
- ely, M
I Douglas 4.Calvert DHCadth cca Mr. F. F. Stacy Mr. G. Stanley Hill 46 4 o
Tom D. Kilgore Senior Vice President, Power Supply l
1 m
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.,,,; j.hin d caste:masseno 1984 R 8 8 - 4 6"'6 m W Ww June 14,
~_
-Honorable Lois D. Cashell Acting Secretary Federal Energy Regulatory Commission 825 North Capitol Street, N.E.
Room 1000 Washington, D.
C.
20426 Re:
Georgia Poker Company - Oglethorpe Power Corporation Scheduling Services Agreement
Dear Secretary Cashell:
Enclosed for filing on behalf of Georgia Power Company
(" Georgia Power") are six conformed copies of a
Scheduling Services Agreement
(" Agreement"),
dated as of Juhe 13, 1988, between Georgia Power'and Oglethorpe Power Corporation (An Electric Membership Generation i
Transmission Corporation)
("OPC").
The Agreement has been executed to facilitate a short-term, non-firm capacity and energy transaction between OPC and Seminole Electric Cooperative, Inc. (" Seminole").
From Georgia Power's standpoint the Agreement constitutes an initial rate schedule and is being filed i
pursuant to section 35.12 of the Regulations (18 C.F.R.
5 35.12 (1987)).
Service under the Agreement may commence as early as the date of this
- letter, and, q
accordingly, Georgia Power respectfully requests waiver, pursuant to 18 C.F.R.
S 35.11 (1987),
of the notice requiret.ents contained in 18 C.F.R.
S 35.3(a)
(1987),
so that the Agreement may become effective as of June 14, 1988.
Copies of this filing have been delivered to
- OPC, 2100 East Exchange
- Place, Tucker, Georgia 30085-1349.
Description of _ Service and Charges.
During the period June 14, 1988 through November 1,
- 1988, OPC proposes to sell to Seminole up to 150 mW of non-firm capacity ar' associated energy which it is purchasing from Middle South Utilities.
Seminole is located in I
ITCCUT::
SANDERS LOCNCCMAN & ASHMO3C AN
,.. w.m co Honorable Lois D. Cashell June 14, 1988.
F Page Two or adjacent i to the Florida Power Corporation
("FPC")
control : area.
The - deliveries will assist Seminole ~ in meeting its: service' obligations during the outage of
,A its-Seminole Unit No.
- 1.. Pursuant to ' the Agreement, Georgia-Power (through its. agent Southern Company
' Services, ' Inc. ).
-will schedule the delivery' by OPC '. to FPC atL the Georgia _ - Florida state line.
Although the power may actually enter :the Southern system control area. at various of Southern's interconnection points I
with Middle. ' South and TVA, OPC deems its purchase to occur:at the Georgia Power - Tennessee Valley Authority
(
interconnection in north Georgia.
In any event, within the state.of Georgia, OPC will be deemed to have.trans-mitted the power to the FPC delivery point pursuant to its participation in Georgia's Integrated Transmission e
System (Georgia Power's FERC Electric. Tariff, Original
- Volume ~ No.
3).
The OPC Seminole transactions will
-be scheduled in a
manner similar to economy energy transactions between the Southern electric system and-FPC.-
OPC will pay Georgia Power a scheduling. and coor-dination fee of $20.00 per hour fos each hour during
_which deliveries are scheduled. under the' Agreement to compensate for all. costs, including scheduling, coor-dination and accounting.
Miscellaneous.
Given the. unpredictable nature of the sales proposed by OPC to be scheduled' under ' the L
Agreement, Georgia Power cannot. estimate with any reasonable degree of accuracy the transactions which might take place under the Agreement.
Georgia Power respectfully requests. waiver of any of the Commission's filing requirements deemed not to be satisfied by this filing letter and the Agreement itself.
Georgia Power does not provide any similar service to other customers and is not installing any new utility facilities in order to provide service pursuant to the Agreement.
As set.forth in section 3.1 of the Agreement, OPC and Georgia Power intend for the Agreement to terminate at midnight on November 1, 1988.
Furthermore, OPC agrees in section 2.7 that it will not seek to schedule any transactions"under the Agreement after November 1, 1988.
Accordingly, since the effective period of the Agreement
,TCOU.TM AN, $A%DC%$, LCCMC5;MAh ASHMO%C
s=
sween = co owe Honorable Lois D. Cashell June:14,;1988 Page Three j
y; is barely,'. longer than the notice period for filing a notice.. of - ' termination ' or cancellation, Georgia-Power requests that the-Commission' order accepting lor approving.
4~
the Agreement expressly state - that the Agreement. will terminate on November 1,
1988, and that _ Georgia Power is excused-from filing any additional notice thereof.
' Formal communications concerning this filing should be addressed to:
i Mr. Fred D. Williams Vice' President - Bulk Power Markets Georgia Power Company P. O. Box 4545 Atlanta, Georgia 30302 404/526-6526 and to' counsel:
Robert H. Forry, Esquire Troutman, Sanders, Lockerman & Ashmore i
1400 Candler Building Atlanta, Georgia 30043 404/658-8000
~
l It is requested that questions concerning the filing or any requests for additional information be directed ~
L to.the undersigned at his law firm address or telephone number set forth above.
Enclosed is a check in the amount of 55,780.00 to. cover the filing - fee _ required by 18 C.F.R. S 381'.502, pursuant'to Order No. 494, issued April 6,
1988.
Also enclosed is a form of notice for publication in the Federal Register.
Yo ery tr ly, A
R be t H. Forry 6
RHF/dwe Enclosures l
COORDINATION SERVICES AGREEMENT This Agreement is made and entered into as'of this G day of June,1988, by and'between GEORGIA POWER COMPANY,a company organized and existing under the laws of_the State of Georgia
("GPC") and OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP GENERATION AND TRANSMISSION CORPORATION), an electric membership corporation organized and existing under the laws of the State of Georgia ("OPC") (individually a " Party" or collectively the
" Parties").
WITNESSETH:
.01 WHEREAS OPC desires to purchase capacity and energy from Middle South Utilities pursuant to an agreement between OPC and Middla South Utilities dated June 3, 1988, and simultaneously sell capacity arid energy to Seminole Electric Cooperative
(" Seminole") pursuant to an agreement between OPC and Seminole, dated June 13, 1988 and
.02 WHEREAS Tennessee Valley Authority ("TVA") will deliver power to the TVA-Georgia border for OPC's account, and l
.03 WHEREAS OPC has requested that GPC make arrangements for the receipt and simultaneous delivery of capacity and energy to 1
f
g.
p.
Florida _ Power Corporation ("FPC") for Seminole's account utilizing the Integrated Transmission System ("ITS") to accomplish such simultaneous receipt and delivery, and I'
.03 WHEREAS the Parties agree that OPC's utilization of the ITS for the purpose ~of-implementing the simultaneous purchase and sale of capacity and energy shall neither be nor establish a
)
precedent concerning the future use of the ITS.
NOW THEREFORE in consideration of the premises and the mutual agreements herein-set forth, GPC and OPC hereby agree as follows:
ARTICLE I Scheduling of Energy 1.1 Actions by GPC.
Actions identified herein as being accomplished by GPC may be accomplished either by GPC or its 1
agent.
l l
1.2 Recelets and Deliveries.
GPC will, subject to the terms and conditions of this Agreement, schedule receipts of capacity l
and energy from TVA and deliveries of capacity and energy to FPC
]
for the account of Seminole in the quantities and at the times specified herein.
Capacity scheduled hereunder shall not exceed
)
l 150 Mw.
2 1
1
p s
1.3 Delivery Point.
The Delivery Point for all energy delivered to FPC for Seminole's account pursuant to this Agreement is deemed to be the FPC interconnection points with the b
ITS at the Georgia-Florida state line, and transactions hereunder are contingent upon FPC's ability to accept the power.
1.4 Schedulina.
In order to arrange for the appropriate scheduling of capacity and energy pursuant to this agreement, beginning with the date of the Agreement and each Friday (or last non-holiday weekday of the week) thereafter, by 9:00 a. m.
Central Prevailing time of each such day, OPC shall provide GPC (or its agent) with a requested hourly schedule of energy receipts from TVA for OPC's account for each day of the forthcoming week, such week being defined as the seven-day period beginning at 0001 a. m. Monday, Central prevailing time. This notification can be verbal provided it is followed by written confirmation from OPC to GPC. In addition, on each weekday of the following week, OPC shall provide GPC (or its agent) an hourly schedule for the following day.
GPC will determine the availability of the transmission system for the simultaneous delivery of energy to FPC and notify OPC of limiting conditions, if any.
On the latest non-holiday weekday prior to each day's actual delivery, GPC will determine for the original schedule (or revised schedule if OPC was notified of limiting conditions and 3
?
V' l
)
accepted a. revised schedule based on such limitations,:such acceptance hot to be unnecessarily withheld) an hourly delivery j
schedule to FPC for Seminole's account equal to the hourly receipts:from TVA less incremental losses as determined in Section 1.5 herein.
GPC will actify CPC of this hourly delivery schedule and this schedule will become the Actual Delivery Schedule upon acceptance by OPC.
?
1.5 Losses.
GPC will make a projection of incremental
~
losses for each hour of the projected period using existina algorithms.of the Southern Companies. Losses shall not La less r~
than zero.
The total incremental losses thus determined for each' hour.of the projected period will be converted to average incremental losses for a minimum of two time periods per day.
Q These two periods will consist of the hours beginning at 7:00 a.
- m. and ending at 10:00 p. m. prevailing Central time designated as the peak period, and the hours beginning at 10:00.p. m. and ending at 7:00 a. m. prevailing Central time designated as the valley period.
CPC reserves the right to-review the determination of the incremental losses.
l t
1.6 Limitino Conditions.
In the event a condition occurs on I
the Georgia-Florida interface which-requires the limiting of transactions, deliveries to FPC for Seminole's account hereunder will be interrupted prior to the interruption of deliveries under 4
. _ _ = _.
V' Agreements of the Southern Companies for Unit Power, Unit Power Replacement', Supplemental, and Alternate Energy and Long. Term Non Firm Sales, Schedule EP and Assurred Economy Sales.
In the event a limiting condition occurs in the state of Florida, FPC will b
determine the priority of transactions at the time of the limitation.
In the event a limiting conditicn occurs in the TVA system, TVA will determine the priority of transactions at the b
time of the limitation.
i L
1.7 Instructions.
Prior to Scheduling any transactions hereunder, OPC shall arrange for GPC (or its agent) to be provided with written instructions approved by each of the Florida utilities affected by transactions over the Southern system-Florida interface, setting forth Florida's characterization of the OPC-Seminole transactions to be implemented hereunder, the priority of such transactions in
~
relation to other Southern system-Florida transactions, and any other special scheduling instructions cr considerations.
For purposes of this section Florida utilities shall include, without limitation, Florida Power & Light Company, Jacksonville Electric Authority, Florida Power Corporation, and the City of
~
Tallahassee, Florida.
OPC will similiarly arrange for GPC (or its agent) to be provided with written instructions approved by TVA for transactions within the TVA system.
5 I
m
b-1.8 Curtailment.
The delivery of capacity and energy
)
hereunder will be curtailed or discontinued to the extent that the supplying source is curtailed or discontinued, or that transmission limitations occur.
1.9 Arrangements.
OPC will make necessary arrangements, including obtaining agreement of all entities, for FPC to be the point of contact for communication:s with GPC's agent regarding scheduling curtailment or changes to deliveries of capacity and energy heraunder.
1.10 Schedule Chances.
OPC will give GPC at least four hours notice for any requested schedule change.
Changes will be made to the extent they can be accommodated by GPC, but GPC will t
have no obligation to implement changes that conflict with Southern transactions.
l ARTICLE II Administration 2.1 Records.
GPC shall keep and provide to OPC records sufficient to identify hourly energy transactions hereunder, causes and timing of any limiting conditions, and events associated with any unusual occurances concerning the 6
~
l
._L--x-----.-__
---.5
1 b
transactions.
2.2 Schedulina Fee.
OPC shall pay to GPC a scheduling fee 1
of $20.00 per hour for each hour which has an Actual Delivery i
Schedule under this Agreement.
1 1
2.3 Development costs.
OPC shall reimburse GPC for all of
~
Southern Company Services' initial developmental costs, including j
appropriate overheads, associated with this Agreement, programming changes to Southern's on-line Power Management System, modification of billing procedures and programs, and administrative efforts to formulate and implement this Agreement.
These costs are $19,500.00.
2.4 Billina and Pavmant.
By the tenth working day of each month, or as soon thereafter as practicable, GPC will provide CPC with an invoice containing the amount due GPC for dispatching services pursuant to Section 2.2 herein.
OPC will make payment for invoices rendered hereunder within fifteen days of receipt.
2.5 ITS Responsibility.
The Parties agree that deliveries of capacity and energy to FPC for Seminole's account may increase OPC's responsibility under the ITS by creating a new annual peak for'OPC.
This responsibility will be accepted by OPC.
7
y,7 2.6 Indemnification.
OPC agrees to indemnify'GPC.and save GPC harmless from any. claim whatsoever brought by seminole, another Florida utility, TVA, an ITS participant, or any othe'r party resulting from GPC's performance hereunder;
- provided, 5
however nothing contained herein shall' relieve GPC of the consequence of its negligence or of any breach of this Agreement.-
s-2.7 Raaulatory Anerovals.
The Parties recognize that this j
i contract is required to be filed with and approved by certain regulatory agencies including the Federal Energy Regulatory Commission ("FERC").
To this and GPC agress to take steps promptly to file this Agreement with the T'ERC and shall' seek a waiver of the notice requirements of the Federal Power Act and Section 35.3 of FERC regulations with the effective date of this Agreement.
In the event this Agreement is changed or modified by any regulatory agency or authority, either Party, if adversely j
affected, shall have the right to terminate this Agreement immediately.
In the event of such termination, OPC agrees to reimburse GPC for developmental costs pursuant to Section 2.3 herein, and pay any scheduling fees incured to the point of termination.
Furthermore, OPC will take all steps reasonably requested by GPC to obtain FERC acceptance of the termination date of this Agreement specified herein. OPC will reimburse GPC for all costs incurred in obtaining required regulatory approvals.
In any event, OPC agrees that neither it nor Seminole 8
l
=
1 1
i will seek to have any transaction scheduled under this Agreement after Novem"ber 1, 1988.
a 2.8 Uniaue circumstances.
The Parties agree that the w
~
circumstances leading to this Agreement are unique and that this Agreement therefore establishes no precedent for any other services and will not be relied upon by either Party for any purpose other than for the services and payment provided for hereunder.
I 2.9 operatina Committee.
GPC and OPC shall each appoint one 1
representative and one alternate to act for it in matters J
pertaining to the interconnected operation of its system
]
hereunder and the detailed operating arrangements for receipt and delivery of capacity and energy hereunder.
The two j
representatives, or their alternates, shall comprise the Operating Committee.
Evidence of such appointments shall be given by written notice to each of the Parties, and such appointments may be changed at any time by similar notice.
ARTICLE III Miscellaneous 3.1
, Term This Agreement shall become effective as of the 9
U 6
_.. = _. _-
.=_-_-_____--a
e
[
date first appearing above, and shall terminate at November ~1, 1988.-
3.2 Force Maieure.
The term " Force Majeure" shall mean acts of God, the enforcement or adoption of legislation or lawful rules,-regulations or orders of any governmental body, acts of a public' enemy, riots, strikes, or other industrial disturbances, 1
~
labor or material shortages, fires, explosions, breakdowns of or damage to generating plants, structural failure of-facilities, or other causes of a similar nature which are beyond the reasonable control of GPC or OPC and wholly or partly prevent GPC or OPC L
from performing its obligations hereunder. :If because of Force 4
Majeure either GPC or OPC is unable to carry out its obligations under this Agreement, and if such Party promptly gives the other Party hereto written notice of such Force Majeure, specifying the nature, extent, and expected duration of such Force Majeure, the obligations and liabilities of the Party giving such notice and q
the corresponding obligations and liabilities of the other Party
~
shall be suspended to the extent made necessary by and during the continuance of such Force Majeure.
3.3 Notices.
Any otices, billing information and invoices required by this Agreement shall be deemed properly given if mailed postage paid, to Oglethorpe Power Corporation, 2100 East Exchange Place, P. O.
Box 1349, Tucker, Georgia, 30085-1349.
10
L Attention: _ Manager, Power Contracts in the case of OPC, and to Georgia Power Company, 333 Piedmont Avenue, Atlanta, Georgia 30308, Attention: Manager, Bulk Power Marketing Services 333/20, in the case of GPC.
a
'I 3.4 Transfers and Assians.
OPC shall not transfer or assign-i its rights and obligations under this Agreement without GPC's prior written consent.
The terms of this Agreement shall be binding upon the Parties, their successors and assigns.
IN WITNESS WHEREOF, the Parties hereto have duly executed this Coordination Services Agreement by their duly authorized representatives as of the date first above written.
e 11 v
)
"GPC" GEORGIA POWER COMPANY By:
b Fred D. Williams ts:
Vice President Bulk Power Markets y
-u (Title)
"OPC" r
OGLETHORPE POWER COPSORATION (AN ELECTRIC MEMBERSHIP GENERATION & TRANSMISSION c o g
.b h
Its:
cy President and er Executive officer WITNES T:
By:
'I s%s/
5uwY/
(Title) 12 1
u_.___m__
n p
L c
UNITED STATES OF AMERICA FEDERAL ENERGY REGULATORY COMMISSION
,b Georgia Power Company
)
Docket No.
(
l Notice of Filing
- 1 q.
r k
Take n o't i c e. t h a t on June 15, 1988, Georgia Power Company-(" Georgia Power") tendered for filing a Schedul-ing Services Agreement (the
" Agreement")
dated. as of June 13,
- 1988, between Georgia Power and Oglethorpe i
Power Corporation (An Electric Membership' Generation
& Transmission Corporation) ("OPC").
}
Georgia Power states that the Agreement has been j
executed to 'f acilitate a short-term,- non-firm capacity i
' and energy transaction between OPC and Seminole Electric
)
Cooperative, Inc.
Georgia Power seeks waiver of the
]
Commission's notice requirements and seeks an effective 1
~date of ' June 14, 1988.
The Agreement will terminate l
on November 1, 1988.
Any person desiring to be heard or to protest said application should file a motion to intervene or protest with the Federal Energy Regulatory Commission, 825 North Capitol-Street, N.E.,
Washington, D.
C.
- 20426, in accordance with Rules 211 and 214' of the Commission's Rules of Practice.and Procedure'(18 C.F.R.
SS 385.211,
-385.214).
All such motions or protests should be filed 1
on or before Protests l
will be considered by the Commission in determining the appropriate action to be taken, but will not ' serve to make. protestants parties to the proceeding._
Any person wishing to become a party must file a motion j
to intervene.
Copies of this filing are on file with i
the Commission and_are available for public inspection.
Lois D. Cashell Acting Secretary J
j i
m.
m
__...__1_r..i._
_____._m___._1._,_
_..______.________.__________.______.____n
. - - - - - - - - - - ~
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MICOLE - BOUTH UTILITIES. INC/ECX 81005/'N EW OR LEANS. LA 70181/:504) 529 -525E
.aCm L. meme u s=.o= v.c a==eseese t
- s,
,e-c.ceu r.
.e.e.e...
July 6, 1988
-Tederal Energy Regulatory Commission
-825 North Capitol Street, N.E.
Washington,'D.C. 20426 3
Attenticn:
Ms. Lois D. Cashell, Acting Secretary, '
Centlemen:
3.
Pursuar.t to Part 35 of the. Comitission's Rules and Regulations, MSU System Services, Inc.
(SSI).- as. agent for Arkansas Power & Light Company-( AP&L).,
Louisiana Power & Light company (LP&L), Mississippi Power & Light Compa.y (MP&L). and'.New Orleans Public Service Inc. (NOPSI), hereby encloses for f211ng the following:
1.
Six (0) copies of a Contract for Purchases of Economic Energy by Oglethorpe. Power Corporation (Oglethorpe) from AP&L, LP&L, MP&L, NOPSI and $51, dated June 1,1988 (Contract).
