ML18191A345

Columbia Generating Station - Washington Public Power Supply System Nuclear Project No. 2, $125,000,000 Revenue Bonds, Series 1975 a

ML18191A345
Person / Time
Site:	Columbia
Issue date:	03/06/1975
From:	Washington Public Power Supply System
To:	Office of Nuclear Reactor Regulation
References
Download: ML18191A345 (40)

Text

Washingtou Public Power Supply System Nuclear Project No.2 u,.Revenue Dottds, Series l975 A Dated: March 1, X975 Duc: July 1, as shown below Principal and semi.annual interest (July I and January I, commencing July I, 1975)payablc at Seattle-First National Dank, Seattle, (Vashington, Continental Illinois National Bank and Trust Company of Chicago, Chicago, Illinois, and Thc Bank of New York, New York, Ncw York.Coupon bonds in the denomination of$5,000 registrable as to principal only and fully registered bonds in the denomination of$5,000 or any multiple thereof and interchangeable.

Continental Illinois National Bank and Trust Company of Chicago is Bond Fund and Construction Fund Trustee.The 1975 A Bonds maturing on July I, 1999 and on July I, 2012 arc subject to rcdcmption by operation of thc Bond Retirement Account at 100%plus accrued interest to satisfy sinking fund installments, on January I, 1995 and on January I, 2000, rcspcctivcly, and on any interest payment date thereafter.

'Inc 1975 A Bonds may bc redeems>ed prior to maturity, at the opdon of the Supply System, on or after July I, 1985, as a whole at any time, or in part in inverse order of maturitics and by lot within a maturity, on any interest payment date at prices ranging from 103%for thc period July It 1985, to and including Junc 30, 1990, to 100%after June 30, 2000, plus accrued interest to thc date fixed for redemption in each case, as further dcscribcd herein.The 1975 A Bonds may also be redccmcd under special circumstances as further described herein.Interest exempt, in the opinion of Bond Counsel, from federal ineonie taxation under existing laws and regulations and specific rulings received from the Internal Revenue'Service with respect to the Bonds.The 1975 A Bonds are being issued to finance a portion of the cost of acquisition and construction of the Wasjihgton Public Power Supply System Nuclear Project No.2.Thc Project's entire capability has been sold by the Supply System to certain statutory preference customers of the Bonneville Power Adminis-tration and assigned by such preference customers to Bonneville under Net Billing Agrcctnents herein described.

The 1975 A Bonds and the interest thereon arc payable solely from the Bond Fund created by the Resolution and the moneys pledged to such fund are limited to the income, revenues, rcccipts and profits derived by thc Supply System through the ownership and operation by it of the project, including all payments to be made to the Supply System pursuant to the Net Billing Agreements, and Bond proceeds.The Net Billing Agreemcnts provide that each such prcfcrence customer is obligated to pay the Supply System its share of Project annual costs, and Bonneville is obligated to credit thc amounts so paid against amounts owed to Bonneville by such preference customers for the power and services it provides, whether or not the Project is completed, operable, or operating and notwithstanding the suspension, interruption, interference, reduction or curtailment of the I'roject output.The Bonne-ville Power Administration will usc its revenues to pay any costs billed to such preference customers which arc not offset under the Net Billing Agreements.

Sce"Security for the Bonds" and"Bonneville Povvcr Administration" herein.AMOUNTS, MATURITIES, COUPONS AND YIELDS Atooun!Doo Coupon Vlo(8 Amount Duo Coupon 08,000,000 1988 6,60%5;10%81,600,000 1989 6,60%3,200,000 1983 6.60 5.20 1,G00,000 1990 6,60 3,500,000 1984 G.G0 5.30 1,800,000 1991 6.60 3,900,000 1985 6.60 5.45 2,000,000 1992 6.60 4,300,000 198 G G.60 5.60 2,000,000 1993 6.60 1,500,000 1987 6.60 5.70 2,300,000 1994 6.60 1,500,000 1988 6.60 5,80 9159000,000 6.60%Term Bonds Due July X9 1999 Price 100%$78>000,000 67/k%Term Bonds Due July 1, 2012 Price X00%(Plus Accrued Interest)Vtol8 8.90%6.oo 6,10 G.20 6.25 6.30 f Moodyps: Aaa NEÃEBSUR g2I+000 (000 Dotmun I 80mom6APoopnAAA WASHINGTON PUBLIc POwHR SUPPLY SYsTUt,15@lateg Docile" FLi<A Mtmicipal Corporation and a Joint Operating Agency of thc State of Wash'uigton Tbe 1975 A Bonds arc offered when, as and if issued nnd rcceivcd by us and arc subject to thc approval of legality by V8'ood Dawson Love S;Sabatinc, Ncw York, New York, Bond Counsel to thc Supply System, and Houghton Cluck Coughlin ik Riley, Scattlc, washington, Special Counsel to thc Supply System.It is cxpcctcd that thc Bonds in dclinitivc form will bc ready for delivery on or about March 27, 1975.Jofarch 6, 1975 Bosan oy Dtazcross A.J.Bene>Lttir Rolf L>Jcmtegssrd Kirby Bi1tings!Cy Hero!d W.Jeebies Lne Bray Thomas F.hroupa Gerald C.Fcnton Francis Loago Ed Pitcher'ucatin hfircr Alvin E.Fletcher Howard Prey Joha Goldsbuty Edwia IV.Ta)for D.E.Hughes'oha L Toe<<a W.G.Hefbcrt, Jr.~Gordoa Vickerye Atnohf J.James Glctm C.Wsihfcyv Joha J.Wcfdt~Ezccutivc Gxnait tee hf ember.OPP>czas Alvin E.Fletcher Prcshfent Howard Prey Vice Prcddcnt Edwht W.Taylor Secretary AEMnttsTEATtvz STAPP Managing Director Deputy hfsnsyng Director hfensgcr, Planning aud Anslluis hfsnager, Construction DiviYion hfsnsgcr, Proj~m Division hfansgcr, Techaical DiriYioa hfaasgcr, Amtftittaation DidYton M~gcr, Operadons D:->tYimt Mmtagcr, Finance DiviYioa Treasurer Auditor Chief Counsd J.J.Stein L L Humphreys H R Koimsta IL D.Ssblbcig C.Lr Love Dusne L Rcnberger V.V.Jofmsoa R.E.Smith James T.Bobo James D.Pcrho C W.Godfrey Richard Q.Quigfcy SPzctAL C0UNsEL Houghton Cludc Coughlin dt Riley Boi>COUNSEL Wood Dawson Love gs Ssbstiae WASIIINGTON PUBLIC POWER SUPPLY SYSXKhf Prfndpal Ofhce-Fdcbfsnd, Washh>~<on TABLE OF CO>>VRdS SUstMAET SrATzsrzNT

~~~~~5 Tttz SUPPLY SYSTEM,~~~~~~~~~~~~~~~~~~~g The Supply Slsmm's Generating Pro ccts................

Szcuturv Poa Tttz Bows 10 11~~~~~~ll 12 12 12 13 14 14 Tttz Pr orzcT Locsdon of the Project Dcscripdion ol the Project.initial Fuel Core Construction Contrast and Scbmfdo Project Financing Reqdrcm~>Liccusm and Permits Project Output.Project Annual Costs BoivzvtLLE Powza AnwtNtsTEATtoN Addidoaal Power Supply.Bonncdilc Contracts~Iitz Hvnao TNzastAL Powza PaocaAM Am Powzz SUPPLE tN Tttz PActrtc Noart twzsT Power Retiuiremcns md Rcsourccs'Qm PAartctrasm

.15 17 17 18 2P Ihe fnformsden contained la this Odidd Statement fms beea obts>>ed from thc Scpply System aad other sources deemed reliable.No reprcsentadoa or rrarrsaty ls made>however>as to thc accuracy or compte'tenets ol such information, aad nothing comahied hach fr, or shJ'e>rdicd upon as~promise or rcprcsentstioa of the U>nderwrften.

'1hls OKdsf Smtcment,<<hkh fndades the cover~~aad exhibits, docs oot coaititute aa oga to sdl the 1975 A Bonds la any state to aay pasoa to<<born it is tmhrrhl to mshe such oiler la such state.No desLr, calcem or other pecten hm baa authorized to gfre sny faformsdon or to~aay representations other~those con>>d la this Otgdsf Smtc meat fa connecdoa<<fth the otfcrfag ol thc 1975 h Bonds>sad if glrcn or tnsdc>such feformstfon or rrprmasadoa nu>st not bc rdfmf upon.CawsULTU'o ENcntzza~R.W.Bxk and Assoc<<tcs CoNsraucnoN ENcntzza Burns and Roc, fnc.FntANCSAL CoNsULTANT Blyth Eastman Dghm th Ctx Incorporated Iltz NET BtLLEto Acazzstzhm

......................."" Term Ownership and Operation.SSL, Par&etc amf Asti~Termfnshon

.'~~~~~~~~~~~~21 21 21 21 22 22~23

Evest ot Default Participant's Rate Covenant and Somces of Payments............

hfodigcarion of Agreement.Eztub)ts T)IE PRMEGT AGREEIIENT Term Design, Liccss)sg asd Cosstzuctios of thc Project................

Fisasring Budgets Operauoa aad Mrisumancc

.Bonds for Replacements, Repairs am)Capital Addirions..........

Bonneville's Approval and Project Comuimst..................

Ezhib)ts ExlaatT Eattatv Exmatv ExtaaIT EENNIT ExmaIT I-Thc Pazriripasts II-Lcuer of R.W.Beck asd Amoeba...............

IH-Letter of Bu~am)Roe, Inc......................

IV-Op&as of Coume)V-Bonn viih Power Adms)suarion Projmtuf Rcvcn cs..Vl-Leam from BonncvKC power Adnrinsuator to projcm PL~pants 0~~~~~~DEscau TIGN oF 1975 A BGNss AND CRETAN PkovlsloNs GF TBE RESGLIITIGN

~i~SurrzasIENTAL RESGLIIIIGN

...................

The Bonds and the 1975 A Bonds Subsequent Series of Bonds Additiosal Indd>MŽcss Other'Ihan Bonds....................

Consuuction Fund;App))carion of Btmd Proceeds...............

Other Funds Established by the Ress)u&>n; Flow of Reiusues.....Cezts)s Covenants Evests of Default;Retmri)cs..Amesdmutts; Supplemental Resoturioas

..........~............

REGISTRATIGN GF THE 197S A Bohos BY STATB ALTtITGR~~~NEGGTIAELE INszatrsmzs LITIGATION A'FFROVAL GF LEGAL PRocEED!NG$

TAx ExEMFTIGN Mlsc E LLANEous PAGE 24 24 24 24 24 25 2$25 26 26 26 26 27 27 27 29 29 30 31 33 35 36 36 37 37 37 37 37 33 40 47 54 57 58 SQIMARY STATEIdF (Subj wt ia AQ Respects to hforc Complete Mormztion Contained ls This Oalris)Statemeat)

The Supply System The Supply System, organized is 1957, is a music)pa)corporatioa and a joint opcrausg agency of the Smtc ot Wash)sgton.

Its members arc IS operating public uriivty districts asd thc Cities of Riehbsd, Seattle and Tacoma, all located h thc State cf Wash)sgton.

'Ihc Supply System has thc authority, among other things, to acquirc, consuuet aud opcratc planus works and faritities for thc geseratios asd trans-mlsrios of e'iecuic power asd energy.In addition to a hydroe)ecuic pro)NS, thc Supply S>stem presently owns asd opera.'es the Hasford Project, a stcam electric generating plant operated in conjuseCion vdth thc United Statm Energy Resources Development Agency's (fmmeriy the Atman Energy Cotr nMon's)New Prodtmon Reactor os thc Agency's Hasfoid Reseivaritm, rear Richland, WashisgtoIL

'I)ris steam plant has a same plate rarirg of 860,000 kilowatts, has been In operatios risec 1966 and Is currently onc of thc t<<o largest producers of nuclear generated eicetricity is the United States.Thc Supply System is currently usdeztahng.

Lv addidon to thc Projea, thc deieiopment of four other suriear generating plants.Two wii)bc located oa thc Has(std Reservaiion scar II:c project asd arc 1,250,000 kilowatt phnts to bc is operation by 1932 asd 1934, respeerively.

Thc other two arc 1,240,000 kilowau plants h Grays Harbor County, Washington.

The Sist of thcsc proj~is to bc joistly owned by thc Supply S>Stern (70%)and four investor owned uiiliYies (30%).Joint ownership of thc second project is under study.These plasts arc to bc in operarion by 19S2 and 1934 respeerively.

Thc Joist Power Flensing Cotmtfl, conshtisg ot 110 pubidc and private utilitics is the PariSC Notth-<<ust and tbc Bonncvilic Power Admhusuarios, a bureau of thc United Sta:es Department ot thc Interio, has phaned through thc development of thc H)zho rheims)Po<<ur Progzmn thc comdissrios ot cz)srisg asd future c)eetric zcsomces in the Pae)5c Notthwest.

Thc nude" r e!Cetric generating plants, ine)ud)sg~pro;CCL which will be comuueted and operaud by thc Supply+Stem arc aa Istegra)asd major paw of the p)assed c)ecuic genmarisg power c.pacity for thc region under that Progiaas Pmpose ot Lsue Thc purpose of thc$125,000,000 Wariusgton pub)ic po<<ur Supply System Nudear project No.2 Revenue Bonds, Serie 1975 A, is to Ssarm a portioa of the cats of consuuerisg and acquirisg Ihc Project.To date thc Supply S>sum has issued aa aggregate of$355,000,000 ot Bonds for the sano purpose.It has been esrim.ted that the total permanent gnaseing requLM for the Project, Ise)udisg thc Isitia)nuclear fuel corn asd isterest durisg eonsuumios, less temporary mvcsuscst Income, wIII bc S 614,000,000.