2.
Six (6) copies of - a letter agreement for a short cern reserve capacity ar.d energy sale by AP&L, LP&L, MP&L and NOPSI to -
Oglethorpe, dated June 3.1988 (Letter Agreement).
3.
Six (6) copies of a Notice to be published in the Federal Register.
I..
.A check in the amount of $5,780.00, payable to the Treasurer of the-United States, to cover the requisite filing fee in accordance with Section 381.502 of the Commission's regulations.
5.
A sums,ary of an evaluation providing justification for a component of the proposed pricing in the Contract.
6.
A Schedule of Projected Revenues for the Letter Agreement.
s.
7.
The original and five (5) copies of this letter of transmittal.
8.
A self-addressed, stamped envelope and extra copy of this letter of c:ansmittal for time-stamping and return to SSI.
Contract for Purchases of Economic Enerrv i
l The Contract provides a framework for energy sales by the Middle South l-System Companies to Oglethorpe for terms ranging up to one year.
Transmission service from the Tennessee Valley Author 2.ty is expected to be available to permit transactions under the Contract to take place.
The Contrace is vizcually identical to a contract between the Middle Souen System l
~
Lk h
Tederal C.tergy Regulatory Commission July 6, 1988 Page Two Companies and Florida Power & Light Company, which was approved in FERC Docket No.
ER87-229 000.
The pricing is anticipated incremental production cost plus i
a variable adder not to exceed 5 mills /kVh.
The adder will inc~1ude; for energy purchased for resale, the estimated cost of transmission losses.
'*e believe this pricing to be j us t and reasonable, and within the bounds of p
traditional regulatory practice, for the following reasons:
1 1.
The proposed rate ~is identical to rates previously accepted by the Commission for the Florida Power & Light Company contract referred to above (AP&L Race Schedule FERC No. 113, LP&L Race Schedule FERC No.
79, MP&L Rate Schedule FERC No. 271, and NOPSI Race Schedule FERC No.
10).
The rate has also been accepted by the Commission in' Mississippi Power G
Light Company Replacement Energy se rvice schedules (Supplement No. 3 and Supplement No. L to Supplement No. 3 to MP&L Race Schedule FERC No.
266 Docket No.
ER85 560-000:
Supplement No.
19 and Supplement No. I to Supplement No. 19 to MP&L Rate Schedule FERC No.
257., Docket No. ER86-36-000; and Supplement No.
10 to MP&L Race Schedule P'ERC No. 268 Docket No. E186 679-000).
While a fixed 5 mills /kWh adder has been accepted previously by the FE*C in a
filing involving AP&L and Union ' Electric Company (Supplement No.
I to Supplement No. A to AP&L Rate Schedule FERC No.
92:
Docket No.
ER84 578 000), use of a variable adder with a 5 mills /kWh cap, that can be set to reflect the circumstances of a specific transaction, is judged by the parties to provide a greater degree of flexibility for their mutual benefit.
2.- A five mill /kWh maximum adder recovers a portion of the fixed costs of the generating capacity and transmission facilities used to serve off-system sales.
This statement is supported by 1) an evaluation of the fixed costs (in $/MWh) of the generating units used to serve i
off-systra sales from January throu5h December,1987, and 2) by an evaluatien, performed on a consis tent basis, of the transmission facilities costs for each of the Middle South System Companies. The methodologies used for the generating capacity evaluation are-as follows:
4 a.
The 1987 fixed cost /kW-Month for each unit used to supply energy for off system sales was determined using the Rese rve Equalization methodology prescribed in Service Schedule MSS-1 of the Agreement Among Arkansas Power & Light Company, Louisians Power & Light Company, Mississippi Power & Light Company, New Orleana Public Se rvice Inc.,
and Middle South Services. Inc.
(System Agreement),
to obtain the fixed cost ($/kW-month) for each such unit (AP&L Rate Schedule FERC No.
94, LP&L Rate l
Schedule FERC No. 69, MP&L Rate Schedule FERC No. 262, and NOPSI Rate Schedule FERC No.
8).
The fixed cost /MVh was then de te rmined using actual equivalent availability factors for 1987.
Reserve equalization data for 1987 was used. A we1 hted 6
average fixed cost /MWh for energy generated for off system sales was then determined using each unit's proportion of energy generated for such sales, b.
Same as "a"
- above, but usin5 1988 res e rve equalization projections.
k i
Tcderal Energy Regulatory Commission July 6. 1988
'Page Three 1
c.
Sama as "a"
above, but usin5 a 1988 cost of service study which r: identifies fixed costs on a station basis rather than individual generating unit basis.
All three methods demonstrate a generation fixed cost exceeding tvancy mills /kWh.
j An analysis of the current fixed costs of each Middle South System Company's transmission facilities was performed using AP&L's trans-mission service formula rate (AP&I. Kate Schedule FERC No. 95) and j
1987 FERC rorm 1 data. Use of a filed, approved race formula has the advantage of calculating each Company's transmission costs on a consistent basis, and avoids the use of filed rates based on poten.
cially obsolete data.
The transmission costs were converted from
$/kU oonth to $/MWh using a 1004 load factor. Use of a 1004 load factor, which we understand represents traditional Commission prac.
j
- tica, overstates transmission system usage. A Middle South Systes 1
load factor of sixty percent' (604) would, in our view, be more realistic.
The evaluation using a 1004 load factor results in a transmission cost of approximately 1.6 to 2.3 mills /kWh, depending on the :tiddle South System company being considered.
The sua of generation and transmission fixed costs greatly exceeds the cap proposed in the Contract. A summary of the above-described evaluations is enclosed.
- 3. -The pricing provides, within the framework of traditional regulatory.
- practice, flexibility to allow'the Middle South System Companies to compete for the business of Oglethorpe. Oglethorpe, in turn, will have an additional source of energy available to it that it did nor i
have previously.
To sue:essfully compete for a sale to oglethorps, it is expected that the not delivered price of energy supplied by the Middle South System Companies will be below the net delivered costs from other sellers, including The Southern Companies.
e Sales unde r the Contract are expected to be for the joint account of all the Middle South System operating companies, in accordance with the provisions of-Service Schsdule MSS-5 of the System Agreement. The net revenues received from oglethorpe which exceed the actual cost of the energy sold will be distributed among the Middle South System Companies in proportion to the Responsibility Ratio of each, in accordance with MSS-5 of the System Agreement.
The actual cost of the energy sold will include, if transmission service is purchased by the Middle South System Companies, the cost of such transmission service.
This cost will be deducted from the revenues received, to arrive at a net balance, in accordance with Sections 50.01. 50.02 and 5.06 (1) of the System Agreement.
The proposed effective date of the Contract for Purchases of Economic Energy is June 1,
- 1988, in order to allow sales to Oglethorpe to be made during oglethorpe's summer peak period.
Due to the time required to negotiate l
and execute the
- Contract, it was not poss~ ble to file the Contract with the i
Commission sixty (60) days prior to the proposed effective date.
SSI.
therefort, respectfully requests that ene Contract be allowed to become effective June 1.
- 1988, and that the Commission's nottee requirements uncer Secticn 35.11 of the Commtssion's regulations be waived.
Tederal Energy Regulatory Ccamission July 6, 1988 Page Four s
No schedula. of estimated sales to Oglethorpe or projections of expected revenues for the initial twelve months are attached because sales to Ogle tho rpe under the C5ntract cannot be projected with any delree of accuracy.
No sales have yet been negotiated or initiated.
3 Letter t rreement for Sale of R eerve Cspacity The Letter Agreement providcs for the sale of Reserve Capacity and Energy to Oglethorpe from a day to be decernined during the month of June,1988 through August 31, 1988, or later if mutually agreed.
SSI is advised that the capacity and energy will be rescid to Seminole Electric Cooperative, which t
suffered a fire at its Seminole 1 coal unit (Electric Utility Week, May 23. -
1988).
The capacity charge is $1.50 per kW. month, pro. rated for June dependent upon the date the transaction first occurs, which is well below full of service as demonstrated by the analysis enclosed to support the 5 mill cost for the energy adder in the Contract for Purchases of Economic Energy.
cap The energy charge is 22 mills /kVh, which includes the cost of transatssion service provided by the Tennessee Valley Authority (TVA).
Transaiasion service costs will be deducted from the revenues received to arrive at a net
. balance for the Middle South System Companies, as described above for the contract.
The cost of the transmission service is 3.4 mills /kWh plus 3t input for losses (rounded up to the nearest megawatt), subject to a $1,698 minimum monthly bill. Because the energy is expected to be taken only during on. peak hours, the energy charge not of transmission service costs is expected to closely approximate the incremental energy cost incurred to serve the sale.
Both the energy and capacity charges were negotiated at aras' length in a very competitive bul:c power market in the southeastern U.S.
The proposed effective date of the Letter Agreement is June 14, 1988, to allow Oglethorpe to provide this capacity to Seminole Electric Cooperative, which suffered ~ a fire at its Seminole 1 coal unit and needs capacity to serve its customers.
The transaction started on June 14 Due to the time required to negotiate and execute the Letter Agreement, and for Oglethorpe to seke corresponding arrangements for sale and delivery to Seminole Electric Cooperative, it was not possible to file the Letter Agreement with the Commission sixty (60) days prior to the proposed effective date.
- SSI, therefore, respectfully requests that the Letter Agreement be allowed to become effective June 14, 1988, and that the Commission's notice requirements under Section 35.11 of the Commission's regulations be waived.
A schedule of ' projected revenues for the term of the Letter Agreement is enclosed.
Information Aeolicable to the Centract and Letter Arreement No facilities have been installad or modified in connection with the transactions contemplated by the Contract or the Letter Agreement.
A copy of this filing is being mailed concurrently to Oglethorpe, AP&L.
&L.
MP&L and NCPSI. for the parties and for transmittal to theim regulatory encrities in acecreance with Section 25.2 of the Commission's Regulations.
L
Tederal Energy Regulatory Commission July 6, 1988 i
Page Five i.
If further. information is required, please atJvise Mr. Max A. Sherman.
Power Transactions Administrator, or our attorney, Mr. Christopher T. Screen at MSU System Services. Inc.
Vould you please acknowledge receipt of this filing by time stamping the enclosed extre copy of this letter and returning it in the enclosed self-addressed, stamped envelope.
Very truly yours.
MSU SYSTEM SERVICES.
INC..
ACENT TOR ARKANSAS POWER & LICHT COMPANY.
LOUISIANA POWER & LIGHT COMPANY.
MISSISSIPPI **" & LICHT COMPANY AN NEW O d PUBLIC
(
ERVIC, /
NC.
~~
V
'J. L. Kin y Senior Vice Pre $.J' f
Enclosures 9
_.m.
i T; der:1' Energy Reguistory Comunission.
July 6. 198g Page Six bec: MSU Operatirs Committee Mr; D.'T. Mainers
..r. D. Calverr (Oglethorpe)&
Ms. P. Alexander (TERC)
Mr. J. J Saacks Mr. J. F. Tsger Mr. R.'G. Tramps Mr. J. E. Braba ton, Jr.
Mr. V..D.
Phillips Mr. P. A. Coff.
Mr. J. V. Schimpf Mr. R. M. Hawkins Mr. W. J. Lannes Mr. W. H. Stewart Mr. R. L. Bea.i Mr. F. J. Poche Ms. M. S. Marmillion Mr. R. H. Teod Mr. M. A. Sherman
-Mr. C. T. Screen Ms. L. 8. Hirsch S
1 l
$lOOLE SOUTH UTILITIES, INC/ECX b.305/N EW ORLEANS. LA 70181/( 504) 529-52B2 1
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.o. v.cc..e ioen, everem caecureve..e=Arien.
June 3, 1986 F
Mr. T. Kilgore, Senior Vice President i
Power Supply Oglethorpe Power Corporation 2100 East Exchange Place P. O. Box 1349 p
Tucker, Georgia 30085
SUBJECT:
OFFER TO SELL RESERVE CAPACITY AND ENERGY
Dear Mr. Kilgore:
MSU System Services.
Inc.
(SSI), as agent for Arkansas Power & Light l
Company, Louisiana Power & Light company, Mississippi Power & Light Company and New Orleans Public Service Inc.
(collectively, the Middle Scuch Companies), hereby offers to sell to Oglethorpe Power Corporation (Oglethorpe Power) up to 150 megawatts (Nii) of reserve capacity and energy, from the Middle South Companies' reserves, beginning in the month of June,1988 and continuing throu5h August 31, 1988. The term of this transaction may be extended by mutual agreement.
The capacity charge per kilowatt (kW) per month is
/kW month. The initial capacity will be 50 MW and the espaciti charge for the month of June will be prorated dependent upon the dste the first transaction occurs. The capacity provided shall be increased upon written notice from Oglethorpe Power.
The energy charge per megawatt-hour (lWh) of energy scheduled by Oglethorpe Power and delivered by the Middle South Companies is mills /kWh.
Oglethorpe Power's minimum energy commitment shall be based on a 47% monthly load factor for the term of this transaction.
Delivery of power and energy will be at the Tennessee Valley Authority (TVA) intercoanoccions with Oslothorpe Power or Georgia Power Company, or such other interconnections as may be mutually agreed. All power and energy must be scheduled at least sixteen (16) hours in advance of delivery, or at such lesser time as may be agreed to by the SSI and Oglethorpe Power dispatchers (or Oglethorpe Power's designated agent, who shall be identified is writing to SSI).
SSI shall be solely responsible for scheduling and paying for transmis-sion services provided by TVA or other third party in accordance with separate agreements between SSI and TVA or othe'r third party. The cost of such transmission services is included in the energy price to Oglethorpe Power.
This offer shall be contingent on SSI obtaining transmission service from j
~VA or other third party thich is acceptable to Oglethorpe. Power. Oglethorpe j
Power shall indicate its acceptance of said arrangements, between SSI and TVA or other third party, in writing to SSI.
b Mr. T. Kilgore J*sie 3, 1988 Page Two 3
Should $$I or TVA curtail this transaction, as provided in this Agreement
.or applicable written transmission service agreement, for more than four (4) i hours on any day, the monthly capacity charge during the month in which the j
curtailment occurs shall be reduced by for each kW se curtailed for
)
sach day of such curtailment.
In no event shall the capacity charge be less then zero for any month during the ters of this Agreement.
I It is understood that Oglethorpe Power is purchasing this capacity and energy for. resals to Seminole Electric Cooperative (Seminole). If transmis-sion limitations occur _which prevent the delivery of especity and energy to
)
Seminole during any on-peak hour for three non-consecutive days, in any seven
' day period,. Seminole may cancel or suspend any further delivery of capacity i
and energy by providing one week's written notice to Ogler.horpe Power. In the event of such cancellation or suspension Seminole shall not be obligated i
to pay any capacity and/or e.nargy charget beyond the effective date stated in l
the written notification and consequently oglethorpe Power Corporation will be relieved from capacity and energy charges by SSI in a similar manner.
l Invoices for any month will be rendered on or before the teach (10th) day l
of the following month, and will be payable by Oglethorpe Power before the
.first (1st) day of the next month or twenty (20) days after the receipt of the invoice, whichever is later, c/o SSI Treasurer, F. O. Box 61000, New I
- orleans, Louisiana 70161.
All remittances for payment shall be made by immediately available funds, unless otherwise agreed.
~
I Neither SSI nor any,of the Middle South Compartes nor 05 echorpe Power 1
shall be in default of any of its obligations under this Agreement because of l
events or omissions beyond the reasonable control of the party se con-strained.
Such reasons shall include but are not limited to wars, acts of l
Cod, natural disasters, and labor disruptions (provided that no person shall have an obligation to sectie labor disputes as a result of this Agreement).
SSI shall further have the 'right to curtail delivery hereunder if 1
transmission limitations on the Middle South Companies' transmission systems are. Judged, in the sole discretion of SSI, to prevent or curtail delivery of l
the energy to Oglethorpe Power as nrovided herein.
]
l In the case of lose, damage or injury (including death) of any person (s) or property, occurring on a party's own system, that party shall indemnify,
)
save harmless and defend the other party hereto (including the other party's l
- parent, subsidiaries, affiliates and their respective officers, directors, agents and employees) against claims, demands, costs or expenses in any manner riirectly or indirectly connected or growing out of the generation, transmission or use of electric capacity and energy or performance under this Agreement, whether or not due to or caused by negligence of the other party.
Each party further agrees to waive all rights against and to release the other party for any liability which it may incur for payment, if any, of benefits to its own employeen under any statutory obligacion.
Neither party may assign this Agreement or the rights or obligations thereunder without written c;nsent of the other party.
Mr. T. Kilgore June 3, 1988 Page Three
":" :I
~
Vaivers of the provisions of this Agreement or excuses of violations of this Agreement shall be valid only if in writing and signed by an authorized officer of the party issuing the waiver or excuse. A waiver or excuse issued under one set of circumstances shall not extend to other occurrences under similar circumstances.
This constitutes the entire Agreement between the parties, and supercedes any prior agreements or representations as to the subject matter hereof, whether written or oral.
This Agreement may be amended only in writing signed by bar:5 parties.
This Agreement shall be governsd by appropriate federal law and, where state law is applicable, by Mississippi law.
This oft'ar and acceptance thereof by oglethorpe Power shall be subject to approval of all regulatery bodies having jurisdiction.
This offer supersedes our letter offer es yws dated May 26, 1988. Unless accepted on or prior to June 17,
- 1988, this r2 feet shall expire on June 17, 1988 unless otherwise extended.
If this offer is acreptable to Oglethorpe Power Corporation, would you pisase so indicate by signing two enclosed copies of this letter and returning them to the undersigned no later than June 17, 1988.
Yours very truly, MSU SYSTEM SERVICES.
INC., AGENT FOR ARKANSAS POWER & LIGHT COMPANY, LOUISIANA POWER & LIGHT COMPANY, MISSISSIPPI POWER & LICHT COMPANY, NEW 0 BLI SERV INC.
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J. L. Kl g /
Senior Vic nt ACCEPTED by OC ORPE POWER CORPORATION
- -Sy:
?Y s'
Preside'n CEO Date:
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- dc TENNESSEE VALLEY AUTHORITY D CHATTANOOGA TENNESSEE 37401 23 12SE Lookout Place 744 JUN 10 G88 gi a,~l,)-
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Mr. Bob U Southe.cn Company Services l '-
P.O. Box 2625 Birmingham, Alabama 35202
Dear Bob:
As you requested,.I an enclosing a copy'of the transmission service agreement between TVA and Mississippi Power and Light Company. We can start the transfer as soon as the company is ready on or after June.13.
By copy of this I am also sending a copy to George Marks as he requested.
Very truly yours, TENN4SSEE VALLEY AUTHORITY
/
Ralph E. Ferguson Manager of Power System Operations Enclosure ec:
Mr. George Marks Florida Power Company EC-37 P.O. Box 14042 St. Petersburg, Flcrida 33733 Me, James E. Brabston, Jr.
Mid-South Services P.O. Box 61005 New Orleans, LA 70161 An Ecual Opportunity Empiover
p,.
g TENNESS3E VALLEY AuTwon:Ty xwoxvia uf. TENNESeEE 37 eon 400 West Summit Hill Drive June 13, 1988 Mr. Donald C. Lutken, Chairman Mississippi Power & Light Company P.O. Box 1640 Jackson, Mississippi 39215-1640
Dear Mr. Luckan:
.W This will confirm the arrangements agreed upon between representatives of Mississippi Power & Light Company (hereinafter called " Company") and the Tennessee Valley Authority (hereinafter called "TYA") for ITA to accept, transmit through its transmission system, and deliver nonfirm power and energy (hereinafter sometimes called "Interruptible Energy") being transmitted from the system of Company to the system of Georgia Power Campany and.to such other systems as may be mutually agreed upon (hereinafter individually and collectively. called " Receiving System").
Such acceptance, transmission, and delivery of Interruptible Energy by TVA is hereinafter called " Transmission Service."
In consideration of the mutual agreements set forth herein and subject to the provisions of the Tennessee Valley Authority Act of 1933, as amended, it is understood and agreed that:
1.