Thc Project vril!bc located on the Hanford Reservation but will be Snanccd and accounted for Independently of the Supply System's Hanford Project currently h operarios on thc Reseivatisn and all other current or planned Supply Slstem projceu.1hc project will consist of a hoTiing water nuclear eleeuic geseratisg plant<<5th a nomina)ca~ty of 1,100,000 kilowatts, together with associated faeilirics to deliver the output to thc 500 kV transmiss)on faeihrics of thc Federal Cclumbia River Power System located in thc vicinity of the Project.Cossuuerios Cosuaets asd Sehed"ia.Thc AEC czmstmerion pcisrit ms obtained on hfareh 19, 1973, at<<frich tkvm~rion of Lbc p!1st proper<<us smiled.As of Dcoembm 31, 1974, equipment asd eonsuuetion cosuacts totaling$2SS mgiion, eovm)sg appmrimateiy 7S%of the estreat)y eiriimated total direct oosstruerion asd equip.znent eosu (Ine)udisg csea)srion but czrimivc of esgiscerisg, consuuerion management, asd conris-gemrics)g had been awardM.

~As of December 31, 1974, overall constru~on was estimated to be 13.093 complete comps:cd to a schedu!cd 33%complcrion under the orign J schedule wK<<h con:cmp!atcd a commercial operarion date of September I, 1977.Commercial opcrarioa is prcseady schcdulcd for Juae I, 1978.Further Information concerning progress of construcrion, construction schcdu!cs, aad major coa-tracts B<<unzoned ia ExhiMt IIL Securit for thc Boads-thc Pa<<<!pants, Net BUUng Agre<<ments, Effect of Neir BonucvU!e Legislation, and Rate Covcaant Tho Bonds, including thc 1975 A Bonds, and thc interest thereoa arc payable solely from the Bord Fuad crcatcd by thc Resoluuon, and thc moacys p!<<dged to such Fund arc limited to thc income, revenues, r<<ccipts and progts derived by the Supply Sysicm through thc ownersUp and operatioa of the Project.including aU payments to bc made to thc Supply Sysiem pursuant to thc Nct BiUing Agreements described her<<hi, and Bond proceeds.Interest on thc 1975 A Boads will be capitaUzcd untU September I, 1977.The Parrfcfpcnrrr Thc Project's catirc capab!Uty has bcea sold by thc Supply S)>~pursuant to thc Net BiUiag Agreements to 94 P~ciYipants, consisting of 27 man!el~<<ties, 22 diwrim~45<<lcctric cooperatives located principriiy in tVashing,on, Oregon, Idaho, hfoataua and CaUfoiula,<<ach of whom is a statutory preference customer of Btmnev!U<<.

The PactiYiponts'hares of thc Project's output raago from approximately 15%to 0.005 7o.An aggregate of aptuoxlmately 225%of the output ls sha&by 64 Patt Yipants each of which has a sharc of less thaa I~io.Sec Ezhbit L Among t5c categorie specie<<aUy lnduded as expenditures that Bonncvigc may nate from thc Fimd is payment for"the purchase of elecuic power (ine!udLig the eat!dement of e!cctric plant capa-bUity)...if such purchase has been heretofore authorizoL..." BonneviU<<has smM (see Exhibit Vl)to thc Supply+stem ard each Pgriicipant that, ia a cordance vdth thc proviYions of thc Transmission Act, ii sill pay in cash from the Fund'any costs biUcd to thc Pa~pants not paM enough nct bUUng credits on a parity<<iA other BonnevU!c operating cxpmses ard prior to any payments by DonneviUc to thc Treasury for repa)znent of the Federal investment in thc Federal Columbia River Power System and bonds issued pursuant:o the Transmission Aet.Da~ncviUc projmed rcvcnues which u(U bc avid-ab'1 for suc5 purpose arc set forth in Exhibit V.Bonne"iUc is obligated by law to cfwzgc rates for elemric power and transmission of electric power which will recover the"cost of producing and irans-m!ufng such<<I<<ctric power.Rase Covvnarrr No PardYipant vdU bc i<<tin!red to make payments to the Supply System except from revenues deriv<<d from thc ownership and operarioa of its ehutric utiUty properties.

Each Pairidpant has covcaan!<<d that it will esmbUsh, maintain and coL'ect rates or<<!ages for power and energy am!other services fmnbhed~~gh its eioctric utiL'ty propcrrics which shall be ad<<i!nate to prov!dc revenues summnt to mh requ!red payments to th Supply S)amm.¹r Billing Agreemclrrsr Each of thc PartiYipants has entered into a¹t BiUiag Agreement with thc Supply S)item aad Bonn<<i(U<<.

Pursuant to thcsc agreements, eA" Participant (i)wUl m6c pay-ments to the Suppjy Systeru for its proportionate sharc of tLe Project's anrual costs, including debt servitx;, and (ii)has assigned its sharc of thc Project capability to Boom~<<.In comidcration thereof, Doaaci(Ue will credii thc payments by the Parricipants to thc Supply System against billings by BonncvUlc to the Participants for povur and ccttah ot5<<r services rendered by BonneiiU<<under other contracts.

Dcforo BonneviU<<<<ntered into thc Nct BiUing Agreemeats it dcteinrined

~t its csrimatcd aggregate bilUags to each of the PattiYipa"-ts auld be not less than 1159)of DonneviU<<'s nct bUUng obUgations to thc respecrive participants under aU agreements providing for net bUUng.BonacviUc has agreed ia tue Net Billing Agreements thai vrith respect to any future net MUng agree en4<<at<<red hto u"'.th any of thc Pmtiripants it sill determine that the mc csrimated 1!5'ovcmgc is presenL fhc Partlripanis are obligated, bc fuming no later thaa Sep:ember I, 1977, to pay thc Supply System their proportioaatc s!ares of the project's annuJ costs, and BonncvUIc B obligated to make credits as aforesaid, whether or not thc project is completed, opcrab!e, or operating amI notwithstaading thc suspension, interruprim, interference, reduction or curtaUment of the Project outpuL Effect of¹w Bonnev!U<<.L<<gls!arlonr Thc Nct BiUing Agreements provide for vo!untary and man-datory assignments of a Participant's sharc if the ct biliing credits to thc PartiYipant by DonneviUc crc insutU<<lent to oUset the Pmricipant's ob!igations to thc Supply S)item, and, if these assignments arc not suihcicnt to Mane<<the P~:ipant's obUgations and nct billing credits, for cash payments by Barmn viUc"subject to thc avaihbihty of appiopriarions for such purposes." Subsctlucnt to thc Supply Sys:cm'4 cntering into thc Net BilUng Agre<<mens, t5c Fed<<id Columbia Rivur Tramnussion System Act (scc secuoa enrided"BonneviU<<

Power Administrauoa")

was enacted a"-d siged inio Iaw The Trans-mission Act authorizes Boanevii!c to use f4 rcvcnucs srithout f" cher appropri riom of Co" gim to maL<<expcntUtures from t5c Bomtcv!Uc Power Adminlstiarion Fund ("Fu"-d")for aay purposo accessary or appropriate to carry out the daries fmposwf upon tho Administer p" rstmnt to hw.These<<xpenth-turcs must bc htc!uded ia BonncviU<<'s budges submitted~year to Co"gr~

I I' OFFICIAL STATE'>IEiWT GP WASHINGTOiN PUBLIC POWER SUPPLY SYSTEM A Hdunlefpa!

Corporation and e Joint Operating Agency of the Stats of Washlnyon relating ro fts 8125t000t000 Washington Public Power Supply Systcru Nuclear Pro jcct No.2 Revenue Dondst Series 197S A March 6, 1975 The purpose ot th!s (>cia!S:aten:cnt, ash!eh Includes the cover page hereof and the cabin he!cut is to set forth information concerniug Washington PubHe Power Supply System (the"Supp!y System").Is Washiuyon PubHc Power Supply S>vtem Nuclear Project No.2 (the"Pmjec!")as is more fuHy Ccscribed herein unCcr Ihe Project" md is$125,000,000 Wash'vyon Pubic Power Supply S>vtem Nuriear Project No.2 Revenue Bonds, Series 1975 A (the"1975 A Bonds"), in connection with thc sa!c by the Supply S>stem of the 1975 A Bonds and for thc Motmarion of aH vho!nay b~mc hatders of such 1975 A Bonds.The 1975 A Bonds mv to be issued pursuant to the Reiised Code o!>Vashhyon, Chap.'er 4332, as amended (the"Act"), Resolut!on No.640 (thc"Resdurioa")

aCopted Junc 26, 1973 by the Supply S>vtem and a reso!ation supp!cmental to the Reso!urion, Resolution ho.739 (the"Suppleiuental Resolution-)

adop:ed Mph 6, 1975 by thc Supply S>stern.'Ihc Supply S>stem has hereto!em Issued pursuant to the Rcso!urion

$355,000,000 principsl amount ot bomls for thc Pro~which bonds, the 1975 A Bonds and aH addirional series ot bord!whkJt may be hereafter Issued pur-suant to thc Resolution to pay thc cost of acqu!ring and consuucting the Project are herein caHed coHectivcly the"Bonds".THE SUPPLY SYSIEhf The Supply S>vtem, a inunitripal corpurarion md a joint operating agency of thc State of Washington, vus organized in January, 1957 pursuant to the Act.Its membership H made up of IS operating public unity districts md thc Grics of RichlarA.Seattle and Tacoma, aH ltxnted in thc State of Washfnyon.

The Supply S>stem has the auritority, among other things, to as!aire, consuuct and operate pttets, works a"d feei!itics for thc generation and trmsndssion of elccuic power aad energy.The Supply S>vtem has thc power of emhcnt do aht, but it is spec!ScaHy precluded from the condemnation of any p!aus, works or faciHiries ovtted aad operated by any rity, pubHc uriHty dhtrict or privatdywwncd e!ectric rtility.Thc Supply System has is principal ofHcc in Ricldand,>Vashinyon.

The management and control of thc Supply System is tvsted in a Board of Directors composed of representsuvcs of each of thc members.Regular meeriny of tbc Board me held quanerly.Thc Executive Committee of the Board ad!ala!stets the business of the Supply System between regahr meany of the Board.The Exccutivc Commiuee hoMs regular mcctmy!vice each month md special rneeriny as of!ca as thc business of th>>Supply System may requLm hfembers of the Supply S>vtem and theirrespccrive rcprcscrtativcs on thc Board o!D~rs mu as foLtows Public UHHty Distfiet ho.I of Benton Cotmty................John Ga'Csbury PubHc Uriility Distris No.I ot Chelm Comty..............

'..KLby B!tiicy!ey Public UtiHty District No.I of CLtHsm County................Alvia E He!cher PubHc UtiTity Disuict No.I ot Chrk Couaty.................Ed Fischer'ubHc UtiTiry District ho.I o!Con!itx County...........

"".D.E Hughes'oward Prcjt Thoutas F.hrcupa G!ena C.Waltdeyv John L Toevs John J.>Velch~Ihrold W.Jenk!ns Gerald C.Fenton Amo!d J.James Edwin W.Taylor Quenunhftxer Laac Bray Gordon Vickety'olf E Jemteymf>V.G.Hu!bert, Jr.v A.J.Ba:cdcttti Frmcis Longe Public Unity Dhtrlct No.I of Douglas County...............

Pub!ic Urgity Dutrict No.1 of Ferry Co!sty.................

PubH-Utlti!>Disuict No.I of Franklin County...............

Public Uili:y Dis:rictÃa 2 of Grant Comty.................

Pub'.ic Utility DhuIct Ntx I of G:a)v Harbor County...........

Pubbc UtIIIty Disuict No.I of Kltutas County................

Pub!ic UtiTity Disuict No.I of KHchtat County...............

Public Uu!ity District No.I of Lewis County.................

Pub!ic Utility District No.3 of h'1ason County................

PubHc Urility Disulct No.2 of Parigc County.................

City of Richland.City of Seattle....Pubhc Uugty Dis:rict No.I of Skamsms Co>>ty..............

Public Ut!Hty Disiict Ntx I of S~mbh County.............

City o!Tacoma.PubLc UtiTity Disuict No.I of>Vahk!skum Cotmty............

~Exccetivc Cow-ttua Meta!vs The Supp!y S>xtmt presently<<n:ploys approx!ma!riy 320 pert!ms, Indudiag a higMy qusHSed tcchniceI staH~hose combined experience In the nuc!ear Held totals over 1500 mm.yean and whose trsfnhg Iae!udes dhcip!ines in electrica, mechancal, civil and nudear eng!neering.