Transmission Service. For the toes of this agreement, TYA will
-provide Transmission Service hereunder from time to time as, if, and
'when in TYA's judgment adequate transmission capacity is available o'n TVA's system, after allowances for all other demands on TVA's system, including without limitation other, more firm transmission service transactions, to accommodate Company's schedule furnished in accordance with section 3 hereof.
The points of acceptance sad delivery by TVA for transactions hereunder shall be at the points of interconnection between the systems of TVA and Company and of TVA and Receiving System, respectively..TVA shall not be responsible.in any way for the acceptance by, or transmission or delivery of Interruptible Energy through, Receiving System's system or other systems. Company shall be solely responsible for the transmission of Company's power and energy, including any costs associated therewith, through any electric system through which such power and energy flows in
)
reaching the ultimate recipient of such power and energy.
Except for the discontinuance of the delivery of power and energy accepted by TVA as provided in section 4 below or the interruption or curtailment of Transmission Service as provided for in section 6 below and subject to the availability of transmission capacity as provided in this section 1 TVA shall transmit through its j
transmission systcm and deliver such transmitted power and energy on a simultaneous basis with, and only in such amounts as. the power R110987 4
4
letb g
L..
D.
Mr. Donald C. Lucken June 13,'1988 b
an[energyacceptedbyTVAfor.such.transmissionanddelivery;
~
provided, however, that the amounts of power and energy delivered shall_be reduced in accordance with the provisions of section 2 below.- Company shall notify TTA or cause TTA to be-notified promptly of any interruption or curtailment-in the availability of 5
power and energy for acceptance by TTA hereunder. TTA shall not be obligated to supply power and energy from its own sources'or from its purchases from other neighboring systems during interruptions or curtailments in the delivery to TTA of= power'and energy _ foe i
Transs Wsion Service' hereunder, and nothing in this agreement or in L
Company's agreements with others shall have the effect of making _
)
noe shall anything in this agreement or said_ agreements with others l
be construed to require TTA to take any action which would make TVA, directly or indirectly, a source of power supply to Company, to any-l Receiving System, or to any ultimate recipient.
2.
Transmission Losses. The amounts of power and energy delivered from i
l TyA's transmission system hereunder shall be the amounts accepted by TTA for transmission, less 3 percent thereof rounded to the next higher W for any fractional part of a full W as an allowance for
-1 transmission losses. Said 3 percent reflects IVA's best l
determination of average losses associated with Transmission Service hereunder. In the event TTA determines at any time that actual average system losses have increased by more than a full percentage point. TVA shall have the right upon 30 days notice to Company to adjust the percentage allowance for losses hereunder to reflect Ictual average system losses.
'Schedulina. Schedules for Transmission Service for Interruptible Energy any hour during any calendar week following the effective date of this letter agreement shall be furnished by 12 noon CDT or CST, whichever is currently effective, on Thursday of the preceding week.
Company may revise such weekly schedules by giving notice to T7A by 12 noon CDT or CST, whichever is currently effective, on the day preceding that on which the revision becomes effective; provided, however, Company will make every reasonable effort to minimize revisions to its weekly schedule. In the event of loss of generation supplying the Interruptible Energy being wheeled hereunder, Company I
shall so notify TTA and Company shall supply Interruptible Energy from an alternative source until system time is on the hour or an integer of guarter hours past the hour at which time the schedule for the remainder of the day will be reduced to zero, and Company will revise its schedule as necessary for the remainder of the I
week. Schedules furnished for any calendar week shall not be otherwise changed unless TVA discontinues, curtails, or interrupts Transmission Service pursuant to sections 4 or 6 below. or other unforeseen circumstances arise for which the operating representatives of Company and TVA agree to change the schedules.
Company shall furnish, or cause to be furnished, similar schedules simultaneously to Receiving System or to its designated operating R110587
r.
f*-
3-Mr. Donald C. I.athen -
June 13, 1988 i
representative. Schedules for Transmission Service to be performed by TTA shall specify the hourly amounts to be accepted by TTA and the amounts, after deducting the allowance for losses, to be delivered through TTA's transmission system.
y a.
Power and Energy Purchased by TVA.' TVA may discontinue the transmission and delivery of Interruptible Energy hereunder as, it,.
and when conditions on TTA's system are such that TTA's generating sources and other sources reasonably available to TVA, are inadequate to suppry the firm power requirements of T7A's system, and ITA may use the Interruptible Energy scheduled for acceptance by TTA 1
i hereunder to assist TTA in alleviating such conditions. TVA shall
]
' notify Company promptly of all such discontinuances of the transmission,and delivery of Interruptible Energy for such use by
]
TTA.
j As consideration for the Interruptible Energy used by TVA. if any, under this section a.. ITA shall pay Company each month for each kilowatthour used by T7A pursuant to this section during such month. The price per kilowatthour shall be Company's out-of-pocket
)
incremental energy cost plus 10 percent.
5.
Facilities. Unless otherwise agreed, T7A will provide Transmission
~
Service only through existing or future transmission facilities.
(including telemetering, load control, and conusunication facilities) utilized in supplying ITA's customers' power requirements. The existing metering facilities for the points of interconnection between the TTA system and the systems of Company and Receiving S'ystem shall be used to measure the power and energy associated with Transmission Service hereunder.
6.
Interference with Availability of Transmission Service. T7A may curtail or interrupt Transmission Service hereunder as, if, and when, in TVA's judgment, continuation of such Transmission Service could (1) jeopardize service to TVA's customers, (2) interfere with transactions scheduled or to be scheduled under any of TTA's existing or future contractual arrangements with systems othei than Company, including without limitation other, more firm transmission service transactions and other transactions commonly referred to as
" economy interchange," or (3) reduce the reliability of T7A's system, either with respect to T7A's customers or with respect to T7A's interconnections with neighboring systems. TVA shall not be considered to be in default with respect to any obligation hereunder in the event of any such curtailment or interruption of Transmission Service or if TVA is prevented from fulfilling such obligation because of force majeure or otherwise. The term " force majenre" shall be deemed. for the purposes of this agreement, to be a cause reasonably beyond the control of the party affected, such as, but without limitation to, injunction, strike of the party's employees, war, invasion, fire, accident, floods, backwater caused by floods, acts of God, or inability to obtain or ship essential services.
materials or equipment because of the effect of similar causes on r.he party's suppliers or carriers.
R110987
-r, e..
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g 4
Nr.' Donald C. Lutken 1
June 13. 1988 TTA shall notify Company promptly of all such curtailments or interrup'tions.of Transmission Service under this section 6.
7.
Reactive Pouer.s Company will supply reactive power to the extent necessary in TVA's jud; ment to effect the transfer of the amount of t
3 power scheduled through the TVA system to Receiving Systes under-this agreement.
8.
Transmission Service Charas. The transmission service charge per month TEall be the higher of (1) 31.698 or (2) 3.4 mills per.
kilowatthoue applied to the Interruptible Energy scheduled for g
-acceptance by TTA in accordance with section 3 hereof, as;said scheduled amounts are adjusted by schedule revisions as provided in said section.3.
The above charges.are based on T7A's estimated _transalssion system costs for the fiscal year'which ends'Septembee 30, 1988.. TVA may i
adjust _or modify said charges effective October 1, 1988, and October 1 of each successive year through~the end of the term of this agreement to reflect changes in its transmission system costs projected for the ensuing' fiscal year.
The methodology being used at that time by TVA in cost of service studies for its system shall be used by TVA in calculating any such annual projected transmission system costs.
9.
Records.
Each party shall heep such records as wi11' provide a clear
-history of the transactions hereunder.
Upon request, copies of any or all pertinent records shall be delivered promptly to the other party.
10.
Statements._ As'promptly as practicable after the first day of each calendar month, the parties shall cause to be prepared a-statement setting forth the transactions hereunder during the preceding month in such detail and with such segregation as may be needed for operating reeceds or for settlements under the provisions of this agreement. Any such statement prepared by one party shall be made available to the other party.
11.
Billinas and Perments. Monthly bills foe amounts owed by Company to TVA shall be rendered by TVA. and such bills shall be due and payable within 20 days after the date of the bill. To any amount due and unpaid after the due date, there shall be added's charge of 1.5 percent of the unpaid amount. and an additional 1.5 percent of the then unpaid amount shall be added for each succeeding 30-day period until the amount is paid in full.
12.
Restriction of Benefits. No member of or delegate to Congress or Resident Commissioner, or any officer, employee, special Government employee, or agent of TVA shall be admitted to any share or part of this agreement or to any benefit that may arise therefrom unless tne agreement be made with a corporation for its teneral benefit, nor R110587
_-m2._
_u._________
_.___--_________._a.[.'________
. L Br. Donald C. Lutken June 13,1988 -
shall' Company offer or give, directly or indirectly, to any officer, employee, special covernment ' employee, or agent of TVA any gif t, i
gratuity, favor, entertainment, loan, or any other thing of monetary value, except as provided in 18 C.F.R. 5 1300.735-12 or -34.
Breach of this provision shall constitute a material breach of this agre y
{
13.
Regulatory Approval. This agreement is made subject to receipt by company of any requisite governmental and regulatory approvals.
14.
Tenn. This agreement shall become effective as of the date first above written and shall continue in effect for an initial term of one year from said date and from year to year thereaftee unless terminated by either party at the end of said initial term or of any yearly extension thereof upon at least ninety (90) days' prior written notice to the other.
If the arrangements set forth above are satisfactory to company, please execute and return four copies of this letter agreement to me.
Upon completion by TVA, two fully executed copies will be returned to you.
Very truly yours, TElnfESSEE VALLEY AUTHORITY
~
~
W. F. Willis General Manager OGC Accepted and agreed to as of the date first above written.
MSU System Services Inc., Agent for MISSISSIPPI POWER & LIGHT COMPANY By
Title:
A R110587
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14c' f
rg-CONTRACT FOR PURCHASES 2
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OF ECONOMIC ENERGY e d [-. '
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OGLETHORPE POWER CORPORATION
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'FRON i
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AREANSAS' POWER & LIGHT COW ANY,
/ d4./4Whdfd=4ur LOUISIANA POWER & LIGHT COWANY, MISSISSIPPI POWER & LIGHT COW ANY,
@/
NEW ORLEANS PUBLIC SERVICE INC.,
p and MSU SYSTEM SERVICES, INC.
pm, l, Section 0.1:
THIS CONTRACT is made and entered into this 1st day of June, 1988 by and among oglethorpe Power Corporation, a corporation organized and existing under the laws nf the State of Georgia, herein referred to as "OGLETHORPE," and.MSU System Services, Inc. (SSI), a Delaware corporation, as agent for Arkansas Power & Light Company, an Arkansas corporation, Louisiana
~
Power & Light Company, a Louisiana corporation, Mississippi Power & Light -
- Company, a Mississippi corporation, New Orleans Public Service-Inc.,
a Louisiana corporation, 'all five companies collectively referenced herein as the " MIDDLE' SOUTH SYSTEM COMPANIES".
ARTICLE I RECITALS Section I.1:
OGLETHORPE and MIDDLE SOUTH SYSTEM COMPANIES (each individually identified herein as a " Party" and both collectively called herein the-
" Parties") own or operate electric generating and transmission systems which are indirectly interconnected through the electric transmission systems of s
- others, j
1 Section 1.L MIDDLE SOUTH SYSTEM COMPANIES desire, from time to time, to sell j
power and energy to OGLETHORPE as set forth herein.
~ _ _.
Section 1.3:
OGLETHORPE desires, from time to time, to purchase such Economic from M100LE SOUTH SYSTEM COMPANIES.
4
Section 1.4:
. Each Party desires to establish the terms, conditions, rights, and obligations with respect to the purchases by OGLETHORPE and sale by MIDDLE SOUTH SYSTEM COMPANIES of such Economic Energy.
NOW, THEREFORE, in consideration of the foregoing prettises and of the mutual benefits to be obtained from the covenants herein, the Parties do S
hereby agree as follows:
ARTICLE !!
p.
DEFINITIONS For all purposes of this CONTRACT, the terms defined in this Article !!
shall have the following meanings.
Except where the context otherwise requires, definitions and other terms expressed in the singular number shall include the plural number and vice versa, and definitions and other terms
- i. den t i fying persons shall include firms, associations, corporations, districts, agencies and bodies.
Section 221 - Capacity Resources:
" Capacity Resources" shall mean any electric generating capacity available to a Party and may include capacity purchased from another utility if necessary transmission arrangements have been made and if such capacity is available to that Party on a basis and priority at least equivalent to the situation that would exist if the Party owned an equivalent amount of generating capacity.
Section 2.2 - Delivery Points:
" Delivery Points" shall mean those point (s) of delivery for transactions hereunder as agreed at the initiation of each transaction.
Section 2.3 - Delivery Service:
" Delivery Service
- shall mean the eneroy transfer service provided by Delivery Service Utility hen it utilizes its system and control area to schedule contemporaneous receipts and deliveries of 2
.T..
power and energy between two utility systems with which the Delivery Service Utility is interconnected.
u I
Tect'iim 2.4 - DeNvery Service Utility:
" Delivery Service Utility" shall mean TWT,Fe7v'ening third party utility system (s) which provides for the contemporaneous receipt and delivery of power and energy pursuant to purchases
?
by OGLETHORPE~under this CONTRACT from MIDDLE SOUTH SYSTEM COMPANIES.
Section 2.5 - Federal Power Act: " Federal Power Act" shall mean the Federal L
i Power Act, 16 U.S.C.S. 792, et sea. as it is now or shall be amended in the future, or any successor thereto.
Section 2.6 - FERC: "FERC" shall mean the Federal Energy Regulatory Commission i
or any successor having comparable responsibilities.
+
Section 2.7 - Force Majeure:
" Force Majeure" shall be defined in Section 8.1 of this CONTRACT.
Section 2.8 - Good Utility Practice:
" Good Utility Practice" shell mean any of the practices, methods and acts engaged in or approved by a significant I
portion of the electric utility industry during the relevant time period, or any - of the' practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost cons i st er.f. with reliability, safety and expedition.
Good Utility Practice is j
not intended to be limited to the optimum practice.
L Section 2.9 - Operatino Comittee:
" Operating Comi ttee" shall mean the 2
committee established by OGLETHORPE and MIDDLE SOUTH SYSTEM COMPANIES for the purposes delineated in Section 4.1.
Section 2.10 - Operatino Representatives:
" Operating Representatives ** shall mean those representatives appointed by OGLETHORPE and MIDDLE SOUTH SYSTEM COMPANIES in accordance with Section 4.2.
l l
~
t Section 2.11 - Scheduled Deliveries:
" Scheduled Deliveries" sr.411 mean the amount of power and energy scheduled pursuant to a transaction hereunder to be 7
delivered by MID0LE SOUTH SYSTEM COMPANIES to a Delivery Service Utility's system for OGLETHORPE's account.
}
ARTICLE I!I TERM 0F CONTRACT Section 3.1 - Term:
The term of this CONTRACT shall commence on the 1st day
?
of June, 1988, and shall continue in effect until cancelled by either Party upon one year's written notice to the other Party, or as provided in Sections 9.1 and 10.1, or at any time upon mutual written agreement between the Parties; provided, however, that the term of the CONTRACT shall not be for a period less than the term of any commitment for a transaction hereunder, except as provided in Section 9.1 and 10.1.
ARTICLE IV OPERATING CO6NITTEE & REPRESENTATIVES c
Section 4.1 - Operatino Committee:
The MIDDLE SOUTH SYSTEM COMPANIES, collectively, and OGLETHORPE shall each appoint a member and an alternate to I
i an Operating Comittee, and so notify in writing the other Party.
Such l
appointments may be changed at any time by similar otice.
Each member and
\\
alternate shall be a responsible person working with the day-to-day operations j
of each respective electric system.
The Operating Comittee shall represent the Parties in all matters relating to the administration of this CONTRACT The duties of the Operating Comittee shall include the following:
(1)
Establish procedures for implementing transactions urder this
~
CONTRACT, as required.
- i w
4 4-I
(2)
Establish methods and procedures for accounting and billing of transactions hereunder.
?
(3)
Such other related or incidental duties as may be conferred upon it by mutual agreement of the Parties.
Each Party shall cooperate in providing to the Operating Committee all s
information. required in the performance of its duties.
All decisions and i
agreements made by the Operating Committee shall be evidenced in writing.
Section 4.2 - Operatino Representatives:
MIDDLE SOUTH SYSTEM COMPANIES (col-tI lectively) and OGLETHORPE shall each appoint at least one representative to act for it in matters pertaining to the duties of the Operating Representative as required by this CONTRACT, and each Party may appoint, an alternate to act for it in the absence of its representative.
Evidence of such appointments shall be given by written notice to each of the Parties, and such appointments may be changed at any time by similar notice.
I ARTICLE V TRANSMISSION SERVICE AND SCHEDULING ARRANGEMENTS Section 5.1 - Arrangements for Transfer of Power and Energy throuch Other Systems:
Since the electric systems of the Parties are not directly interconnected, any Scheduled Deliveries of power and energy between the Parties will require the scheduling of flows through a Delivery Service Utility.
Section 5.1.1 - Arrangements with the Delivery Service Utility:
When OGLETHORPE desires to purchase power and energy under this CONTRACT, a
commitment to OGLETHORPE from the Delivery Service Utility is a condition precedent to finalizing terms of any transaction hereunder.
OGLETHORPE shall notify MIDDLE SOUTH SYSTEM COMPANIES of the duration of such comitment prior to finalizing terms of any transaction hereunder.
i l
Following agreement on terms of a transaction between the Parties.
0GLETHORPE shall make arrangements with operating representatives of the Delivery Service Utility and with MIDDLE SOUTH SYSTEM COMPANIES' Operating Representative to facilitate scheduling of the power and energy provided hereunder and estabilsh procedures for the timely communication v
of power and energy receipt and delivery schedules.
It shall be~the sole
{
responsibility of OGLETHORPE to make arrangements with the Delivery Service Utility for Delivery Service provided.
MIDDLE SOUTH SYSTEM COMPANIES and OGLETHORPE agree to operate their respective utility systems in accordance with Good Utility Practice and in accordance with their respective interconnection agreements with such Delivery Service Utility.
Each Party hereby agrees to release the other Party from any liability it may incur resulting from an interruption or curtailment of Delivery Service by the Delivery Service Utility with respset to a transaction hereunder.
Section 5.1.2 - Operatino Relationships with Other Third Party System:
0 If a transaction under this CONTRACT unduly burdens a third party system (other than the Delivery Service Utility) and the operating relationships under contracts between a Party and a third party, the af fected Party shall notify the other Party and the transactions shall be interrupted or curtailed unless or until the adverse effect is otherwise relieved or unless the Parties agree to continue the scheduled transfer.
i The Parties shall use their best efforts to operate their respective utility systems in accordance with Good Utility Practice and to maintain good operating relationships with such third party utilities to which the Y _____A_
m n.m.
A.
.J
r I
respective Parties' systems are interconnected, including operating the Parties' respective as not to unduly burden such third party utilities N
and including prov' ding for such third party utilities' system protection i
and consideration for services rendered as provided in related agreements.
D Section 5.1.3 - Interruptions, Curtailments and Resumptions of Transactions:
In the event Scheduled Deliveries ar6erruptehther
(
by the Delivery Service Utility or because of undue burdening of third I#
l party systems, OGLETHORPE shall be obligated only to make payment for the amount of Scheduled Deliveries of power and energy up to the time of such interruption.
OGLETHORPE's payment obligation for Scheduled Deliveries shall only become' effective agair. at a time when the Parties agree to re-schedule such previously interrupted Scheduled Deliveries.
In the event Scheduled Deliveries are curtailed y the Delivery Service Utility or because of undue burdening of51rd party systems, the Parties may agree to continue the transaction and Scheduled Deliveries at the l
curtailed level.
During such period of curtailment, OGLETHORPE shall only be obligated to make payment for the amount of Scheduled Deliveries 1
based on such curtailed level.
l In those instances in which a transaction has been interrupted or i
curtailed for any reason, the Parties may either prior to or after such curtailment or interruption agree to reschedule and resume Scheduled
~
Deliveries as if they had not been interrupted or curtailed or at a
ahatever level and amount of Delivery Service OGLETHORPE is able to secure a commitment from the Delivery Service Utility.