Through thc opera-tion of thc Hsnford project daaibcd below thc Supply System staH has accmnulated substandial cxpcrl-c" cc ia thc opemtioa of a large suan electric generaring f riHty, Tbe Supply System's Generating Projmts Tbe Supp!y S>vt m ovns and operaus an 860,000 kHowau<<Iectric genera6ng plant and asso-ciated facHities (the"Hanford Project")located on t"e Her!oui Reservarion of the Un!md Stems Energy Resources Development Agency (the"ERDA"), onc of thc successor ayncies to thc Atomic Energy Commission (thc"AEC").The Hanford project was coastntaed ia accordance with aycemcnts bo.tavcn the Supply S>stem, thc United States of America, Department of&laterior, acting by and through thc BonneviHc Power Aduuulstrator

(" Bonneville"), aad thc AEC.The Ha<ord Projem is currently one of th two lsryst producers of clcctririty generated from nuc!ear cncrgy in tbe United States.Steam is proviCed for thc Hsnford Project from thc Ncw Production Reactor (the"NPR")owned and operated by thc ERDA.In 1963, thc Supply System Issued$122,000,000 Hanford Project Elecuic Revcnuc BorW (~"Hmford project Bonds"), of which$60,000,000 uvre outstanding as of January I, 1975.Thc Supply System a!so ovtts and operates thc packavgd Lake Hydroelecuic project with a nmtepistc rating of 2T500 kVa.Ia 1962 A 1965, thc Supply S>stem sold$10,500,000 and$3p00,000 packwood Lake H>riroelenric project Revenue Bonds, of which$13,1SI,000 werc outstand-ing as of January I, 1975.'Ihc Supp!y System Ins bcgua preHminary work on a 1,250,000 hloaau nuclear cicctric generat-ing plmt knovn as the tVmhinyon pcblic power Supply S>vtem Nuriear project No.l.'fn June 1974 thc Supply System issued$77,000,000 principal amount of revcnae notes Lv orCcr to pay a portion of thc costs of such pre!i!treaty work.This plant vriH be constmctcd on the Hsnford Reservation of the ERDA at a site near thc project and is prcscntly scheduled to begin commerrisl operation ia 19S2.Thc Supply S>vtem has abo begun preliminary uvtrk on a 1,240,000 kihwatt nuclear plant at a site near Sasop, in Gra>v Harbor County, Washinyon, to be known as Washinyon Public Power Supply System Nuriesr Prolea No.3, which will bc 70'Io owned by thc Supply System aad 309>owned by four fntvstor ov cd uu"'ties, and it hs Hnmced its ownershp sharc of prcHmimy work in om-ncction with sech plmt wiX thc procuds ot a$29,000,000 note Issue.Commcnriai operatioa is prcserdy scheduled for 1982.la response to arequest of Lse Pubhc Power CcunriL consisring of morc thsa 100 s:atutory prcf-ercnce cunomers of BonncviHe, thc Supply S>stern has also begua prelimiasry worL on ri:c Supply System's Nuricar Project No.4 and Nuc!ear Project No.5.It n presently phnncd that Nuclear project No.4 will be a duplicate pimt of thc Supp!y System's Nuricar prohct No.I on the Hanford Rcscrvarion and w01 be phccd ia commercial op ratioa ia 19S4, and that Nuclear Project No.5 will bo a I 4 4 1'I duplicate plant ot thc Supply System's Nudear Project No.3 at thc Satsop site rear Abadcen in Grays Harbor County, Washington and wiU bc phced in commercial operation in 1954.The Supply S>stem hss issued$l7.500,000 ot revenue notes to finance this!cork md is plannhg to issue additional obliga-tions ia a tmal amount up to approximately

$100,000,000 to retund tM$17,500,000 of revenue notes and continue thc prelimiaary work.Thc Supply S)stem is ncgofisting uith the investor<<ouced utilidcs who sharc ouvicrs!tip in thc Supply S)stem's Nuchar Project No.3 concerniag possib>>shafing ot out>>tship of Nuclear Project<<No.5 acd the Pager Sound Power&Light Compsay's Skagt Protect to bc located in Skeet County;Washington.

AH pro~heretofore undertaken by thc Supply$)stem except Nudcar Projects Nos.4 acd 5 have beca financed as separate s)stern*The obligations issued with reipc t to each such project are payablc solely from thc rcvcnucs ot that pioject.The project is simihrly being ficaneed as a separate system.It is antiYipsted that Nuclear Projects Nos.4 and 5 and, pahsps, the Skagit Prouct wiH be finmced asones>stem.

Oa thc bss!s ot the estimated cost and interest during constmction for thc Supply System's Nudea Projects Nos.1, 2 and 3, it is estimated that the Supp!y System will rcqdre long-term financing for these pcs~~betu'ecn now and 1930 in excess ot 52,000,000,0CO.

The firi'ong-term finaneings for Project No.1 and Project No.3 are projected for hte 1975 or ealy 1976.The fitst long-term~g for Projec<>d ia morc derail under tho csptioa"ihe project-project Financing Requitements".

Thc next sale is presently conte pla>>d for thc sununer of 1975.SECIJRITY FOR TIIE BONDS Principal of<<cd iaterest on the Bonds a:c pa)ub!e solely fmm the Btxtd Fuad cr",A by u Resolution acd thc clone)'s p!edged to such Fend arc HmItcd to the hxmc, revenues, receipts a"d p.'ofits d:rived by the Supply System through the ouccrship and operafioa by it ot thc Project, inclcdhg aH psymeats to be made to thc Supp!y S>stem pursuant to certah agreements (thc"Net Billing Agrcem:ats")

described belo!v, arxl Bond proceeds.Interest on the Bonds wUI bc capitalized to Septcmbcr I, 1977.Tbe Bonds arc not general obligsiions ot the Supply S)stem snd neither thc faith and credit of tt>>Supply S)litem or thc State ot)Vcshington nor any rcvenucs of the Supply S>stem derived from other Projects v'hich have been or which may hercaQcr bc undctta'ken by the Supply System arc p!edged to the payment thcreoL The Supply System has enter%hto Nct B!IHng Agreements ui<<k Bocnnih!e and 94 prdetcnce customers of BoaaeviUe Usted h Exhli.t I to Gus Offidal Statemcct (the"PatiYip"ts").Purse<<"t to the Nct BiHing Agreemmts (i)the Supply Sys<<>>m has sold the project's entire capabTity ia sham to thc Participants whch, ia turn, have aH assigned thdr respective shacs to BomtevZc, (ii)each Participant uil pay the Supply Systan its pro rats share of the atmusI costs (icdcdicg pfiMipd of and interest cm the Bonds)ot the project and (iii)in consideration of thcsc assignments, Bonnev!Ue wiU credit the amounts paid by the Paidcipants to the Supply System sgaiast anounts owed BonncviUe by t5c Participants tor power acd services provided uader other contracts with BonneviUc.

This system , ot offsets or credits is caUed"net bUHag".Thc Net Billing Agrecmects provid: tor voluntary acd cmdatory assignments ot a Panda nfs sharc if the net biUirg credits to thc participant by BonneviHc arc hsuKcicnt to ofisa the patLqpsnt's ohqigathm to tb>>Supply System.scd, if these assignments arc cot sutficicnt to Manna thc Psmicipsct's obiigstioas a" d net biUiag credits, for cash payzcccts by Boc"evilie"subjca to 0>>avaUabiTity ot appro-pthtions tor s!>>5 purposes." Subsequcrt to tbc Supply Systmfs entcrLng into the Net Biliing Agioe-mccts, the Fcderd,Columbia River Transcission System Aa (the"Transmission Ad"), described under the sedhn ectit.'cd"BonnevUle Power AdmicistraCion", ee ended"d sign d hto hw.Thc Tr"smitsion Act authorizes Bonccvilh to usc its rcvenucs uiithout furker appropri" fons of Congress 10 to make expenditures from the BoaneviUc Power Administration Fucd ("Fund")for any puqesc access ry or appropnate to carry out the dui!cs imposed upon the Adminh!trator pursuant to lsw.'Hiero experdi-turcs must bc Lauded h Donne!iHc's budget submitted each>car to Congress.Among the caegories specificaUy ir<<dudcd as cxpenditcrcs that Bonne!i'Jc msy make from the Fund Is pa)ment for'lhc pard>>sc ct electric power (induding thc entitlement of electric ptsct cspa-biL'ty)...

if s W purchase hss been herctoforc authofizcd..

i." BonncviUc hss stated (sce Exhibit VI)to thc Supply System and each Participant th"r, h aceordsr>>c uith the proviYions ot thc Transmisdon Act, it uiH pay h cash from thc Fmd auy costs biUcd to the Patficqpats not pdd through ret bi!ling acdits oa a pafiiy uith oker BonccvUlc operathg expenses aad pfior to sny payments by Boni.eviUe to thc Treasury for reps)xnent ot thc Fcdctal h!ustment h thc Federal Columbia River Power System and bonds Bsucd puauant to the Transmits!on Act.BonncviUc's projected revenues which will be avail-able for such purpose are set forth in Exhibit V.Bonncvilh is obligated by law to charge rates for electric power and transmission ot dccaic poucr which sill recover thc"cost ot producing and transmitting such eleetficpoucr." pa)~ts by t5e pattLdpants to the Supply S)stem wiH commence oa thc date whca t!>>project Is ready to bc operated on a cominereial basis, or January I, 1977, whichever is earlier;provided that st>>lt pa)znects pno: to thc d.te the Project is ready to be opaat:d oa a eommerciJ~

basis, or Sep>>aber I,]977, whid>>vcr B earlier, a:c Urn!ted to such a=>>cats ss BocceviUe aad thc Supply gem ape msy bc induded h thc Atmud Budgets, as dcfiacd in thc¹t Bilfing Agreements.

BonnenJc snd tbc Supply S)stem have ag.ccd that at least an amount equal to one-ha!f of thc maximum annu~l interest oa t)e Bo ds Bsued prior to September I, 1977 plus$6,000,000 sill bc hcludcd in such Amtual Budgets for t)>>period Jsnuay I to September I, 1977.The Resolcfion provides that such anouats wiU bc us:d, fitst, to deposit h the Bo" d Fund tor c:edit to the Resene Account thc amount requited to estabHsh such Accorct h the amocct reqdred by the Rcsolufiicn; secotx5 to deposit$3,000,000 ia thc Rcservc a=d Coathgcncy Fund est bHshcd h the Resolutha md;t5ird, to provide$3,000,000 for uvtrkhg c:pitd fo.the Pro~Payvncnts acd crew'ts tmder t5e Net BUUcg Agreements arc reqdred to bc made whew o: cot tha project is completed, opcrabL;or opersthg and cotwtthstscdhg the stapcnshn, reduahn or curtd).ment ot the Project output.THE PROJECT The project will bc ctmstructed, owned and operated by the Supply S)stem pursuant to aa agree-ment (thc"project A@cement")

2>>twz>>n th.Supply System scd Bocccv!Uc as part of thc H>xLo Thernd power Frog!an, a progm designed to meet thc aauYipatcd needs for power ia the pacific NorthwcsL'Ihc H)dio Thermal Pouur Program B dacfibed ia a htcr section.Locstioa ot tbe Pmjcet The projea, with the exccpfioc ot thc administrative setvice buHdhg.B under construction on thc Iisnford Reservation, approximately three miles west of the Cotumbia River and 12 miles nonh ot the City ot RichLcd in Benton County, KVa!!iagton.

The Project site has been leased trom the ERDA for a tern, induding options, extending beyond July I, 201-A Ipse ot the land in thc M of thc Columbia River necessary for thc wa:er i" take and,discharge hc'ditics is to bc executed with thc Wahhg-ton State Department of Natural Rcsourccs as soon as the area to bc less:d!s fiaaUy defiaed by th-Coips of Ecyneers'ermit.

'Ibe Hadord Resavation Ues mostly h Ben:on County and encompasses 559 square c!Ues of barm dcsert Isml ia a sparsdy setQA arcs of centrJ Washhgton.

The Resen;aticn L~s served as a nudcsr hdcstrisl centa dncc 1943.ProxLdty to nuclear support icdusoies oa the Rest tvutloa yves the site a dcdded advantage for a cce!ear power pmject.Favorab!e geegaphic, gcologimi, seismc!og)A and cHmato!ogieai chsrmefisdcs, adequate water supply, as uvH ss remoteness from large pope)afioa centem, ac fe t-es ot u site that dso coatfibute to its desirabiHty for a nudear power site.Scatde is approxLc tdy 160 s'-.!inc mrcs ficm the site~port!scd B spproximstdy 180 ance miles fmm the sltc.11<<<<<<<<<<-k~~

'4-'<<M'.K'407 4v 8 3<<a.Nr,v oc wee+w~a'3<<xfr8M<<4<<3~., 43 4,,3444M 74 D<<s<<riptlon of the Proj<<ct The Project<<(B conshu of a single unit boiliag<<"ter reactor cle tric generatirg smtioa, h ilng a nominal capacity of approxL~'.<<ly 1,100.000 kBo<<<<tts, the necessary t:ausfouaadion and related fsciTiriies to ieterconn<<ct thc gcneradng statio"<<5th thc Fcdcral Colu bia River Pow<<r System and an adininistrstive sctvice building.The phat layout and design inc!<<des coasidera44on of possible future expansion by the addiYion of another gencrafing unit.The sevea basic stmctures comprising tk g<<aerating st.tioa are (I)tea<<tor buBdL<<g, (2)radio-active waste buBdiag, (3)turbine genera or banding.(4)diesel generator bui!di"g.(5)cooBag to<<ers and cir<<v!adng water pump house, (6)riv<<r makeup wat<<r p!ant and (7)s<<rrice buiMing.The nuclear stcam supply s)st<<m will contsh a G<<n<<ra!E!<<<<tric Company ("GE-)boiling water reactor of proven desiga v ith a guaranteed rating of 3,330 megawatts th<<rmaL It wiB supply approximately 14,295,000 pouads of steam per hour at 9S5 ps!a.The spt<<m<<(B be comp!etc with stcam scp rators and driers, rccircuhting pumps and subsystems including~Lse required for normal op:rariion and for shutdo<<xi.

The turbine-generator viB consist of a high-pmssurc turbiac secdoa on the san:e shaB with three lov'-pr<<ssure turbine se<<tions aad an electric g<<vera;or irith a nomktal capacity of appoxhuxtdy 1,100,000 kBo<<<<tts.Transformadoa from 25 kV to 500 kV will be pmrid:iL~Thc condeaser cooBag<<<<:er<<(B be discharge!