During such 7
._x..__._
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c rescheduled periods, OGLETHORPE's payment obligation shall be based on the agreed level and amount of Scheduled Deliveries, except in the event p
of subsequent curtailment or interruption.
In the event the Parties do not agree to reschedule and resume Scheduled Deliveries relative to a transaction within a reasonable time, or Delivery Service cannot be secured, the transaction shall then terminate.
Section 5.I'- Scheduled Deliveries used in Billino:
It is recognized that both OGLETHORPE and MIDDLE SOUTH SYSTEM COMPANIES maintain multiple interconnections with other utilities.
For this reason the actual flow of power into or out of a system would be the net flow measured at several metering points.
Therefore, due to the difficulty of obtaining these metered values and mak'ng them agree with Scheduled Deliveries, unless otherwise i
agreed upon, all billings shall be in accordance with Scheduled Deliveries at an agreed point or points of interchange rather than actual metered net interchange of power during the period of such Scheduled Deliveries.
For dispatching purposes, all Scheduled Deliveries shall be scheduled on a
~
clock-hour basis and shall be in whole MW and MWtr quantities.
ARTICLE VI ECONOMIC ENERGY SERVICE Section 6.1 - Economic Eneroy Service:
From time to time, there may be Economic Energy available from the Capacity Resources of MIDOLE SOUTH SYSTEM COMPANIES.
When Economic Energy is available, suct, Economic Energy may be of fered to OGLETHORPE to enable OGLETHORFE to reduce output from its Capacity Resources.;
MIDDLE SOUTH SYSTEM COMPANIES shall be the sole judge of its l
?
1 ability t'o supply Economic Energy hereunder and any transaction hereunder
)
l,,
1 1
1 _
shall be entirely voluntary.
The Parties agree that MIDDLE SOUTH SYSTEM COMPANIES may furnish such Economic Energy from any available source it chooses for resale to 0GLETHORPE, including purchase'sfrom a system or systems s
i I
not a party to this CONTRACT.
Section 6.2 - Conditions for the Provision of Economic Eneroy Service:
OGLETHORPE is entitled to purchase Economic Energy only to the extent that OGLETHORPE thas alternate dependable capacity, including purchased
- toacity, available to it that could otherwise be used for the supply of OGLETHORPE's system load if such Economic Energy were not available.
It is further understood and agreed that it shall be the responsibility of.
OGLETHORPE to make arrangements for Delivery Service in accordance with Article V.
Section 6.3 - Eco.wie Eneroy Service Comitment:
To the extent that Economic Energy is requested by OGLETHORPE and is desired to be made available by MIDDLE SOUTH SYSTEM COMPANIES, a comitment shall be made between the Parties hereto for such service, as follows:
Section 6.3.1 - Evidence of Comitment: Each Economic Energy commitment shall be made between Operating Representatives of each respective Party i
and evidenced by letter or logged telephone request and comitment, as appropriate.
All transactions of a duration greater than seven (7) days shall be evidenced by duplicate copies of a signed letter of comitment from OGLETHORPE to MIDDLE SOUTH SYSTEM COMPANIES or vice versa, which document shall provide appropriate space thereon for acceptance by the appropriate Parties.
MIDDLE SOUTH SYSTEM COMPANIES or OGLETHORPE, as i
i
~
applicable, shall sign in duplicate within seven (7) days, or such g
greater period as may be specified as evidence of its acceptance, and one 1
copy thereof shall be returned to the sending Party.
1 1
.g.
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p, Section 6.3.2 - Information in Commitment: Each Economic Energy commitment as described in Section 6.3.1, above, shall document the I
following:=-
(i) the amount of such Economic Energy which OGLETHORPE desires to purchase and which MIDDLE SOUTH SYSTEM COMPANIES has agreed to F
deliver; (ii) the mutually agreed upon basis for' settlement for Economic Energy Service, as established consistent with Section 6.4 hereto; (iii) the starting date and time of. the transaction, number of consecutive days of the transaction, Operating Representative of each party agreeing upon the transaction, the arrangements for an advance daily schedule for Scheduled Deliveries, and the time of agreement; (iv) any necessary notice requirement for interruption, curtailment or discontinuance of a transaction hereunder; and (v) any other pertinent terms and conditions as dictated by the specifics of the contemplated transaction.
Section 6.4 - Price of Service:
The price of service shall be the anticipated incremental cost for all such Economic Energy including the cost of energy purchased from one or more third parties, plus an adder of no greater than 5.0 mills per kWh.
The Parties agree, for energy purchased for resale 'under this Contract, that the adder specified herein shall include the i
incremental transmission losses attributable to the transaction, and that such losses shall not be included in the ant'cipated incremental cost of Economic Energy.
Prior to any transaction involving the delivery and receipt of such Economic Energy, authorized representatives of the Parties shall determine and
L agree upon the compensation applicable to such transaction at the agreed upon Delivery Points.
1 Section 6 5 - Baris for Compensation:
Subject to provisions of Article V, for each transaction hereunder OGLETHORPE shall pay MIDDLE SOUTH SYSTEM COMPANIES Y__
an amount equal to the product of: 1) the price of service (expressed in
. 5/MWh), as described in Section 6.4 and, 2) the amount of Scheduled Deliveries of power and energy (expressed in MWh) purchased under each transaction hereunder.
ARTICLE VII BILLING AND PAYMENT Section 7.1 - Presentation and Payment:
MIDDLE SOUTH SiSTEM COMPANIES shall submit to OGLETHORPE, promptly after the first of each month, a billing statement and invoice for the sales transactions and the respective amounts due under the tems of this CONTRACT for the preceding calendar month except those months in which no amounts are due.
All such invoices shall be due and payable within fifteen (15) days from the date of actual receipt.
Invoices not paid within fifteen (15) days from the date of actual receipt shall bear interest at *he rate provided from time to time for. refunds under the FERC 1
Regulations at 18 CFR Part 35.19(a) or any successor thereto.
All remittances for payment shall be made by imediately available funds, unless otherwise agreed.
Section 7.2 - Disputed Bill: In case any portion of any bill is in bona fide dispute, the undisputed amount shall be payable when due.
OGLETHORPE shall provide with each such partial payment its grounds for disputing a bill.
Upon determination of the correct amount, the remainder, if any, shall become due j
and payable in accordance with Section 7.1, with interest accruing only frem a 1
date fif teen (15) days af ter determination of the correct amount.
i :_=--_____
e ARTICLE VIII FORCE MAJEURE AND INDEMNIFICATION f-Section 8.1 - Force Majeure: In the event that either of the P irties should be delayed in, or prevented from, performing or carrying out any of the agreements, covenants, and obligations made by and imposed upon said Party by this CONTRACT, by reason of or through any cause reasonably beyond its control and not attributable to its neglect including strike, stoppage 3e labor, failure of contractors or suppliers of materials, riot, fire, flood, ice.
invasion, civil war, commotion, insurrection, milita or usurped power, order of any court granted in any bona fide adverse leg.:. proceeding or action, order of. any civil or military authority (either de facto or de jure),
explosion, act of God or the public enemies, failure or malfunction of system facilities, or unscheduled outage of generating units or transmission facilities; then and in such case or cases, both Parties shall be relieved of performance under this CONTRACT and shall not be liable to the other Party for or on account of any loss, damage, injury, or expense (including consequential damages and, cost of replacement power) resulting from or arising out of such delay or prevention from perfoming; provided,
- however, that the Party suffering such delay or p vention shall use due and, in its judgment, practicable diligence to remove the cause or causes thereof; and provided, further, that neither Party shall be required by the foregoing provisions to settle a strike except when, according to its own best judgment, such a settlement seems advisable; and provided further, that nothing in this Section 8.1 shall excuse the payment obligations incurred under Sections 7.1, 7.2, and 10.5 of this CONTRACT.
1 1
Section 8.2 - Responsibility and Indemnifications:
In the case of. loss, damage or injury (including death) of any person (s) or property, occurring on a Party's own system, that Party shall indemnify, save hamless and defend the other Party hereto (including the other Party's parent, subsidiaries, affiliates and their respective officers, directors, agents and employees)
F against claims,
- demands, costs or expenses in any manner directly or indirectly connected with or growing out of the generation, transmission or use of electric capacity and energy or perfomance under this CONTRACT, j
a whether or not due to or caused by negligence of the other Party.
Each Party further agrees to waive all rights against and to release the other Party for
'i any liability which it may incur for payment, if any, of benefits to its own employees under any statutory obligation.
Section 8.3 - Consequential Damaces:
Notwithstanding any other provision of this CONTRACT, neither party shall be liable to the other for consequential damages.
ARTICLE IX 3
CHANGES IN TERMS AND CONDITIONS OF SERVICE Section 9.1 - Unilateral Chances: This CONTRACT, the Economic Energy Service to be rendered and the terms and conditions specified herein, are subject to being superseded, changed or modified, either in whole or in part, from time to time by a legally effective filing of MIDDLE SOUTH SYSTEM COMPANIES with or by order of the FERC.
Notwithstanding the exe ation of this CONTRACT, MIDDLE SOUTH SYSTEM COMPANIES shall have the right at any time to unilaterally make application to FERC for a change in the Economic Energy Service and terms and conditions specified herein, and OGLEiHORPE shall have the right and the
^
option to challenge any such application or to file a complaint under Section W
. 3 L
206 of the Federal Power Act, and/or to tensinate this - CONTRACT either as of
. the proposed or actual s(fective date of the change (s). in the Economic. Energy Service and tetes and conditions as set forth in, MIDDLE -SOUTH SYSTEM COMPANIES' application or thereafter upon sixty (60) days written notice to MIDDLE SOUTH SYSTEM COMPANIES.
s ARTICLE X MISCELLANEOUS Section 10.1 - Reculation:
The provisions of this CONTRACT are subject to the regulatory authority of the FERC and acceptance for filing by the FERC shall be-prerequisite to its validity and to the validity of any amendments hereto.
Contract amendments accepted by the FERC retroactive 'to an earlier date shall be considered valid as of that earlier date.
In the event this CONTRACT is changed or modified by any regulatory agency or authority, either Party, if adversely affected to a material extent, shall have the right to negotiate for the necessary relief to alleviate said adverse effects brought on by either the changes or modifications so imposed.
If'the Parties are unable to obtain the necessary relief after a reasonable period of negotiations, either Party shall have the right to terminate this CONTRACT on six.(6) months written notice to the other Party.
Section 10.2 - Waivers:
Any waiver at any time by any Party of its rights with respect to the other Party or with respect to any matter arising in connection with this CONTRACT shall not be considered a waiver with respect to any other prior or subsequent default or matter.
Section 10.3 - Assionment: This CONTRACT shall inure to the benefit of and be binding upon the Parties and their respective successors and assigns, and, insofar as is permitted by law, on any receiver or trustee in bankruptcy,.
4 reorganization or receivership of either Party.
Nothing in this CONTRACT, express or implied, is intended to confer upon any person.other than t
OGLETHORPE and the MIDDLE SOUTH SYSTEM COMPAh!ES any rights or remedies 1
~
hereunder.
Neither Party may assign its interest in this CONTRACT without the express written consent of the other Party.
4 Section 10.4 Notices: Any notice, demand, or request required or authorized by this CONTRACT: shall be deemed properly given if mailed prepaid to: OGLETHORPE POWER CORPORATION, P.
O.
Box 1349, Tucker, Georgia 30085 1349; Attention:
Manager, Power, in the case of OGLETHORPE; and to: MSU SYSTEM SERVICES, INC.,
P. O. Box 61000, New Orleans, Louisiana 70161, Attention: Power Transactions Administrator in the case of MIDDLE SOUTH SYSTEM COMPANIES or to such other
?
person as may be designated in writing from time to time by OGLETHORPE or by MIDDLE SOUTH SYSTEM COMPANIES.
Section 10.5 - Tax Adjustments: Charges under this CONTRACT are intended to
. include the applicable proportionate part of any taxes and assessments directly applicable to, or a result of, a transaction hereunder (except State or Federal Income Taxes), imposed by any governmental authority in effect as of the date of this CONTRACT.
In the event MIDDLE SOUTH SYSTEM COMPANIES l
becomes subject to a new, increased or decreased tax which is applicable to sales hereunder, M100LE SOUTH SYSTEM COMPANIES shr,Il notify OGLETHORPE of such tax and the effect of such increase or decrease prior to OGLETHORPE's committing to a purchase.
Should any such tax be imposed, increased or l
decreased during the course of a commitment, OGLETHORPE shall have the right l
to either continue the transaction at a price which reflects the tax so imposed,' increased or decreased, or to withdraw f rom the commitment.
In the event the commitment is not withdrawn by OGLETHORPE, notification by MIDDLE
. t 1
=1-___.___
= _. _.
SOUTH SYSTEM COMPANIES shall constitute the basis for payment of such applicable tax by OGLETHORPC, or credit to OGLETHORPE, for the affected k
period.
Section 10.6 - Governino Law: The availability, interpretation and performance of this CONTRACT and each of its provisions shall be governed by the 5
applicable laws of the State of Mississippi and of the United States of America.
Section 10.7 - Interconnection with Other Systems:
Nothing contained in this CONTRACT shall restrict or limit either Party from establishing, altering or terminating interconnection points with any person not a party to this CONTRACT or amending or entering into agreements therefor.
Section 10.8 - Counterparts: This CONTRACT shall be execu'ted in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Section 10.9 - Good Utility Practice: The Parties shall discharge any and all obligations under this CONTRACT in accordance with Good Utility Practice.
Section 10.10 - Headinos Not to Affect ideanino: The descriptive headings of the various Sections and Articles of this CONTRACT' have been inserted for convenience of reference only and shall in no way modify or restrict any of the terms and provisions hereof.
Section 10.11 - Amendments: This CONTRACT may be amended by and only by a written instrument duly executed by SSI and OGLETHORPE.
Section 10.12 - No Consent to Violation of Law: Nothing herein contained shall i
be construed to constitute consent or acquiescence by either Party to any
)
action of the other Party ahich violates the Laws of the United States.
l including the TVA Act of 1933, as amended, as their provisions may be amended.
supplemented or superseded, or which violates any other law nr regulation, or I
____________,_.___.___u____
___ _ J
- any' crder, judgment cr decree cf any court cr gov:rnmental authority of
- competent jurisdiction.
Section 10.13 < Administration for the MIDDLE SOUTH SYSTEM COMPANIES: Unless p
and _ until 06LETH0iPE is otherwise advised in writing signed by all of the MIDDLE SOUTH SYSTEM COMPANIES, administration of this CONTRACT for the MIDDLE L.
SOUTH._ SYSTEM COMPANIES shall be the responsibility of MSU System Services, Inc.
as agent for Arkansas Power & Light Company, Louisiana Power & Light Company, Mississippi Power & Light Company, and New Orleans Public Service Inc.
i.
IN WITNESS WHEREOF, the Parties have caused this CONTRACT to be executed 'by their duly authorized officers, and copies delivered to each party,- effective as of the date and year first above stated.
1 WITNESSETH:
OGLETHORPE POWER CORPORATION l
8Y:
"a BY:
m Date:
~
General Coun'sel V P[esidencand Chief Execucive fficer ATTEST:
MSU SYSTEM SERYlCES, INC. for itself and as agent for ARKANSAS POWER & LIGHT COMPANY, LOUISIANA POWER & LIGHT COMPANY, MISSISSIPPI POWER & LIGHT COMPANY, and NEW ORLEANS PUBLIC SERVICE INC.
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I M BY:
D.
de U
BY:
Oate:
Assistant Secretary Gp6up Vice-President 1
9 W -
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\\_...E__________________.
_.____________.___.___._..._._.___.__.__.____.___.._.____.___._.__.._.m_
______._..m_
W O P c-3 L,.h Draft-
~ July 21, 1988 g
7z/88 V
-POWER SALES AGREEMENT k'
between-kx
~ Georgia Power Company and Oglethorpe Power. Corporation.
(An Electric Membership Generation
& Transmission Corporation)
Dated as of 198 4
1.
l.
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I TABLE OF CONTENTS ARTICLE 'I - DEFINITIONS 1.1 Plant Definitions
(
1.2 Non-Plant Definitions ARTICLE II - TERM OF AGREEMENT 2.1 Term p
2.2 Condition Precedent to Effectiveness 2.3 Right to Terminate 2.4 Date of Expiration or Termination 1'
ARTICLE III - CAPACITY 3.1 Identification of the Units and Certain Definitions 3.2 Determination of Capacity to Be Purchased and Sold 3.3 Entitlement to Capacity ARTICLE IV - ENERGY 4.1 Entitlement to Energy 4.2 Determination of Energy to Be Purchased and Sold 4.3 Determination of Station Service Energy Consumed 4.4 Deemed Receipt and Consumption of Energy by Oglethorpe 4.5 Energy Supply Plan
-i-L_-__'--_-_-
__.x_.~
f-ARTICLE'Vf-DELIVERY POINT AND METERING 5.1 Delivery Point 7
5.2
~ Metering l
ARTICLE VI - DISPATCH AND SCHEDULING W#
6' 1 Dispatch 6.2 Separate Schedul!.ng 5
ARTICLE VII - PROCEDURE FOR CAPACITY AND ENERGY CHARGES 7.1 Periodic Charges Computation Procedure 7.2
-Power Sale Informational Schedule h"
7.3 Changes to the Capacity and Energy Charges ARTICLE VIII - PAYMENTS FOR CAPACITY AND ENERGY B.1 Capacity Payments 8.2 Territorial Energy Payments 8.3 Separate Scheduled Energy Payments 8.4 System Station Service Payments ARTICLE IX - BILLING AND COLLECTIONS 9 '.1 Presentations and Payment of Bills for Capacity Payments 9.2 Presentation and Payment of Bills for Energy Payments 9.3 Reimbursement for Inaccurate Charges (Final ~ Accounting) 9.4 Availability of Records 9.5 Interest on Overdue Amounts 9.6 Failure to Make Payments 3
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ARTICLE X - REPRESENTATIONS, WARRANTIES AND LEGAL OPINIONS 10.1.Oglethorpe Representations and Warranties l
10.2 Georgia Power Representations and Warranties N
10.3 Delivery of Legal opinion to Georgia Power 10.4 Delivery of Legal Opinion to Oglethorpe ARTICLE IX - CERTAIN ADDITIONAL AGREEMENTS 11.1 No Requirement of Service and Non-Liability 11.2 Suspension of Payments 11.3 Managing, Rebuilding, Repairing and Repowering the Units 11.4 Attribution of Responsibility for the Units
- 11.5 Limitation of Liability 11.6 AEC Settlement and Oglethorpe's Self-Sufficiency g
11.7 Equity Return on Buy-Back Capacity 11.8 Character of Sale and No Third l
Party 11.9 Acknowledgment of Unit Power Sale Contracts 11.10 Approvals ARTICLE XII - ALIENATION AND ASSIGNMENT 12.1 No Assignment 12.2 Resale 12.3 Successors and Assigns
-iii-
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ARTICLE XIII - MISCELLANEOUS PROVISIONS 13.1 Interrelationship'with the Georgia p-Coordinated Resources Agreement
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-13.2 Provisionslof the Georgia Coordinated Resources Agreement Specifically Incorporated by Reference p
13.3' General Cost Principles 13.4 Governing Law 13.5
.No Delay and No Waiver y'
13.6.
Notice
' 13. 7.
Article and Section Headings 13.8 No Partnership 13.9 Time of the Essence 13.10 Amendments 13.11 Counterparts 13.12' Further Assurances g
13.13 Including Exhibits-ra.
Exhibit "A"
Nameplate Capacity and Allocated Nameplate Capacity of Each Unit Exhibit "B"
Power Sale Manual Exhibit "C"
Power Sale Informational Schedule Exhibit "D"
Current List of Oglethorpe's Member Electric Membership Corporations Exhibit "E"
AEC Settlement List of Oglethorpe's Member Electric Membership Corporations 1
-iv-
POWER' SALES AGREEMENT This POWER SALES AGREEMENT (the " Agreement") is-ent'ered'into as of 198__ between GEORGIA l
POWER COMPANY, a corporation organized'and existing under
?