from the turb!a~en<<rater buBding to six~al draft evaporative cooling to<<vrs.hick<<up water to rep!acc thc cvapor tive losses of thc eucv<<ting water mll be ob:ain<<4 from thc Columbia Rior.In addiYion to the service buBding at thc site of thc gener-"ting stariion, thc Project indudcs an ad-tnirlsuarive servdce b<<Bding located<<Blate h thc tddtdty of Riddand, t8Vashingmn, which has beea com-p!<<tcd and provides admfnisuativo space for the Project and ether Supply S)stem activiYies.

Inldal Fa<<l Core The ini'tial fuel core B bciag svppB<<d by GE as patt of thc rex<<mr eonuacn The fu<<1 ass<<mbB<<s la<<iud<<d ia the inids!core<<(B bc essenvaBy identic<<!to hiYial corn fuel assembLies b<<ing suppB<<4 by GE to other el<<<<sic utilities ia the Unit<<d States ia thc pc<<iud 1975 through 1981.GE cxp<<cts to pro tide over 30 initial foci cores during that period to some 19 dB!ercat utiLidcs In<<at<<d in various pans of tho Urdted Statm.Cons tructioa Contracts aud Sch<<dale TheÃucl<<ar Regulatory Conunission (another sv<<c<<ssor agency to thc AEC)(thc"NRC")con-struction p<<rmit was obtain<<d on hfarch 19, 1973 at which time construcrioa of thc p!ant proper was start<<4.Thc instaBariioa of temporary faci!itics is comp!ete.Thc re<<<<<<or building subsuuctvrc has b<<en comp'!eted an4 thc containment vessel which rests oa it was 83.2%comp!<<tc as of Dcccmb<<r 31, 1974.Thc substracturc for thc turbiae-gen<<rater Wilding has been comp!<<ted and w>rk fs now in progress on thc tvrbhie pedesml and thc walls of the turbine-generator b<<Bdiug.The substructure of thc radio-act!vc<<<<stc building is comp71<<te aad<<virk is starting on thc superstructure.

Concrete work on the spray pcs and service water pump house is ncarhtg complerion.

KVork has s:mted oa thc cooliag tower bases aad thc<<Lola;ing water pvmp house.As of Dc<<ember 31, 1974, overall consuvction was est!mat<<d to be 13.0%comp!ete compared to a s<<hedv!<<d 3S%compt<<tioa vnd<<r thc oriynal schcdu!c<<hich coat<<mplate4 a commercial op:ration da4<<c of Scptcmber 1, 1977.As of D<<<<ember 31~1974, equipment aud consuuctioa contracts tot<<Kng$25S,058,567 have b<<<<n entered into.Furth<<r information conc<<ruing major cquipmcnt aud consuuction contracts is contained in Exhibit Ill.Thc sdi<<d<<J<<d da:e of comm<<rdal op<<radon has bc<<n d<<layed to Junc I, 1978.'Ibe Conttrucriicn Enf5n<<er is of the opinion that thc program for consuuukin is realistic an4 a co~<<rdd operaron dsm of June I, 1978 has a r<<<<sonable chance of adiicv<<m<<nt; however, it wBl squire a sfgiGma improvc-me=t in the r" of consuuedon ptugrcss.KSXISIATKD PROJECI'DIA4iCING REQUIRED St<<it<<tares and Iinprovcnienu

~Re"etor P!ant Equipm<<nt Ttubo41<<n<<radng Pl<<nt Accessory E!<<<<tric Equipm<<nt hBsceliencous Pow<<r Phut Equipment Station Equipmeat Tempor~Coastrvcriion Faciliries Subtotal Dirca Ccnsuucrion(I)(2)

Nvdesr Fu<<1(3).Sa!<<s Tax(4).Consuvetion hfanagement(1)

O<<u<<r's Direct Cost(5).Coating<<a~(I

)Esriimated Bond Discount and Other Finandng Expenses Capias<<4 Interest During Consuvcrion

.Gross Requircmcat Less: Est!mat<<d lao<<me from Temporary Intustm<<nts

.Ã<<t Require-ent

$64,624,500 12S,697,900 108,003,000 30,999,900 2,779,900 6,643,100 4,080,800$345,829, 100 3S,980,000 19,240,500 57,818,000 44,100,000 26,478,200 7,326,000 125.60S,000 665,379,800 87.379.8M 8 6 74,0MOM (t)ts<<3<<4<<o<<38tuat<<s by C67<<it<<87<<Coa P4<<rie<<<<r<<<<esse<<4 ia 878btbh!IL (2)I<<<<tiit<<s<<6<<st<<&a.(S)its<<imt<<6t by tb<<8@sty Syit<<m.'4)Ie<<tot<<s si!<<s tax oa 73<<<<t<<sr fuiL (>)As~vd by tb-.S>>y Syr~fed~<<ov of tb~Proj<<ct Fiaaadng R<<qu88<<m<<nts Thc Bords h<<rcto!om issu<<d wem,<<ad the 1975 A Bonds arc being, issued to Br<<ace a portion of thc cosu of cons~<<tL~S and acquiring thc Proj<<<<L AddiYional Bonds necessary to compl<<t<<the gaming of the Project ia Ow estimated aggr<<gate piincipal amount of$134,000,000

<<iB bc issu<<d ia thc future.Assuming Be additioaal Bonds<<(B bc issued h more than onc series, it is expect<<d that the next ser<<s<<1B be issu<<d during thc summer of 1975.'Ihe anmunt of Bnanciug tas been bus:4 oa the a<<tv<<i interest rates for thc Bonds herc:ofore Bsucd, ad manA amtusl Later<<st rates of 7.25%for the 1975 A Boads<<md 7.25%for thc balance of thc Bonds.Based on thc foregoing thc totd Baancing r<<qvkemcnu for the project are showa ia the foBo<<1ng tabulariiim.

'Ihesc estimates are based on thc project b<<ing placed h commercial operation by June I, 197S.A sign!6<<ant dday h project completion wou!4 result in an increase ia the finar4<<lng rcquircm<<nu.

For furth<<r information s<<e page 49 under the caprioa"Conurvuion Costs and Coastru<<tion Contracts." 12 M In addition to thc foregoing amounts obtained through issuance of Bonds, funds reqidrcd to aake the necasary pa)vncnts to thc Reserve Account in thc Bond Fu".d, to ptovidc<<v7rkieg capital, to provide an initis)Reservu and Contingency Fund and to provide a contingency for fuel arc expected to bo obtained under thc bet BiBing Agreemcnts desaibed Mow during thc period beginning January 1, 1977 and extending to September I~1977 as follows: Re<is<<Account in Bond Fund(1).iVorking Capital(2).

Reserve and Contingency Fund(3)Fuel Conriny"cy(4)

Total$21~127,000 3,000,000 3,000.000 8.000.000 535.l'7.000 (t)Eiumstod smo5mt rcucfrod by rbc Rcietcuoa.