L the laws'of the State of Georgia (" Georgia Power"), and l-OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP-GENERATION & TRANSMISSION CORPORATION), organized and existing under Title 46 of the Official Code of Georgia Annotated-("Oglethorpe").
H I I'N E S S E I H:
WHEREAS, Georgia Power agrees to sell and Oglethorpe agrees to purchase capacity and associated energy in accordance with the terms and conditions of this' Agreement; NOW, THEREFORE, FOR AND IN CONSIDERATION of the p:
premise, the mutual promises and agreements set forth herein and other good and valuable consideration,'the receipt, sufficiency and adequacy of which are hereby acknowledged, Georgia Power and Oglethorpe, each intending to be legally bound, hereby agree as follows:
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ARTICLE I DEFINITIONS J
1.1 Plant' Definitions.
In addition to the initially l
' capitalized terms and phrases defined in the preamble of i'
this Agreement.or in Section 1.2, the following initially o
- capitalized terms and phrases as and when used in this
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' Agreement shall have the respective meanings set forth below:
(i)
"Arkwright 1" - means Unit Number 1 at j
Plant Arkwright.
(ii)
"Arkwright 2" - means Unit Number 2 at
' Plant Arkwright.
(iii)
"Arkwright 3" - means Unit Number 3 at Plant Arkwright.
(iv)
"Arkwright 4" - means Unit Number 4 at Plant Arkwright.
J (v)
"Atkinson 1" - means Unit Number 1 at Plant Atkinson.
f (vi)
"Atkinson 2" - means Unit Number 2 at Plant Atkinson.
(vii)
"Atkinson 3" - means Unit Number 3.at Plant Atkinson.
l (viii)
"Atkinson 4" - means Unit Number 4 at Plant Atkinson.
(ix)
"Bowen 1" - means Unit Number 1 at Plant Bowen.
1 J l
_a
N' F
"Bowen 2" - means Unit Number 2-at Plant (x) a y,
~Bowen.
V.
~ (xi)
"Bowen 3" - means Unit Number 3 at Plant
'Bowen.
h (xii)
"Bowen 4" - means, Unit Number 4 at-Plant-Bowen.
l (xiii)
- Branch 1" - means Unit Number 2 at Plant Branch.
(xiv)
" Branch 2" - means Unit Number 2 at Plant Branch.
(xv)
" Branch 3" - means Unit Number 3 at Plant Branch.
(xvi)
" Branch 4" - means Unit Number 4.at Plant-Branch.
(xvii)
" Combustion Turbines" - means, collectively, the following combustion turbine electric generating facilities:
4 (xviii)
"Hammond 1" - means Unit Number 1 at Plant Hammond.
means Unit Number 2 at (xxix)
"Hammond 2'?
Plant Hammor'd.
(xx)
"Hammond 3" - means Unit Number 3 at Plant Hammond.
e (xxi)
"Hammond 4" - means Unit Number 4 at Plant liammond.
I 3-
_.. _ _ _ _. _ _. ~ _. _.
__m_.___
__x__-.
___._______.A___.___m_..____.__.___.d-.__An____.._____.m.__._______.__
_._mm__m____o
5 h
r
'(xxii)
"McDonough'1"'- means Unit Number 1 at Plant McDonough..
(xxiii)
"McDonough-2" means Unit Number 2 at Plant.McDonough.'
(xxiv)- "McManus 1" - means Unit. Number.1 at 8
Plant'McManus.
(xxv)
"McManus 2" - means Unit Number 2'at Plant McManus.
b (xxvi).
"Mitchell 1" - means Unit Number 1 at 1
Plant Mitchell.
(xxvii)
"Mitchell 2" - means Unit Number 2 at n
Plant Mitchell.
(xxviii)
"Mitchell 3" - means Unit Number 3 at Plant-Mitchell.
(xxix)
" Plant Arkwright" - means that certain electric generating facility, known as Plant Arkwright, owned by Georgia Power and located in Bibb County, Georgia.
- (xxx)
"Plent Atkinson" - means that certain electric generating facility, known as Plant Atkinson, owned by Georgia Power and located in Cobb County, Georgia.
(xxxi)
" Plant Bowen" - means that certain electric generating facility, known as Plant Bowen, d
i owned by Georgia Power and located in Bartow County, Georgia. i
}.
l L
(xxxii)- " Plant Branch" - means that certain electric generating facility, known as Plant Branch,
. owned by Georgia Power and located 3h Putnam County, Georgia.
l1 (xxxiii)
" Plant Hammond" - means.that certain N
electric. generating facility, known as Plant Hammond, owned by Georgia Power and located in Floyd County, Georgia..
O L
(xxxiv)
" Plant McDonough" - means that-certain lr
[
electric. generating facility, known as Plant i
McDonough, owned by Georgia Power and located in Cobb County, Georgia.
-(xxxv)
" Plant McManus" - means that certain l'
electric generating facility, known as Plant McManus, owned by Georgia Power and located in Glynn County, Georgia.
(xxxvi)
" Plant Mitchell" - means that certain 4
electric generating facility, known as Plant Mitchell,
. owned by Georgia Power and located in Dougherty County, Georgia.
l (xxxvii)
" Plant Yates" - means that certain l
L electric generating facility, known as Plant Yates, owned by Georgia Power and located in Coweta and l.,
Carroll Counties, Georgia.
l-l l
-s-3 l
4 L--
tw
L
.(xxxviii)
"Yates la - means Unit Number 1-at Plant Yates..
-(xxix)
"Yates 2" - means Unit Number 2 at Plant Yates.
(x1)
"Yates 3" - means Unit Number 3 at Plant l
Yates.-
L (xli)
"Yates 4" - means Unit Number 4 at Plant Yates.
- s (xlii)
"Yates 5" - means Unit Number 5 at Plant Yates.
(x1111)
"Yates 6" - means Unit Number 6 at Plant Yates.
(xlis "Yates 7" - means Unit Number 7 at Plant Yates.
- 1. 2 Non-Plant Definitions.
In addition to the initially capitalized terms and phrases defined in the y.
preamble of this Agreement
.,r in Section 1.1, the following initially capitalized terms and phrases as and when used in this Agreement shall have the respective meanings set forth below or in the Section of this Agreement referenced below, as the case may be:
(i)
" Adjusted capacity Charge" - is defined l
in Section 8.1.
. l
Tl"v-~
(ii).
"AEC Settlement" - means, collectively,.
[A] that certain Settlement Agreement entered into as l-.
F of April 24, 1974 between Georgia Power Company., the 1
Georgia Munic'ipal. Association, Inc. and the 1
l municipalities identified.in Attachment A-1 to such Settlement Agreement, th3 City of Dalton, Georgia, acting by and:through its Board of Water, Light and Sinking Fund Commissioners, the Georgia Electric h'
Membership Corporation and the electric membership corporations' identified in Attachment A-2 to such Settlement Agreement, and the Crisp County Power W
Commission, including without limitation all Attachments to such Settlement Agreement, and [B) those conditions set forth in
[ Note:
We will add a reference to the license of
' Hatch and Vogtle and to the construction
~
permit of Vogtle.)
k (iii)
" Affiliate" - of any specified corporation means any other corporation directly or
. indirectly controlling or controlled by or under direct or indirect common control with such specified l
corporation.
For purposes of this definition,
" control" when used with respect to any specified corporation means the power to direct the management and policies of such corporation, directly or _.
-e, L
p.
. indirectly,Jwhether through the ownership of voting
- i. _
g securities,: by contract or otherwise; and the terms-p l
" controlling" and " control" have meanings correlative w
to:the' foregoing.
" Affiliates" of any specified W
' corporation means more than one Affiliate of the specified corporation.
I E
(iv)
" Allocated Nameplate Capacity" - is j
defined in Section 3.l(b).
(v)
" Capacity Charge" - is defined in Section' 8.- l.
(vi)
" Composite Station Service Loss Factor" -
is defined in Section 4.3.
(vii)
" Composite Step-Up Loss Factor" - is defined in Section 4.2(b).
(viii)
" Energy Supply Plan" - is defined in
~ Section 4.5.
gp (ix)
" Federal ~ Power Act" - means the Federal.
Power Act, 16'U.S.C.A SS 791a-828c (West 1985 & Supp.
1988), as.the same may hereafter be amended from time to time.
(x)
"FERC" - means the Federal Energy Regulatory Commission or any Governmental Agency preceding or succeeding to the powers and functions thereof under the Federal Power Act.
I o t__..____m.___
-, - - -, - - - _ - =
1 (xi)
" Georgia Coordinated Resources Agreement" j
l means1that certain Georgia Coordinated Resources 1
x Agreement between Georgia' Power and Oglethorpe dated F
as of 198_.
1 (xii)
" Georgia Territory" - means the
?
geographical territory contained in the State of' Georgia, excluding the geographical territory contained in'each of Chatham, Effingham, Fannin, Towns I
and Union Counties, Georgia.
(xiii)
" Governmental Authority" - means any local, state, regional or federal administrative, legal, judicial or executive agency, commission, department or other such entity, but excluding any such agency, commission, department or other entity acting in its capacity as lender, guarantor or mortgagee.
' Governmental Authorities" - mean more than one Governmental Authority.
O (xiv)
"IIC" - means that certain document, The Southern Company System Intercompany Interchange Contract among Georgia Power and certain of its Affiliates, approved in FERC Docket No. ER86103-001, as the same may be hereafter amended, or any successor agreement among Georgia Power and its Affiliates for
[
coordinated operations.
l.
L (xv)
" Nameplate Capacity" - of each Unit is defined in Sections 3.1(b).
e
_g.
l l
l-
_. _ =. -. _ _ - _ _ _ _ _ _ _
L t
-(xvi)"
" Net-. Dependable Capacity" - of each Unit
.is defined in Section 3.2(c).
(gvii)
" Periodic System Station Service Payments" - is defined in Section 8.4..
s (xviii)
" Power Sale Informational Schedule" -
a means any schedule completed by Georgia Power-pursuant to Section 7.2 substantially in the form of Exhibit-
"C" attached hereto, p
(xix)
" Power Sale Manual" - means that certain-Power Sale Periodic Rate Computation Procedure Manual of Georgia Power. Company. attached hereto and incorporated herein as Exhibit "B."
(xx)
" Prudent Utility Practices" - means, at'a particular time, any of the practices, methods and acts engaged.in or approved by.a significant portion of the electric utility industry prior to such time,
- or.any of the practices, method and acts which, in the exercise of ressonable judgment in light o'f the facts known at the time the decision was made, could have been expected to accomplish the desired results at a b
reasonable cost consistent with good business practices, reliability, safety and expedition.
" Prudent Utility Practices" is not intended to be o
limited to the optimum practice, method or act to the i
exclusion of all others, but rather to be a spectrum I
l of possible practices, methods or acts expected to accomplish the desired results.
h 4xxi)
"PS Capacity" - is defined in 1:
L Section 3.2(d).
l-(xxii)
"PS Energy" - is defined in Section s
4.2(d).
l' (xxiii)
"PS System Station Service Energy" - is l
drfined in Section'4.3.
u" (xxiv)
"REA" - means the Rural Electrification Administration, an agency of the United States Department of. Agriculture, or any Governmental Agency
' succeeding to the powers and functions thereof.
(xxv)
" Term" - is defined in Section 2.1.
(xxvi)
" Unit" and " Units" - are each defined in
~
Section.3.1(a).
(xxvii)
" Unit Composite Station Service-Energy"
{
- for each Unit is defined in Section 4.2(a).
(xxviii)
" Unit Net Electrical Output" - of each l
Unit is defined in Section 4.2(a).
(xxix)
" Unit Net Positive Generation" - of each Unit is defined in Section 4.2(a).
(xxx)
- Unit PS Capacity" - of each Unit is defined in Section 3.2(d).
(xxxi)
" Unit PS Ratio" - of each Unit is defined in Section 3.2(b).
i 11_
g
-(xxxii)
" Unit PS System Station Service Energy" -
for each Unit is defined in Section 4.3.
Io (xxxiii)
" Unit Separate PS Energy" - for each Unit is defined in Section 4.2(c).
(xxxiv)
" Unit System Station Service" - for each Unit'is defined in Section 4.2(a).
(xxxv)
" Unit Territorial Energy Charge" - for each Unit is defined in Section 8.2.
A (xxxvi)
" Unit Territorial PS Energy" - for each Unit is defined in Section 4.2(b).
ARTICLE II TERM OF AGREEMENT 2.1 Term.
The " Term" of this Agreement shall begin on,the later.of January 1, 1989 or the date on which the FERC allows this Agreement to become effective and shall p
continue through December 31, 2006 inclusive, subject to L1 prior termination only in accordance with Section 2.3.
1 I
2.2 C'ondition Precedent to Effectiveness.
The respective obligations of Georgia Power and Oglethorpe to l
consummate the transactions contemplated in this Agreement are conditioned upon the receipt py Georgia Power of i
approval of this Agreement from the FERv.
j l
l l
1 4 4
~
l A-----____-._L_._-______-_._.____..____----.
g l
2 ~. 3 Rights to Terminate.
(a) Georgia' Power and Oglethorpe acknowledge that the effectiveness of this
~
Agreement Is conditioned upon the approval of the FERC as set forth in Section 2.2.
Should the FERC not grant L,
approval of this Agreement in substantially the form in which it is agreed to by Georgia Power and Oglethorpe and filed with such Governmental Authority, then either
(
Georgia Power or Oglethorpe may terminate this Agreement r'
in its respective sole discretion.
Georgia Power or Oglethorpe may elect to exercise such right to terminate only within the
(
) day period:
f l
(i) following the issuance of a Final Order by the FERC either rejecting this Agreement or approving this Agreement as modified (so that this Agreement is not in substantially the agreed-upon and
~
filed form), modified, which Final Order is not l
L appealable by any person or entity; or s
l.
(ii) if such a Final Order is issued and is appealable by any' person or entity, then following the expiration of all periods within which such an appeal can be filed by any person or entity with no such appeal having been filed.
If Georgia Power or Oglethorpe elects to exercise such right to terminate, then the electing party shall deliver a written notice of such election to the other within the aforementioned period, and this Agreement will be deemed l -
h I.
l to have been terminated effective upon the date of the other's receipt of such written notice.
(b)
Within'
'(.
) dayp of the date of Georgia Power's receipt of FERC approval of this Agreement which i
satisfies the condition precedent set forth in Section j
[
2.2, Oglethorpe shall cause to be delivered to Georgia
{
Powers (i) an instrument in a form acceptable to Georgir.
k Power from each and every one of the member electric membership corporations listed in Exhibit "E" (which is attached hereto and incorporated herein by this reference), each of which instruments is executed by and is binding on and enforceable against the i
respective member electric membership corporation executing such instrument, and in each of which
. instruments the respective member electric membership corporation:
(A) agrees that the undertakings made in w
this Agreement by Georgia Power completely fulfill any and all obligations that Georgia Power may now or hereafter have under the AEC Settlement (including without limitation under paragraph 4(b) of Attachment B thereto), or under Attachment B to the AEC Settlement as incorporated in
, to provide i
full requirements power, partial requirements power, i
or both full requirements power and partial requirements power, to such member electric membership corporation or to Oglethorpe on behalf of such member -
_ _ ______- _ - _ _ a
L e
' electric membership corporation;fand (B] releases Georgia Power from any.and all' liability to such
~
member electric membership corporation in~ connection with, and waives any and all rights that suchimember y
- electric membership corporation may have to enforce, the referenced obligations under or-connected with the-AEC Settlement, with.both such release and such waiver 4
being effective on and after the effective date of this Agreement; or l
(Note:
The' blank will be filled in with a identification of the Vogtle and Hatch licenses.)
(ii)' opinion letters from Messrs. Paul, Hasting, Janofsky & Walker, counsel for Oglethorpe, and Charles T. Autry, General Counsel for Oglethorpe, each.
~
_of which is dated the effective-date of the FERC i
approval which satisfies the condition precedent. set
~
P
'forth in.Section 2.2(a),'and each of which reaffirms the opinions given by the signatory in the opinion letter required pursuant to Section 10.3 to have been j
effective as of the date of execution of this i
Agreement.
'If Georgia Power has not received all of the documents g
I' required pursuant to (i) and (ii) of this Section 2.3(b)
{
i on or before the end of such
(__) day period, then Georgia Power may, in its sole discretion, i
4
terminate the Agreement at any time after the end of such
(__) day period, unless and until. Georgia
,y Power has received all of the documents required pursuant to (i) and (ii) of this Section 2.3(b).
If Georgia Power elects to exercise such right to terminate, then Georgia Power shall deliver a written notice of such election to Oglethorpe, and this Agreement will be deemed to have been l
terminated effective upon the date of Oglethorpe's receipt of such written notice.
(c)
Georgia Power shall, within the
(
) day period' set forth in Section 2.3(b), cause to be delivered to Oglethorpe an opinion letter from Messrs. Troutman, Sanders, Lockerman and Ashmore, counsel for Georgia Power, which is dated the effective date of the FERC approval which' satisfies the condition precedent set forth in Section 2.2(a), and which reaffirms the opinion given by the signatory in the opinion letter required pursuant to Section 10.4 to have been effective as of the date of execution of this Agreement.
If Oglethorpe elects to exercise such right to terminate, then Oglethorpe shall deliver a written notice to Georgia Power, and this Agreement will be deemed to have been terminated effective upon the date of Georgia Power's receipt of such written notice.
(d)
Except as set forth in Sections 2.3(a), 2.3(b) and 2.3(c) or in a writing duly executed by each of a
')
g L
l
(
)
. Georgia Power and Oglethorpe, neither Georgia Power nor
'i Oglethorpe may terminate'this Agreement'for any reason L
P-whatsoever.
i 2.4 Date of Expiration or Termination.
Oglethorpe i
N agrees that.this Agreement will expire on December 31, L
2006 as set.forth in Section 2.1 or shall terminate 1
effective as of the date determined in accordance with j
Sections-2.3(a), 2.3(b) or 2.3(c).
Oglethorpe agrees that f
it will not seek to purchase any capacity or associated energy or to' schedule any transactions under this h.
Agreement after the-date of expiration or termination determined as aforesaid.
L ARTICLE III
~
CAPACITY
'3.1 Identification of the Units and Certain Definitions.
ta) The electric generating units from which Georgia Power will make capacity and associated energy available to Oglethorpe pursuant to this Agreement are the following:
(i)
Arkwright 1 (December 31, 2001)
(ii)
Arkwright 2 (December 31, 2001) l l
L (iii)
Arkwright 3 (December 31, 2001)
(iv)
Arkwright 4 (December 31, 2001) 1 1 _ _ _ _ _ _ _ _ - _ _
hi
(-l \\
(v)j
~Atkinson 1 (December 31, 1999) f b
(vi)
Atkinson 2 (December. 31, 1999)
NL.
rr ivil)
Atkinson 3 (December 31, 1999)
(viii)-
Atkinson 4 (December'31, 1999)
(.
(ix)
Bowen 1 t:
(x)
Bowen:2
( xi) ~
.Bowen 3 (xii)
Bowen 4
.(xiii)
Branch 1 (xiv)
. Branch 2 (xv)
Branch 3 (xvi)
Branch 4 (xvii)
Hammond 1 (December 31, 2000)
(xviii)
Hammond 2 (December 31, 2002)
(xix)
Hammond 3 (December 31, 2004)
(xx)
Hammond 4 (xxi)
McDonough 1 (xxii)
McDonough 2 (xxiii)
McManus 1 (December 31, 2000)
(xxiv)
McManus 2 (December.31, 2000)
(xxv)
Mitchell 1 (December 31, 2000) i (xxvi)
Mitchell 2 (December 31, 2000) i (xxvii)
Mitchell 3 1
(xxviii)
Yates 1 (December 31, 2001)
(xxix)
Yates 2 (December 31, 2003)
(xxx)
Yates 3 (December 31, 2005) b
-18 ~
Gb' I,
i o
a.j l
-(xxxi)
'Yates 4
'(xxxii)
Yates 5 7
(xxxiii)
Yates 6 3
(xxxiv)
Yates 7 (xxxv) the Combustion Turbines g
Except to the extent otherwise set forth in this.Section i
3.1(a)'or in Section 11.3, the electric generating units listed in (1) through (xxxv) of this Section 3.1(a) shall be referred to collectively as the " Units" and singularly as a " Unit."
In the case of the combustion turbine electric generating facilities that comprise the Combustion Turbines, all of such combustion turbine generating facilities shall collectively comprise one (1)
Unit.
Each of the Units named in (i) through (xxxv) of this Section 3.1(a), which has a date set forth in parentheses next to.the name of the Unit, shall be deemed d
for purposes of this Agreement no. longer to be a Unit from and after the date so set,forth next to the name of such Unit.
For that portion of the Term from and after such date, Oglethorpe shall have no entitlement under this Agreement to any capacity or associated energy from such Unit.
In addition, all of the combustion turbine electric p
generating facilities that comprise the Combustion Turbines shall cease to be or comprise a Unit from and after December 31, 2000, and from and after December 31, 2000, Oglethorpe'shall have no entitlement to any capacity '
m- _
__._._.m.__.
,\\ - -
or' associated energy from any or all of such combustion turbine electric generating facilities that comprise such Unit.
(b)
The " Nameplate Capacity" of each Unit is set forth in column 2 of table 1 in Exhibit "A" (which is V
attached hereto and incorporated herein by this reference) opposite the name of such Unit as set forth in Column 1 of such table.
The " Allocated Nameplate Capacity" of each Unit for each calendar year during the Term shall be as set forth in columns 2 through 9 of table 2 in Exhibit "A"
opposite the name of such Unit as set forth in Column 1 of such table.
3.2 Determination of Capacity to be Purchased and Sold.
(a) Georgia Power and Oglethorpe agree that the actual amount of capacity to be sold by Georgia-Power and purchased by Oglethorpe from each of the Units pursuaht to e,
this Agreement will vary from time to time during the Term or during such shorter period of time as each such Unit is
- subject to this Agreement.
The nominal schedule of the capacity to be sold by Georgia Power and purchased by Oglethorpe during relevant periods of the Term pursuant to this Agreement, based on the Nameplate Capacity of each of the Units, is as follows:
~ 1 l
- ro lv Period
~ Capacity (Megawatts)
January 1,-1989 through December 31, 1999 1400.0 k
January 1, 2000 through December 31, 2000 1380.8 i'
January.1,.2001 through December' 31, 2001 1200.0
-JanuaryL1,;2002 through December 31, 2002
'1000.0 January-1,12003 through December 31, 2003 800,0
. January 1, 2004 through December 31, 2004 600.0-January-1, 2005 through December 31, 2005 400.0 k.
Januarytl, 2006 through December 31, 2006 200.0 l
(b)- At any given time during the-Term, the " Unit PS Ratio" for each Unit will be equal to the quotient of
(
(i) the Allocated Nameplate. Capacity of such Unit at such time; divided'by.(ii) the Nameplate Capacity of such-Unit.
(c)
The " Net. Dependable Capacity" of each Unit for each calendar year during the Term shall be determined for each such calendar year on or before the fifteenth (15th) day of September of the preceding calendar year and shall'
~
be that amount'which is determined in accordance with the procedures set forth in the IIC.
(d)
The " Unit PS Capacity".of each Unit to be sold by I
Georgia Power and purchased by Oglethorpe under this Agreement at any given time during the Term shall be equal to the product of:
(i) the Net Dependable Capacity of such Unit at such time; and (ii) the Unit PS Ratio of such Unit at such time.
The term "PS Capacity" shall sometimes be used herein to refer to the aggregate of the Unit PS-Capacity of each of the Units at any relevant time.
The amounts of the Unit PS Capacity of any Unit and the PS
-Capacity shall be subject to adjustment as necessary in light of any action by Georgia Power under Section 11.2(b).
~ !
=
y 1
s.
3.3 Entitlement to capacity.
At any'given: time during.the Term,:.Oglethorpe shall be entitled to that.
c p
amount!of the available capacity.of.each of the Units J
which equals the product'of:
(i) the available' capacity of'such Unit at such time; and (ii) the Unit PS Ratio of such Unit at'such time.
ARTICLE IV ENERGY 4.1 Entitlement to Energy.
(a) During any'given period of the Term, Oglethorpe shall be entitled to that amount of the energy produced by each of the Units during such period for consumption within the Georgia Territory which-is equal.to the_ product of:
(i) the amount of-energy produced by such Unit during such period for-consumption within the. Georgia Territory; and (ii) the j
' Unit PS Ratio of such Unit at such time.
GPC shall determine from time to time, in accordance with-its then current' procedures for making such determination, the quantities of energy produced by each of the Units for consumpt!on within the Georgia Territory, and Oglethorpe may use sut5 energy only within the Georgia Territory.
(b) 'In eddition, at any time during which one or more I
of the Units'are being operated in accordance with oglethorpe's' separate schedule pursuant to the provisions
n r
of Section 6.2, Oglethorpe shall be entitled to the energy produced by each of the Units in accordance with such separate schedule.
GPC shall determine from time to time, in its sole discretion, the quantity of energy available in the Units for separate scheduling by Oglethorpe pursuant to the provisions of Section 6.2, and Oglethorpe must deliver such energy for use outside the Georgia Territory.
I N
4.2 Determination of Energy to be Purchased and Sold.
(a) The " Unit Net Electrical Output" of any Unit during any period of the Term shall be equal to the difference between:
(i) the energy produced by such Unit during such period; minus (ii) the Unit Composite Station Service Energy consumed by or for such Unit during such period.
If the Unit Net Electrical Output of a Unit during any given period of the Term is greater than zero
(-0-),
then the Unit Net Electrical Output during such period shall be referred to herein as the " Unit Net Positive Generation" of such Unit during such period.
If the Unit Net Electrical Output of a Unit during any given period of the Term is less than or equal to zero
(-0-),
then the absolute value of the Unit Net Electrical Output during such period shall be referred to herein as the
" Unit System Station Service" for such Unit during such period.
The " Unit Composite Station Service Energy" consumed by or for a Unit during any given period of the
o p.
r i
LTerm means the station service' energy consumed by or for b
p
'such Unit during such period as determined-in'accordance
- with Georgia Power's.then current procedures for' making.
such' determination ~for such Unit.
p (b)
The " Unit Territorial PS Energy" to be sold by Georgia' Power and purchased by Oglethorpe under this Agreement from each Unit'during any period of the Term is.
equal to the product of (i) the Composite Step-Up' Loss 7
Factor; and (11) that portion of the Unit Net Positive Generation of such Unit during such period to which Oglethorpe is entitled pursuant to Section 4.1(a).
The
" Composite Step-Up Loss Factor" is the number Nine Thousand Nine Hundred Sixty-Eight ten-thousandths (0.9968).
(c)
The " Unit Separate PS Energy" to be. sold by-Georgia Power and. purchased by Oglethorpe under this Agreement from each Unit during any period of the. Term is equal to.the-product of:
(i) the Composite Step-Up Loss Factor; and (ii) that_ portion,of the Unit Net Positive Generation of such Unit during such period to which Oglethorpe is entitled pursuant to Section 4.l(b).
(d)
The tern "PS Energy" shall sometimes be used herein to refer to the aggregate of the Unit Territorial PS Energy and the Unit Separate PS Energy from each'of the L
Units during any relevant period. "
4.3 Determination of Station Service Energy Consumed.
The " Unit PS System Station Service Energy" consumed by or for each Unit during any period of the Term is equal to the product of:
(i) the Composite Station Service Loss Factor; (ii) the Unit System Station Service
)
of suct: Unit during such period; and (iii) the Unit PS Ratio of such I' nit at such time.
The " Composite Station Servi:e Loss Factor" is the number One and Thirty-Two ten-thousandths (1.0032).
The term "PS System Station Service Energy" shall sometimes be used herein to refer to the aggregate of the Unit PS System Station Service Energy for each Unit during any relevant period.
4.4 Deemed Receipt and Consumption of Energy by oglethorpe.
Oglethorpe shall be deemed to have received all'PS Energy and is responsible for payment therefor in accordance with ARTICLES VIII and IX.
Oglethorpe shall also be deemed to have consumed all PS System Station Service Energy and is responsible for payment therefor in accordance with ARTICLES VIII and IX.
4.5 Energy Supply Plan.
Georgia Power shall prepare and submit to Oglethorpe an energy supply plan for PS Energy for the first five (5) calendar years of the Term (the term -Energy Supply Plan" means this energy supply plan for PS Energy and each sn-t anergy supply plan for PS I ;
u-
1 i
Snergy subsequently prepared and submitted pursuant to
)
this Section 4.5).
Each year thereafter, Georgia Power 7
shall subm'it a five (5)-year Energy Supply Plan to 1
Oglethorpe with each Power Sale Informational Schedule.
3 Each Energy Supply Plan shall include without limitation the energy projected to be. produced by the Units for consumption within the Georgia Territory and Oglethorpe's projections of needs for separate scheduling pursuant to the provisions of Section 6.2 and shall be supported by detail reasonably adequate for Oglethorpe's review thereof.
Neither Georgia Power nor Oglethorpe, nor any Affiliate of either (which Affiliate is assisting Georgic 1
Power or Oglethorpe, as the case may be, in its l
performance under thia Section 4.5), makes any representations, warranties or promises of any kind that
~
any attempt to produce energy from any or all of the Unita in accordance with the Energy Supply Plan will be a
successful, and in no event shall Georgia Power, Oglethorpe or any Affiliate of either have any liability to the other or to any Affiliate of the other in these regards.
ARTICLE V R
DELIVERY POINT AND METERING 5.1 Delivery Point.
Georgin Power shall deliver energy from each of the Units to Oglethorpe pursuant to i-
.________-_n
b L
this Agreement at the high side of the step-up transformers at such Unit.
9 l
e 5.2 Metering.
Georgia Power shall maintain the l
necessary metering equipment to determine capacity and n
energy and station service energy at the generator termi-nals of each of the Units.
Metering records shall be available at all times to authorized representatives of Oglethorpe.
Each meter used pursuant to this Section 5.2 shall, by comparison with accurate standards, be tested and calibrated by Georgia Power at approximate intervals cf twelve (12) u3ntha.
It a meter shall be found not regiytoring within one percent (1.0%) accuracy, it shall ba restored to an accurate condition or an accurate meter
.shall be substituted.
The results of all tests and cali-brations shall be open to examinatica by Oglethorpe.
Any meter tested and found to be within one percent (1.0%)
L accuracy shall be considered to be accurar,e.
If, as a result of any test, any meter is found to register not within one percent (1.0%) accuracy, the read'ings of such meter previously taken shall be corrected according to the percentage of inaccuracy so found, but no such corrections shall extend beyond sixty (60) days previous to the day on which such inaccuracy was discovered by such test.-
If any metering equipment fails to register or if the meter regi-stration is erratic, then the capacity of and associated
. g
t energy produced by the Unit or Units affected shall be pj determined by Georgia Power.
All costs incurred in connection'with such metering equipment and compliance with the provisions of this Section 5'.2 shall be y
considered an. operation and maintenance expense and as such shall be borne by Oglethorpe in accordance with Article IV of the Power Sale Manual, w
ARTICLE VI L
DISPATCH AND SCHEDULING j
t 6.1 Dispatch.
Georgia Power shs11 have sule; l
authority for the ccheduling cnd dispatching of energy from each of the Units and shall schedule and dispatch l
~
such energy on a continuous economic dispatch basis, te q
l thE extent each such Unit is capable of such dispatch, in accordance with Georgia Power's standard scheduling and g
dispatching procedures to serve, in part, the electric capacity and energy load within the Georgia Territory.
6.2 Separate Scheduling.
Oglethorpe may request Georgia Power to develop the programs and procedures necessary for Oglethorpe to exercise the right to submit separate schedules for the delivery of energy from i Unit in excess of the Unit Territorial PS Energy from such Unit up to Oglethorpe's entitlement to energy from such Unit as.
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detcominid purcu2nt to S ction 4.1(b).
Oglothorpe must make any such request to Georgia Power in a writing or 1..
L writings which set forth in detail all available infor-W mation with. respect to the anticipated quantitie's, characteristics and destinations of'such anticipated g
separate schedules and any and all other information and L
understandings which may be required by Georgia Power in-order to facilitate development of the necessary programs l
and procedures to implement the anticipated separate l
l schedules.
Georgia Power will, at Oglethorpe's expense, L
estimate the cost associated with developing such programs ar.d proceduros.
Upon payment by Oglethorpe to-Georgie Power of such estimated cost, Georgia Power will proceed to develop such progre.ms and procecures.
Upon completion of the development of such progra. ' and procedures, Georgia Power will provide Oglethorpe with d. documentation f
of the actaal development costa and a refund of any.over.
payment or a bill for sny underpayment.
Notwithstanding H-i the provisions of Section 6.1, Georgia Power will imple-ment or cause to be implemented dispatch of energy from a.
Unit or Units for delivery by Oglethorpe outside the Georgia Territory pursuant to such programs and procedures in accordance with a separate schedule or separate sche-duler.of Oglethorpe, if for each such separate schedule
~
Oglethorpe has given Georgia Power copies of contracts that Georgia Power has determined are sufficient to allow 4
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i l-for the' delivery outside of the Georgia Territory of such separately scheduled energy from such Unit or Units; I
-provided that Oglethorpe has paid. Georgia Power in full for all costs. incurred by Georgia Power for' developing the necessary programs and procedures necessary or appropriate-to bnplement such separate schedule or separate schedules, l.
including'without limitation any such costs that are the L
subject of a bill for underpayment.
p ARTICLE VII PROCEDURE FOR CAPACITY AND ENERGY CHARGES 7.1 Periodic Charges Computation Procedpro.
Georgza-Power and Oglethorpe recognize that the cost of providing-l-
the Unit'PS Capacity, Unit PS Energy and Unit PS System Station Service Energy for each Unit as contemplated l.
herein may change during the term of this Agreement, p
l-Thus, in order for Georgia Power to be compensated fairly and adequately, it will be necessary to revise or update, l
on a periodic basis, the cost, expense and investment figures utilized in the derivation of the capacity charges and certain components of the energy charges provided for in this Agreement.
In order to facilitate revisions or updates of the charges calculated under the basic procedure and methodology outlined in this Agreement, Georgia Power has adopted the Power Sale Manual, which l-
- L_
z____
1 describes in detail the methodology and procedures to be utilized in the periodic calculation of charges provided 1
for in this Agreement.
The Power Sale Manual, together with this Agreement, shall serve as a formulary rate allowing periodic revisions of the charges to reflect s
changes in costs of providing the capacity and associated energy as contemplated by this Agreement.
The capacity charges calculated in accordance with the Power Sale Manual will be shown on the Power Sale Informational Schedule described in Section 7.2.
'7. 2 Power,Spie International Schedule.
Georgia Power 4
still cubnit to Oglethorpe a Power Sale Informational i
Schedule showing projected chargos for Unit PS Capacity under this Agreement during the first (1st) calendar year of-the Term.
Such Power Sale Informational Schedule will be revised as set forth below for each calendar year of the Term.
Revisions of projected charges contained in the Power Sale Informational Schedule shall follow the provisions of this Agreement and the methodology and procedure set forth in the Power Sale Manual.
Georgia Power shall submit a revised Power Sale Informational Schedule to Oglethorpe on or before November 1 of each calendar year of the Term (except the first and the last) for application commencing on January 1 of the following calendar year.
This time period will allow Georgia Power _ - _ _ _ _ - _ - - _ - - - _ _
=-.
I b
and Oglethorpe to verify that the projected charges contained in the revised Power Sale Informational Schedule have been computed in accordance with this Agreement and l
the methodology and procedure set forth in the Power Sale Manual.
Since the projected charges contained in the revised Power Sale Informational Schedule will be computed in accordance with the formulary rate method and procedures described in this Agreement and the Power Sale Manual, it is the intent of Georgia Power and Oglethorpe that such revisions will not be changes in rates which would require a filing and suspension under the Feder61 Fermr. Act snd the applicable rules and regulations cf the FERC promulgated thereunder.
7.3 Char,qes to thfnCapacity and Energy Chargee.
(a)
In_ addition to its rights to change the charges for Unit f
PS Capacity, Unit PS Energy and Unit PS System Station Service Energy for each Unit as described in Sections 7.1, l
J 7.2, 7.3(b) and 7.3(c), Georgia Power shall have the right to amend the formulary capacity and energy rates established in accordance with this Agreement, the Power Sale Manual and the then-current Power Sale Informational Schedule to change any or all of:
l (1) the provision for percentage return on equity capital; i -_-
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731 L.:
U
- ( 11)' step-up loss. factors, including without limitation the Composite-Step-Up Loss Factor; and e
b
- (11) station service loss factors, including without limitation the Composite Station Service Loss-Factor.
s Georgia Power shall have the right to unilaterally make application to the'FERC for such a. change in rates under~
g Section 205 of the Federal Power Act and' pursuant to the rules and regulations of the FERC promulgated thereunder.
Cglethorps.shallabo. free te, support or contest such application or ;aise any obje.: tion it may hade to such application before the FERC.
(b) 7.n addition to its rights to change the charges for Unit PS Capacity, Unit PS Energy and Unit PS System I'
Scation Service Energy for each Unit as.. described in Seations 7.1, 7.2, 7.3(a) and 7.3(c), Georgia Power shall further have the right to amend the formulary capacity and energy rates established in accordance with this Agreement, the Power Sale Manual and the then-current Power Sale Informational Schedule.to recoup in such-formulary capacity an'd energy rates any additional
~
legitimate cost not now in existence that Georgia Power incurs with cespect to charges for capacity and' energy (including without limitation those imposed by or on behalf of any Governmental Authority).
Oglethorpe agrees' to. support any and all such changes and to cooperate with D
~,
and assist Georgia Power in securing approval by the FERC of such additional charges.
(c)
In addition to its rights to change the charges for Unit PS Capacity, Unit PS Energy and Unit PS System Station Service Energy for each Unit as described in Sections 7.1, 7.2, 7.3(a) and 7.3(b), and as an alternative to its rights under Section 2.2, Georgia Power shall have the right to file one or more unilateral changes in the formulary capacity and energy rates established in accordance with this Agreement, the Power Sale Manual and the then-current Power Sale Infor Lational Schedule, if such rates provided for in this Agreement are I
disapproved or modified by the FERC.
Oglethorpe agrees to support any and all such changes and to cooperate with and ALuist Georgia Power in securing approval by the FERC of such change to the extent the change by Georgia Power would not result in the imposition of higher estimated charges to Oglethorpe than those which would have been produced under the Agreement prior to the action taken by the FERC.
ARTICLE VIII PAYMENTS FOR CAPACITY AND ENERGY 8.1 Capacity Payments.
Oglethorpe shall pay Georgia Power a capacity payment in accordance with Section 9.1 l l
H L
for each calendar month during the Term for the Unit PS L
Capacity of each Unit.
Such capacity payment for each 5'
Unit for apy calendar month during the Term shall be equal to the pro' duct of:
(i) the Capacity Charge; and (ii) the Unit PS Capacity'of such Unit during such calendar month..
The " Capacity Charge" is the dollar per kilowatt-month charge produced by the applicable formula set forth in Article II of the Power Sales Manual for the aggregate-4 capacity of all Units, 'If the Net Dependable Capacity of a Unit is' determined to bo zero (-0-) during any calendar
, yenr.of tho,Torm, than the capacity payment for ecch Unfe q
'l for each Calendar Month of such calendar yaar shall be-equal to the product of:
(iii) the. Adjusted Capacity Charge; and'either (iv)[A) in the case of ecch of the Units whose Net Dependable Capacity equals zero (-0-), the number of kilowatts of capacity to.which-Oglethorpe would
.have been entitled from such Unit, assuming that the Net m
Dependable Capacity of such Unit had equaled the Nameplate
. Capacity of such Unit, or (iv)[B) in the case of each of the Units whose Net Dependable Capacity does not equal zero (-0-),
the Unit PS Capacity of such Unit for such calendar month.
The " Adjusted Capacity Charge" is the dollar per kilowatt-month charge produced by the applicable formula set forth in Article II of the Power Sales Manual for the aggregate capacity of all Units, -
assuming that the Net Dependable Capacity of each of such Units whose Net Dependable Capacity in fact equals zero
(-0-) had instead equalled the respective Nameplate Capacity of such Unit.
Georgia Power shall true up the capacity payments for each Unit to reflect actual costs in accordance with Article VII of the Power Sale Manual.
8.2 Territorial Energy Payments.
Oglethorpe shall pay Georgia Power a territorial energy payment in accordance with Section 9.2 for each celendar month during the Term for the Unit Territorial PS Energy delivered to Jglethorpe from each Unit.
Such territorial energy payment for each Unit for such calendar month shall be equal to the product of:
(i) the Unit Territorial Energy Charge for such Unit; and (ii) the Ur.$.t Territorial PS Energy delivered to Oglethorpe from such Unit during such
~
calendar month.
The " Unit Territorial Energy Charge" for each Unit is the mills per kilowatt-hour charge produced
'by the applicable formula set forth in Articles III and IV of the Power Sale Manual for such Unit.
8.3 Separate Scheduled Energy Payments.
Oglethorpe shall pay Georgia Power a separate scheduled energy payment in accordance with Section 9.2 for each calendar month during the Term for the Unit Separate PS Energy 4.
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delivered to oglethorpe from each Unit.
Such separate g.
' scheduled energy-payment for each Unit for such calendar month shall be equal to the aggregate'of any and all costs
.resulting from the production of energy from such Unit in y'
accordance with Oglethorpe's separate schedule (s),
including without limitation all prepayments in connection c
with the acquisition of fuel and'the costs of. scheduling and dispatching services provided by Georgia Power y
r pursuant to or in the implementation of-Oglethorpe's separate schedule (s), whether or not Oglethorpe requires,
. takes or delivers any or all of such Unit Separate PS e
Energy and whether or not any or all of r,uch Unit Separate
.PS-Energy is generated.
Oglethorpe Egrees to indemnify
.j and hold Georgin Power harmless from and against any and all costs, expensec, liabilities and damages of any kind occasioned in any way by the operation of any or all of the Units in accordance with Oglethorpe's separate j
schedule (s),: including without limitation any and all-costs,. expenses, liabilities and damages that result from a deviation from the continuous economic dispatch in accordance with Georgia Power's standard scheduling and j
dispatch procedures to serve, in part, the electric capacity and energy load within the Georgia' Territory absent Oglethorpe's separate schedule (s).
1
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8.4: System Station Service Payments.
Oglethorpe shall pay Georgia Power a system station service payment in accorda~nce with'Section 9.I for each calendar month during the term hereof for the Unit PS System. Station 4
Service Energy consumed by or for each Unit.
For purposes l-of. determining the amount of such system station service payment for each Unit during such. calendar month, the Unit h.
PS System Station Service Energy consumed by or for such Unit during'such calendar month shall be measured over-the
-periods of time during such month called for by Georgia Power's then standard procedurec for auch measurements Such system station service payment shall bu equal to the aggregate of all of the Periodic System Station Service-Payments for such Unit during all such stsndard periods of v
such calendar month.
Each of the " Periodic System Station
~
Service Payments" for any Unit during a standard period of a calendar month shall be equal to the product of:
(i) v the Unit PS System Station Service Energy consumed by or for such Unit during such standard period of such calendar month; (ii) the incremental cost of energy in the Georgia 1
Territory during such standard period, as determined in accordance with Georgia Power's standard scheduling and dispatching procedures to serve, in part, the electric capacity and energy load within the Georgia Territory; and.
(iii) the Unit PS Ratio of such Unit during such period.
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ARTICLE IX BILLING AND COLLECTIONS
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9.1 Presentation'and Payment of Bills for Capacity Payments.
On or before December 1 of each calendar year, Georgia Power shall' send Oglethe.pe an invoice stating the capacity payments determined in accordance with Section
.i 8.1 that are required to be paid by Oglethorpe to Georgia p
Power during each calendar month of the ensuing calendar year.
To the extent the monthly capacity payments specified in any such. invoice change es a result of causes
~
specified in this Agreement, Georgia Pcwer.shall present j
an c.memiec invoice to Cglethorpe as scon es practice.ble after ruch change occurs.
On or before the fifteenth il5th)_ day of e9ch calendar month of the ensuing calendar year, Oglethorpe shall make payment to GPC in accordance
~
with the invoice or amended invoice in inimediately 3'
available funds through wiring of funds.
If the fifteenth (15th) day of the month is not a banking day, then payment shall be due on the next succeeding banking day.
Any adjustment due to be made as a result of the procedure set forth in Section or Article VII of the Power Sale Manual shall be added to or subtracted from the invoice due to be paid in the calendar month following the date on which Georgia Power notifies Oglethorpe of such adjustment.
Such payment shall also include any. amounts y
1 theretofore invoiced by Georgia Power and not paid by j
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I
e Oglethorpe_ associated with the administration of.the true up provision as,specified in Article VII of the Power Sale
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~
Manud1.
9.2 Presentation and Payment of Bills for Energy Payments.
As promptly as practicable after.the first of each calendar month during the_ Term, Georgia Power shall send Oglethorpe an invoice stating the estimated y
territorial energy payments determined in accorcance.with Section 8.2, the estimated separate scheduled payments determined in accordance with Section ' 8.3 and the estimeted system station service paymer.ts determined in accordance with Section R.4, all fcr the preceding-calendar' rs.onth, together with any other amounts then due by Oglethorpe to Georgia Power pursuant to the. terr.s of this Agreement.
All such invoices shall be due and payable on or before the tenth (10th) day after Oglethorpe's receipt of such notice.
If the twentieth (20th) day of the month is not a banking day, then payment shall be due on the next succeeding. banking day.
Oglethorpe shall make payment to Georgia Power in accordance with such invoices on or before the date due in immediately available funds through wiring of funds.
With g
each monthly invoice Georgia Power will provide Oglethorpe 1
l a monthly statement to show the energy transactions and the basis for the settlement pertaining thereto, including.,
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the fuel cost components of energy charges.
Any adjustment dua to be made as a result of the procedure set y
forth in Section or Article VII of the Power Sale Manual shall be added to or subtracted from the' invoice due to the paid in the calendar month following the date on which Georgia Power notifies Oglethorpe of such adjustment.
Such payment shall also includ e any amounts theretofore invoiced by Georgia Power and not paid by S
Oglethorpe associated with the administration of the true.
up provision as specified in Article VII of the Power Sale Manual.
9.3 Reimbursement for Inaccurate Charges (Final
,Accountinfi j, _ Oglutherpe shall have until the one hondred 1
-alghtieth (180th) day after the furnishing of a final aceounting by Georgia Power for any charge or credit made to-Oglethorpe pursuant to this Section 9.1 and 9.2 to j
z question or contest the correctness of such charge or
]
l credit, after which time the correctness of such charge or j
i 9
credit shall be conclusively presumed.
In the event that Oglethorpe, by timely notice to Georgia Power, questions or contests the correctness of any such charge or credit, Georgia Power shall promptly review the questioned charge 5
or credit and shall notify Oglethorpe within fifty-five (55) days following receipt by Georgia Power of such j
notice from Oglethorpe that questions or contests such l
- ___-______ _ _w
I charge or credit, of the amount of any error.and the i
amount of reimbursement, if any, that Oglethorpe is f/
~ required to make or-is entitled to receive in respect of such error.
Not_later than the fifth'(5th) banking day after receipt by Oglethorpe of such notice from Georgia.
Power.as to the amount of reimbursement Oglethorpe is.
j required to make, Oglethorpe shall reimburse Georgia Power in immediately available funds.
If Georgia Power is
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required to make any reimbursement to Oglethorpe, Georgia Power shall make such. reimbursement not later than the fifth (5th) banking day after Georgia Power notifies Oglethorpe of the amount of such required reimbursement.
Notwithstanding the foregoing, if-Oglethorpe is then in default in respect of any payments required to be made under this Agreement, Georgia Power may wicht.old such reimbursement.
Georgia Power will provide Oglethorpe with j
such information as is reasonably required by Oglethorpe in order to account for payments made pursuant to this Section 9.3 on Oglethorpe's books.
i 9.4 Availability of Records.
Georgia Power will at all times prior to the end of the one hundred eighty (180) day period set forth in Section 9.3 make available to Oglethorpe, and Oglethorpe may audit, all books and records regarding all charges associated with PS Capacity, PS Energy or PS System Station Service Energy sufficient 1
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to allow.Oglethorpe.to determine that such payments pursuant to Section 9.1 and 9.2 are appropriate.
No payment made pursuant to the provisions of this ARTICLE IX shall constitute a waiver of any right of Oglethorpe to question or contest the correctness'of any charge or.
credit by Georgia Power.
9.5 - Interest on Overdue Amounts.
In addition to any j
V other rights or remedies, legal or equitable, available to Georgia Power, in the event Oglethorpe fails to make any payment when due pursuant to this ARTICLE IX (and the
^
Power Sale Man.ual as appropriate),. interest shall be added to the amount of the overdue payment, from the date such overduo payment was due, at a rate per annum equal to.the lesanr of:
'I (1) the highest interest rate allowed 'oy law; or
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(ii) the higher of [A] a rata five (S)'
percentage points above the average yield on the issue of six-month United States Treasury Bills (auction average), as reported by the Federal Reserve Bank in the Federal Reserve Statistical Release H.
15, at the sale of such Bills by the United States Treasury next preceding the due date of such overdue payment, or (B) a rate five (5) percentage points above the higher of (1) the net interest costs on the most recent issue of thirty (.30) year first mortgage bonds or (2) other j
long-term obligations by Georgia Power. e m
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Such interest shall accrue in simple interest terms per annum in accordance with O.C.G.A. S 7-4-2(a)(1) p
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(Supp.
).
Oglethorpe shall also indemnify and hold Georgia Power harmless from and against any and all losses, costs, damages and expenses arising out of or resulting from Oglethorpe's failure to make such payment when due.
9.6 Failure to Make Payments.
(a) If Oglethorpe fails p
to pay when due the full amounts of all payments required by Sections 9.1 and 9.2, then Oglethorpe shall have no right to any PS Capacity or PS Energy, or to exercise any of.its rights under this Agreement, from the date such overdue payments were due until Oglethorpe has paid the full amounts of all sv.ch overdue payments to Georgia Power together with interest. as provided in Section 9.5.
~ (b)
If Oglethorpc fails to pay when due the full l
amounts of all payments required by Sections 9.1 and 9.2, j
)
then Oglethorpe's rights under this Agreemant to any or all I
of the PS Capacity, the PS Energy or both the PS Capacity and the PS Energy may be sold by Georgia Power, from the date such overdue payments were due until Oglethorpe has 4
l paid the full amounts of all such overdue payments to Georgia Power together with interest as provided in
]
Section 9.5.
Georgia Power shall apply the net proceeds to Georgia Power of any such sale in reduction of the liability of Oglethorpe arising from its non-payment (including interest as provided in Section 9.5). ----^-a-_G_m A_._._Am
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m g 1-(c). In addition to the rights-granted'in.Section 9.5 and this Section 9.6, Georgia Power may take_any action, in y
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law or'in equity, to enforce-this Agreement and'to recover
~
for-any loss or damage, including without limitation reasonable attorney's fees and collection costs,: incurred 3
by reason of any default in payment by Oglethorpe under this Agreement.
-I (d)'
Notwithstanding the foregoing provisions of this
-Section 9.6, if-Oglethorpe disagrees with or disputes the amount of any payment claimed by Georgia Power ~to be due pursuanteto this Agreement, Oglethorpe shall make'such payment under-protest-and thereafter shall be reimbursed by Georgia Power for any: amount in error after the-settlement of.such disagreement or dispute, in accordance with Section 9.3 C'"
ARTICLE X REPRESENTATIONS, WARRANTIES AND LEGAL OPINIONS 10.1 Oglethorpe Representations and Warranties.
Oglethorpe hereby represents, warrants and covenants to Georgia Power as follows:
(i)
Oglethorpe is an electric membership j
corporation duly organized, validly existing and in good standing under the laws of the State of Georgia
~
and has-corporate power and authority to execute and.
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bk' deliver this Agreement and to perform its obligations hereunder, and to carryfon its business as it is.now g
I being conducted and as it is contemplated hereunder to be conducted in the future; (ii)
The execution, delivery and performance r
E of this Agreement lar Oglethorpe have been duly and effectively authorized by all requisite corporate action; and N
(iii)
Set forth in Exhibit."D" attached hereto P
and. incorporated herein by this reference is a true-and complete list of all of the member electric membership corporations of Oglethorpe.
Oglethorpe is the sole and exclusive power supplier for each such member electric membership corporation's Georgia y
operations (except for allotments of power to which
_ each such member electric membership corporation is entitled from Federally-owned projects),. and will 3-remain such sole and exclusive power supplier, to the extent that Oglethorpe has capacity-available, under Wholesale Power Contracts with each of such member j
t l
electric membership corporations, which Nholesale l
Power Contracts, by their terms, will re;:.e.in in effect l
1 from the date hereof oc least until December 31, 2006, and Oglethorpe shall not from the date hereof until
)
i December 31, 2006 terminate any such Wholesale Power Contract or other power supply arrangements with any
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_ = _ - _ _ _ _ _
-_____ = __ -
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such member electric membership corporation.'without
.the prior ~ written consent of Georgia Power.
X x
10.2~ Georgia Power Representations and Warranties.
Georgia Power hereby represents,' warrants and covenants to 4
Oglethorpe as-follows:
~ (i). Georgia Power is a corporation duly organized, validly existing and in good standing under the laws of the State of Georgia and'has. corporate power and= authority to' execute-and deliver this-
' Agreement and to perform-its obligations hereunder,
~
-and to carry on its business as it is now being.
conducted and as it is contemplated hereunder to be conducted in the future; and (ii)
Tim execution, delivery and performance
. of this Agreement by Georgia Power have beef dd y and' effectively authorized by all requisite corporate b
action.
10.3 Delivery of Legal Opinion to Georgia Power.
Contemporaneous 1y with the execution of.this Agreement, Oglethorpe shall cause Messrs. Paul, Hastings, Janofsky &
Walker, counsel for Oglethorpe, and Charles T. Autry, General Counsel for Oglethorpe, each to furnish Georgia Power an. opinion dated the date of execution of this Agreement to the effect that:
u,.
_ _ - = _ - _ _ - - - _ _ -. - _
O (1)
Oglethorpe is an electric membership g-corporation duly organized, validly existing and in good standing under the laws of the State of Georgia
-and has the requisite power and authority to execute f
'and deliver this Agreement and to-perform its obligations hereunder, and to carry on its business as it.is then being conducted; p-(ii)
The execution, delivery and performance of this Agreement by Oglethorpe have been duly and effectively authorized by all requisite corporate and membership action; (iii)
Oglethorpe had full power and authority to execute this Agreement, and this Agreement has been gf duly executed and delivered by Oglethorpe and is the legal, valid and binding obligation of Oglethorpe enforceable & gainst it in accordance with this
' Agreement's terms (except as the provisions hereof may 33 be J imited by' bankruptcy, insolvency, reorganization or other laws relating to or affecting the enforcement of creditors' rights and by other laws of general application affecting the rights and remedies.of creditors, and except that the availability of the remedy of specific enforcement or of injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought); l
-(iv)
Each member electric membership p-corporation required pursuant to Section 2.3 to sign the initrument described'in Section 2.3(b)(i)'.had full
. power and authority td execute such instrument, and
[
each of such instruments have been duly executed and~
delivered by the member electric' membership corporation named in such instrument and each of such instruments is the legal, valid and binding obligation s
of the member electric membership corporation named in such instrument enforceable against such member electric membership corporation in accordance with the instrument's terms (except as the provisions of such instrument may be limited by bankruptcy, insolvency, reorganization er other laws relating to and affecting the enforcement of creditors' rights and by other laws of general application affecting the rights and remedies of credit. ors, except.that the availability of the remedy cf specific enforcer:ent or of injunctive i
relief is sub"ect to the discret?.on of the court j
before which any proceeding therefore may be brought);
and j
(v)
Each of the member electric membership corporations which executed an instrument as described j
in Section 2.3(b)(1) is the same entity of the same name which was a party to the AEC Settlement or, as may be described in any one or more of such
n h"
instruments, is the party which succeeded to all of the rights and benefits of one of the parties to the
)
AEC Settlement as named in such instrument.
10.4. Delivery of Legal Opinion to Oglethorpe.
)~
Contemporaneously with the execution of this Agreement, Georgia Power shall cause Messrs. Troutman, Sanders, Lockerman & Ashmore, counsel for Georgia Power, to furnish' 5
Oglethorpe an opinion dated the date of execution of this Agreement, to the effect that:
(i)
Georgia Power is a corporation duly organized, validly existing and in good standing under the. laws of the State of Georgia and has corporate power and authority to execute and deliver this C
Agreemsnt and to perform its obligations hereunder, and to carry on its busir.ess as it is then being conducted; l
- )
'l (ii)
The anscutien, delivery and perforn.ance of this Agreement by Geoegia Power have been-duly and.
j effectively authorized by all requisite corporate action; and (iii)
Georgia Power had full power and authority to execute this Agreement, and this Agreement has been duly executed and delivered by Georgia Power and is the legal, valid and binding obligation of Georgia Power enforceable against it in
accordance with-this Agreement's: terms (except 'as the provisions hereof may be limited by bankruptcy, E
. insolvency, reorganization or other laws relating to or affecting'the enforcement of creditors' rights and by'other laws of general application affecting the i
rights and~ remedies of creditors, and'except that the
' availability of the remedy of specific enforcement or of injunctive relief is subject to the discretion of a
the court before which~any proceeding' therefor may be brought).
m ARTICLE XI l
CERTAIN ADDITIONAL AGREEMENTS 11.1 No Rociuirement of Service and Non-Liability.
(al Oglethorpe agrees that Gecrgia Pcwer is not required j
to. wake available under this Agreement Unit P3 Capacity from any~ or al1 Units at all times during the Ter:m or to deliver under '.thip Agreement a constant supply of Unit PS n.
~
Energy from any or all of the Units and that Georgia Power L
L shall never be considered in default hereunder for failing to make available Unit PS Capacity, Unit. Territorial PS Energy of Unit Separate PS Energy from any or all of the Units.
The provisions of Section 11.2 state the sole L
reason for which Oglethorpe may fail to make any payments for charges owed pursuant to ARTICLES VIII and IX of this i
! I S
i
- - - ~ - -
__m._
m._
P
~'
Agreement and Articles VII and
-of the Power Sale Manual..
j :-
L(b)
WIthout limiting the generality of Section 11.5,-
and except only as.provided for.in'Section 11.2,LGeorgia i
Power shall'not be responsible in tort or contract to'
~
Oglethorpe for' damages of any' description whatsoever which may result from~any interruption or' failure of' service'or h
deficiency in the quality of service.
11.2 Suspension of Payments.
(a)
If.and to the f
extent the" Net Dependable' Capacity of any. Unit is zero-(-0-) for any calendar. year during the Term as the result of the gross negligence or willful misconduct of. Georgia
. Power in the management, control, operation or maintenance
- of such Unit, Oglethorpe may, as its sole-remedy, suspend payinents for Unit 58 Capacity and Unit PS Energy from such Unit from the conanenccwnt of such calendar year.until a
service from such Unit is rectored, provided that:
(1)
Oglethorpe has providee. Georgia Power.
i with prior written notice of its intent to suspend payments; and (ii) if Georgia Power disputes such notice, j
unless Georgia Power and Oglethorpe resolve'such dispute, a court of competent jurisdiction has determined that Oglethorpe is entitled pursuant to
)
1 this Section 11.2(a) to suspend payments related to l
l such Unit that are due under this Agreement..
5
Georgia Power shall determine whether and when to restore service from such Unit in accordance with Section 11.3.
y Any payments made by Oglethorpe which are ultima'tely determined to have been subject to a right of suspension under this Section 11.2(a) shall be repaid to Oglethorpe by Georgia Power with interest from the date payment was received by Georgia Power at the rate specified in Section 9.5.
3
,(b)
If Ogletherpe acquires or has acquired the right pursuant to Section 11.2(a) to suspend payments hereunder as to any Unit, then notwithstanding the provision of said
,s Section 11.2(a) Oglethorpe may not suspend payments as to such Unit if Georgia Power has made available to Oglethorpe, prior to the date on which Oglethorpe may actually suspend sach payments, that r4 umber of kilowatts of capacity (ent. essocisted energy) as would have been l
~
available if the Net Dependable Capacity of such Unit for
)
such calendar year had equaled the !!ameplate capacity of such Unit.
If Georgia Power makes such alternative 1
l capecity and associated energy available to Oghathorpe at any time after Oglethorpo has suspended paymento purscant to said Section 11.2(a), then Oglethorpe must cease any such suspension of payments as of the date on which Georgia Power makes such alternative capacity and i
i associated energy available to Oglethorpe.
If in either case Georgia Power makes an amount of alternative capacity
) 1 9
.___-_______________0
1 a.
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4
'(and2 associated! energy)Lavailable-to Oglethorpe:that is
~
1 less than the capacityz(and associated energy).that would have:been available'if the NetEDependable Capacity of'such 1
Unit for such_ calendar. year-had. equaled.the Nameplate H
L CapacityLofisuch Unit, then Oglethorpe's right to suspend j
paymentsTshall apply only to that portion of such payments.
as are associated-with the number.of kilowatts of' capacity 1
(and associated energy) which'are not replaced by the 1
-alternative capacity and associated. energy that Georgia Power makes available to Oglethorpe pursuant to this Section 11.2 (b.). : ~ Georgia Power may exercise or not y
exercise-its rights under this Section 11.2(b) in its: sole discretion'.
If Georgia Power. exercises its rights under this Section 11.2(b), it may cease to exercise such rights-at any later date, in its sole discretion.
11.3 Managing, Rebuilding, Repairing and Repowering 5, ;
the Units.
(a) Georgia Power shall have the sole authority to manage, control, operate and maintain each of the Units and may.so manage, control, operate and maintain' each of the Units.in its sole discretion consistent with Prudent Utility Prictices.
(b)
If Georgia Power determines in its sole discretion that the estimated costs of rebuilding, repairing, refurbishing, operating or maintaining such Unit exceed the anticipated benefits to Georgia Power of O
H
- rebuilding, repairing, refurbishing, operating er maintaining such Unit, then Georgia Power may so retire or allow the reduction of the capacity available from such' Unit in its' sole discretion.
If Georgia Power so retires a Unit, then such Unit shall be deemed for purposes of s
this Agreement no longer to be a Unit at all'on and after the date it.is retired'by Georgia Power, and for that 6
portion of the Term on and after such'date, Ogletnorpe i-shall have no entitlement under this Agreement to any capacity or associated energy.from such Unit.
Georgia y.
Power will'have no obligation to make alternative capacity and associated energy available to Oglethorpe.to replace g
t e capac ty and associated energy that Oglethorpe had h
i expected to purchase pursuant to this Agreement from any-Unit that is so retired or whose available capacity has been reduced.
hf (c)
If Georgia Power determines in its sole discretion that it is necessary or appropriate to retire or reduce ~the capacity available from a Unit in light of or due to any action by a Governmental Authority, including without limitation the enactment of any legislation concerning environmental matters or the promulgation of any rules or regulations by a Governmental Authority concerning such matters, then Georgia Power may l:
so retire or reduce the capacity available from such Unit L
in its sole discretion.
If Georgia Power so retires a
> i
_t
.___________________.___.i___A_i_.
f.
Unit,'then such Unit shall be deemed for-purposes of this l
Agreement no longer to be a Unit at all on and after the M
- 6 date it:is_ retired by Georgia Power, and for that portion
^
of che Term on and after such date, Oglethorpe shall have no entitlement under this Agreement to any capacityfor
~,
associated energy from such Unit.
Georgia Power will have no obligation to make. alternative. capacity and associated energy available to Oglethorpe to replace the-capacity and y
associated energy that.Oglethorpe had expected to purchase pursuant to this Agreement from any Unit that is so retired or whose available capacity has been reduced.
(d)
If Georgia Power determines in its sole discretion that the-anticipated benefits to Georgia Power of repowering or changing the fuel of any Unit exceed the estimated costs of such repowering or fuel change, then Geqrgia Power may so repower.or change the fuel of such Unit in its sole discretion.
C' (e)
Without limiting the generality of ARTICLES VII, c
VIII or IX or of Section 13.3, or of the Power Sale Manual, Oglethorpe agrees that it shall be responsible for any-and all costs incurred by Georgia Power under this Section 11.3 in connection with any Unit, in proportion to the Unit PS Ratio of such Unit, and in accordance with the terms and conditions of this Agreement.
11.4 Attribution of Responsibility for the Units.
Oglethorpe agrees that it will be deemed to have been !
I
responsible ~for any and all emissions from.each of the i
Units into the air or water,.and for any and all' noise and other types of pollution and nuisances, in proportion to
.the Unit ?S Ratio of such Unit at such time.
Oglethorpe further agrees that it shall be deemed to have contributed F
to all effects of and circumstances resulting from the operation of each of the Units, also in proportion to the Unit'PS Ratio of such Unit at such time.
7p 11.5 Limitation of Liability.
Georgia. Power and Oglethorpe agree, and acknowledge that it is each of their respective intents, that the obligations and remedies set forth in this Agreement are exclusive and in lieu of all other obligations or remedies.
No expansion of any such obligation or remedy shall be provided in any suit, action
~
or proceeding of any nature whatsoever, whether the claim underlying such suit, action or proceeding is based on contract, tort (including without 1Laitation strict liability) or otherwise.
Furthermore, notwithstanding any other provisions of this Agreement, neither Georgia Power nor any Affiliate of Georgia Power assisting Georgia Power in the performance of its duties under this Agreement shall have any liability whatsoever for the performance, nonperformance or delay in performance of any of its duties or obligations under this Agreement.
l e--
11.6-MDC Settlement and Oglethorpe's self-suf ficiency.
I
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j (a)
Oglethorpe agrees.that the undertakings made in th'is-l Agreement by Georgia Power completely fulfill any and all l
obligations:that Georgia' Power may now or hereafter have under the AEC Settlement (including without limitation
'l under paragraph 4(b) of Attachment B thereto), or under i
Attachment B to the AEC Settlement as incorporated i
in
, to provide full requirements power, Y
partial requirements power, or both full requirements I
power and partial requirements. power, to any or all of Oglethorpe and its member electric membership corporations.
l D
Oglethorpe hereby releases Georgia Power from any and all l
liability in connection with, and waives any and all rights that it may have to enforce, the referenced obligations under or connected with the AEC Settlement, with both such release and such waiver being effective on and after the effective date of this Agreement.
[ Note:.
The. blank will be filled in with the identifica-tion of the Vogtle and Hatch licenses.)
I (b)
Oglethorpe hereby undertakes to construct, purchase or both construct and purchase sufficient capacity to meet the loads of Oglethorpe and its member electric membership corporations, including without z.,
limitation a reasonable level of reserves, from and after the effective date of this Agreement.
Oglethorpe agrees _ _ _ - - _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ - _ -. _ _. - _ _ - _ _ _
that in no event shall' Georgia Power be-required to. sell' 1
y any capacity, energy or capacity and energy to.Oglethorpe from and alter the effective date of this Agreement other than.the. capacity and. associated energy that Georgia Power has contracted-to sell to Oglethorpe during the Term under and as set forth in this Agreement.
11.7 Equity Return on Buy-Back Capacity.
Oglethorpe agrees that the equity return rate for payments by Oglethorpe to Georgia Power for buy-back capacity both under Section of that certain Plant Robert W.
Scherer
. Units Numbers One and Two Operating Agreement dated as of.
May 15, 1980, and under Section of that certain
, dated as of shall be Thirteen and Seventy-Five one-hundredths percent (13'.75%) from and after the date of this Agreement.
To the extent of the preceding sentence, this Agreement shall be deemed to have amended, and shall constitute an amendment of, each of the contracts referenced in the preceding sentence.
[ Note:
We will add an identification of the Scherer and Vogtle buy-back provisions.]
11.8 Character of Sale and No Third Party Benefit.
l (a) The sale of capacity and associated energy pursuant to 1.
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)
k L
I this Agreement;shall not constitute a sale, lease,
(..
transfer or conveyance of an ownership interest in or to t:
L
.any or all'of.the Units, nor a dedication of ownership of any or all of thw Units, to Oglethorpe or'any.other person or entity.
Unit PS Energy made available from any Unit by.
Georgia Power in accordance with ARTICLE IV shall, however, l
be devoted to Oglethorpe and the delivery of such Unit PS 1
4 Energy to Oglethorpe shall not be subject to preemption by e
Georgia Power.
(b)
Nothing in this Agreement shall be construed to create any duty, obligation or liability of Georgia Power to any person or entity not a party to thi, Agreement.
11.9 Acknowledgment of Unit Power Sale Contracts.
Georgia Power and Oglethope acknowledge that Georgia Power has' entered into certain contracts prior to the date hereof that obligate Georgia Power to sell to.other parties entitlement to certain capacity.and as.sociated
' energy from certain electric generating facilities for specified periods of time.
Those contracts are as follows:
(Note:
We will add a list of all UPS agreements.)
Georgia Power and Oglethorpe agree that this Agreement is entered into subject to the rights, powers, options, 4.
i bi s
1 obligations and duties of Georgia Power, Oglethorpe and other persons and entities set forth in the contracts L
l identified,in=(i) through (
) of this Section 11.9 and
-any and all extensions thereof or successor contracts thereto.
If and to the extent there is a conflict between a provision of any of the contracts identified in (i) through (
) of this Section 11.9 and a provision'of-this Agreement, then the relevant provision of the L'
contract identified in (i) through (
) of this Section 11.9 shall control over the conflicting provision of this Agreement.
11.10 Approvals.
Oglethorpe and Georgia Power agree to use their best efforts to apply for promptly and to pursue diligently any required approvals from Governmental Authorities for the consummation of the transactions contemplated hereby or for the giving of effect to the expiration of this Agreement or any termination of this Agreement on the date determined in accordance with ARTICLE II (which obligation of Oglethorpe shall be in addition to its undertakings under Section 2.4).
This provision is not intended to subject this Agreement to the jurisdiction of any Governmental Authority that does not have such jurisdiction over this Agreement at the time of i
execution of this Agreement.
~61-1
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ARTICLE XII
{
ALIENATION AND ASSIGNMENT 12.1. No Assignment.- Oglethorpe may not-sell,. assign or otherwise transfer any or all of this Agreement'or y
Oglethorpe's rights'or obligations under this Agreement,
.at any' time, without the prior written. consent of Georgia Power in each instance; provided, however, that Oglethorpe i'
shall have the right to convoy a-security interest in this Agreement as. security for bonds or other. obligations issued.or to be issued and that Oglethorpe shall have the iu
. rights set forth'in Section 12.2.
12.2 Resale. ' Subject to the provisions of Section 1
L 12.1, Oglethorpe shall have the right to resell from each 1
Unit its entitlement under this Agreement to either or
.both the capaci2y of or energy from such Unit, or any part
-m thereof, to any person or entity, subject.to the terms and conditions of this Agreement.
Oglethorpe agrees to indemnify and hold Georgia Power harmless from and against i
any and all costs, expenses, liabilities and damages of l
j L
any kind occasioned in any way by the operation of any or 4
all of the Units pursuant to, as a result of or in
~
connection with any such resale of capacity, energy or both or at the request or direction of any party to any
.such resale transaction, including without limitation any b~
and all costs, expenses, liabilities and damages that i
1.
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result'from a deviation from the continuous. economic dispatch _in'accordance~with Georgia Power's standard scheduling and dispatch procedures'to serve, in-part, the electric l capacity and energy load within the~ Georgia Territory absent such operation of any or all'of the Units.-
L 12.3 Successors and Assions.. Subject to the
[.
provisions of Sections 12.1 and 12.2, this Agreement shall inure-to the' benefit of and be binding upon~any respective successors'or assigns of Oglethorpe and Georgia Power.
ARTICLE XIII MISCELLANEOUS PROVISIONS
- !13.1 Interrelationship with the Georgia Coordinated
'Res'ources' Agreement.
Georgia Power and Oglethorpe recognize that theLGeorgia Coordinated Resources Agreement-governs the coordinated operations of Georgia Power and Oglethorpe necessary for conduct of the transactions contemplated in this Agreement.
To the extent not
' inconsistent herewith, the applicable provisions of the Georgia. Coordinated Resources Agreement, including any amendments thereto, shall govern the operations of Georgia Power and Oglethorpe under this Agreement.
In the event such Georgia Coordinated Resources Agreement is terminated l
or cancelled'during the Term, the provisions of such i
l.
\\;
['
[
Georgia Coordinated Resources Agreement which are-Lessential for the continuation of. transactions under this Agreement shall survive the. termination or cancellation of such Georgia Coordinated Resources Agreement.
1 L..
l 13.2 Provisions of the Georgia Coordinated Resources l
l.
- Agreement Specifically Incorporated by Reference.
Georgia Power and Oglethorpe agree that the following provisions-y of the Georgia Coordinated Resources Agreement are specifically incorporated herein by reference as though fully set forth herein:
1 E
[ Note:
We will incorporate the appropriate references when the GCRA is drafted.]
13.3 General Cost Principles.
Charges for capacity A
and associated energy to be sold by Georgia Power and purchased by Oglethorpe pursuant to this Agreement consist i
of and include both direct and indirect costs incurred by Georgia Power attributable to activities required for the I
construction, management, control, operation and
]
maintenance of the Units.
Oglethorpe and Georgia Power have agreed upon certain formulary descriptions of j
1 I
methodology and procedure as contained in the Power Sale Manual and this Agreement which shall be used in
)
km lw computation of such charges hereunder.
Oglethorpe acknowledges that the derivation and computat' ion of such
):
!E charges hereunder will include costs both directly and indirectly incurred by Georgia Power and that in the-case-of costs indirectly incurred it will be necessary to apply h
certain allocation methods.and procedures to assign such costs to the appropriate facilities.
Such costs shall be i
1 allocated by using the allocation methods and' procedures set forth in the Power Sale Manual.
If no allocation methods or procedures have been specified herein for a particular cost or cost component, Georgia Power shall, and Oglethorpe agrees that Georgia Power shall have the authority to, apply fair and equitable allocation methods and procedures consistent with Prudent Utility Practices.
It is the intent of Georgia Power and Oglethorpe that the l
accounting for Georgia Power costs, both direct and
{
1 indirect, and allocations thereof shall be pursuant to D'
i assessing actual costs incurred on a fully allocated 1
L basis, and charges to Oglethorpe shall not include duplication or allocations of greater than one hundred percent (100%) of such costs.
13.4 Governing Law.
The validity, interpretation and n
performance of this Agreement and each of its provisions shall be governed by the laws of the State of Georgia.
<=
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13.5 No Delay and No' Waiver.
-(a) Except only as set forth:in'Section 11.2,-no disagreement or dispute of any I
kind between Oglethorpe,and Georgia Power concerning_anyl
]
f
. matter, including without limitation the amount of any payment:due from Oglethorpe or the-correctness of any_
i f
Scharge made by' Georgia Power to Oglethorpe, shall permit.
Oglethorpe'to delay _or withhold any payment pursuant to i
t
.this' Agreement.
_ ( b)_ NeitherTGeorgia Power's nor.Oglethorpe's' failure to enforce any provision or provisions of this Agreement shall-in any way.be construed as a waiver of any such-A provision or provisions as to-any' future' violation thereof, nor prevent it_from enforcing each and every other provision of this Agreement at-suchLtime or at any-time thereafter.
The waiver by either Georgia Power or l
. Oglethorpe of any~right or remedy shall not constitute a waiver of its'right to assert said right or remedy,-at any j
b-timeLthereafter, or any other. rights or remedies available to it at the time of or any time'after such waiver.
'l 13.6-Notice.
Any notice, request, consent or other-communication permitted or required by this Agreement shall be in writing and shall be deemed given when D-deposited in the United States Mail, first class postage-prepaid,-and if given to Georgia Power shall be addressed to:
~
-66L.
i
.I
- - - _ _ _ _ _ _ - - - _ _ = _ _ _ _ - _ - - _
f L
y Georgia Power Company-333 Piedmont Avenue, N.E.-
Atlanta, Georgia 30308 i
).
Attentions. Vice President-Bulk Power Markets i
and if.given to Og.\\ethorpe shall be addressed to:-
Oglethorpe Poeor Corporation 2100 East Exchange Place P.O. Box 1349 Tucker, Georgia 30085-1349 Attention:
Chief Executive Officer k
unless Georgia Power or Oglethorpe shall have designated a different officer or address for itself by notice'to the other in writing.
p 13.7 Article and Section Headings.
The descriptive headings of the various Articles and Sections of this Agreement have been inserted for convenience of reference only and shall in no way modify or restrict any of the terms or provisions. hereof.
bf 13.8 No Partnership.. Notwithstanding any provisions of this Agreement, Oglethorpe and Georgia Power do not intend to create hereby any joint venture, partnership, association taxable as a corporation, or other entity for the conduct of any business for profit.
J 13.9 Time of the Essence.
Time is of the essence of this Agreement. '
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13.10 Amendments.
This Agreement may be amended by and only by a written instrument duly executed by each of
~
, Oglethorpe and Georgia Power.
p 13.11 Counterparts.
This Agreement may be executed simultaneously in two or more counterparts, each~of which shall be deemed an original but all of'which together W.
shall. constitute'one and the sar.s instrument.
13.12 Further Assurances.
From tima.to time after the execution'of this-Agreement, Oglethorpe and Georgia Power will execute and deliver such documents, upon the request of either, as may be necessary or appropriate to carry out the intent of this Agreement.
13.13 Including.
Wherever the term " including", is used in this Agreement, such term shall not be construed as' limiting the generality of any statement, clause, phrase or term.
l 4
I I
I,
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. n
IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement under seal in Atlanta, 7
Georgia, a~s of the date first above written.
" Georgia Power" Signed, sealed and delivered GEORGIA POWER COMPANY in the presence of:
1 By:
Notary Public Vice President-Bulk Power Markets Notary Commission Expiration Date:
(NOTARY SEAL)
Attest:
(CORPORATE SEAL)
"Oglethorpe" OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP GENERATION &
Signed, sealed and delivered TRANSMISS10N CORPORATION) in the presence of:
By:
I Chief Executive Officer
)
Notary Public l
l Notary Commission Attest:
I Expiration Date:
i l
(NOTARY SEAL)
(CORPORATE SEAL) l l
1 i
l _
_ _ _ - _ _ _ = _ _. _ - _ _ _ _ _ _.
i Oglethorpe Power expects Georgia Power Company (~CPC-) and the-Southern Company (* Southern-) to confirm the following principles regarding use of the Georgia Integrated Transmission System
( ITS-):
1.
That Oglethorpe Power has the present right, in its discretion, to use the ITS, including interconnection points with other systems such as the Georgia-Florida interface, without regard to whether Oglethorpe Power is generational self-sufficient.-
This right is on preciseiy the same basis as GPC's right to use the ITS for any transmission requirements, including the transmission of power obtained from off-system purchases' 8
and for off-system sales.
9 -j i
2.
That GPC and Southern will use their best efforts to accomplish the rapid and success ful conclusion, of
- negotiations regarding the-terms of the generic Interchange Scheduling Agreement, and any appropriate amendments to existing agreements.
The successful l
conclusion of these negotiations will result in a binding agreement containing scheduling. operating and accounting procedures to ensure Oglethorpe Power's j
access to the'ITS-for wheeling and for transmitting power for other off-system transactions on a fair and
{
competitively equal basis.
f 3.
That Oglethorpe Power is entitled to use all interconnection points between the ITS and other systems
/-
'in a manner consistent with and equivalent to its use f
the ITS within Georgia, and is entitled to use approximately 640 megawatts of transmission capacity a the Georgia-florida interface for off-system transactions.
9 s