(2)Ame3mt 533bioa to funhcr saitystt Sad approval by Bee53OVxh acd ihc Supply Ssstoiiu (3)Am530mt r05!73!red by the Rose!aueiu (4)EOumstcd smo33ct to be p753vtded from advsrreid na btt!353s io pormii fowl!as of sasust fust cata ta ihc cvoei of s ei Y'st ported of pr70rcr supply.Am535mt iubioa io f3357hcr s53stysls sid sr,iovs!by Bemiovti'N sed thc Suppty Siswm.If tor any reason such amounts (other than the fuel conringcncy) are not proiided under the Nct Bifiing Agreements they will bc provided through the issuance of additional Bonds.Licenses and Penn!(a'Ihc Project site on the Hanford Resavation has bccn cenificd for thc State of Waswngton by the Washington State Thermal Po<<ur Plant Site Ev<<lust!on Council as requi:ed by state hw.An AEC, now NRC, cons!in tion perndt<<as issued for ihe Project on hfareh 19, 1973.Prior to that da!e cert~i site preparation was undenaken in a~!danu<<5th an exemption issued by the AEC.Tbc certifiaition by thc State of Washingeton aud thc permits Issued by the AEC werc thc subjects of intensive invesrigation and public hearings.'Ihe construcrion permit requires that the project bc consnuacd in accordmce with applieab!c ru!cs and regulations of thc AEC, now the NRC, including those formulated to pro!ca thc environment and the public.Extcnriive quality control procedures arc being iinpleacntcd by thc Supply S)stem to assure that the requirements of the construaion permit<<ith respR~to quality of consnuetion of thc project<<ill bc met.prior to operation an opcraung license must bc obtrincd from the NRC, to which this funaion has been transferred from the AEC by!cant legisbtion.

Additional permits to bc acquired prior to ofmratfon of thc Proiea include the fofio<<ingt (I)Nariional pollution Discharge EEahration S)xtcm Permit to be issued by thc Thermal Po<<vr plant Site Evaluation Coatrii of the State of Washington, (2)petteit to bc Issued by thc U.S.Corps of Engmcax under the Federal Rivers 8 Harbors Aa of 1899, (3)venus buiLhg""d lusts)lation fmpeafon perm!4 by thc Washington State Department of Labor and Indusrries, and (4)a Water hVifiidrawal pc!~L if required, to be issued by the Washington State Thermal Power Plant Site Evaluation Counrih Projec!Output'Ihe Projca is expcctcd to have a net pcahng capsbiL'Tr of I 093 000 kilowatts and fs exp~to bo capable of producing abou: 7,200,0G0,000 kilowatt hou!s annually.During a eriricai period of power supply h thc pacific Northwest caused by water shonage, it is expand tha thc pmject would bc cs)!ed upon to produce the fu!I amount o(cncrgy that it is capable of produrin~~

During other periods, however, Qmm<<ill bc tiaa when surplus<<uter will be ava!!able to genaate power at existing hyd~ectric pro}cas thereby pcnnitthig a rcduaion in the total amount of energy produced at thc therari elccrric projects to bc construacd under thc Hydro Thcnnal Po<<ur Pro~, in:luding thc Pro;ect.Proj~f Annual Costs Esgaa&an A costs of thl pr00jea based on 1974 a<<a of labor aaf matcriUUS ei"ted to thc year 1978 am gvcn in t>>folrowag table.Ks aMc~gee.eon of 7$00 G00000~7 14 I~t hours annually.'Ihe costs rcfiect those operating costs that weld be charsctaistic ot a mature plsnL The Supply System anticipates additionsl expcnscs of$250,000 and$125,000 during tbe fint two oper ring years, respeaivcly, for Project monitoring.

ESXDfATED PROJECX'NNUAL COSTS$47,220,000 4,722,000 2,000,000 5,5~&,000 1.315.000 Plxso COS7$!Intern'.and Aaorrization<t>

Pa)=cuts to Rcscrvc and Contingency Fund Insurance Operation and hfainmn nce (Fixed)tn A~n:strative and Gcnerssm..Sub:otal.Less!Surplus of Prior Year's Payc~t to Ress!su amf Connngency Fundo)....Total Fixed Costs VrtatxBLB C0$T$: Fuel Cost.Operation aud hfalntenance (Variab!c)u)

..Taxes$60,782,0GO 3.322.000$57,460,000

$12,996,000 683,000 1,440.000$15,119,000

$72,579,000 2,249,000'fhe taxi annual cosa rcferrcd to above arc bmd on level dcb!servLe over a 35)ua pcriod and on estimated 1978 Icvch of labor and materials.

Thc Supply S)xtcm sd Bonneville anriiripatc that maturi-ties of thc Bonds<<ill not be scheduled to yield levvl debt service throughout thc period.Variations in aa:ual costs<<ill result from sari scheduling to the extent that actual debt servLc varies from the asamd level debt service.Reference is tnsde to thc reports of R.W.Beck and Associates, included herein as Exhbit H, and Burns and Roc, Inc., fnduded hcrcin as Exhibit III, for addiYional h!onnation reg--ding the projea and its cosbn BONNEVILLE POWER ADMLOTSTRATION Bonne>2!e, a bureau o(the U.S.Department of the Irtcrior,<<<<s established by thc Bonneville project Act of August 20, 1937, to build transrtussion fa&itics and to market power from Federal hydro-electric projects in the parifie NonhwcsL Such projaa now numb:r 27<<ith an inta!fed capaciiy of 10,995,900)dfo<<uttL Thcsc projects and authorized ncw projects and additions at cxisthrg projects<<i!l hav<<hcn eoapkted, an instri!ed capority of approximately 28,032480 kilo<<utts.

Bonn ville's!!ant-~on fsefi!ries i.chde over 12.050 tniTa of llS kV to 500 kV ac and 800 kV de ansrndission lines.These tr~on f&iYics to@Lb:r with th hydroelectric project aenticucd above coaprisc tss: Fcda J Columbia River Power Systan.Total Variab1e Costs.TOTAL A.'7'RUAL COSIS Less: h:tercst Earnhrgs on Rose!su Funds.Nxv A..AL Coszs~...$70,330,000 Hrr 5..7733 hr PR KRUW tr HoUR (7',ONON 3VI03............

9 77 llvl 0330M 0 lrl'30r'~~l 0 0~3!<<3', a 725570 ietcrmt rite eo um!975 A Beads, aed a 725%semis!tamrcn rate on the bstsr3ee of the Beedu (2)EOumstod!shoe sed mstcriih coins ma!swd te tp7$fcwh.(3)Competed ss f53l!5307s:

Psymcsi m Roiorvo sed Ceeuezoeey Fvsd SS,722,000 Less: EOumited s55HVH53t rcrtmred fer rceo770!s, rept tecmeau snd add;ue57S Nci 533ipti35.$3 J22.000)rot Nap!as msy be uied for puipoios aha ihsn redceuea h power eoits h~vr!ih tHH3 Bonnev!Uc Revenue by 3fajor Chsslgmt!en of Customers(1)

Reed Year Ended Jete xc prehrcaev Costom ere O'er Rucute Udn des Trv ann bdea Scree~ah Total 1968...1969...1970...1971...1972...1973...1974...$49,134,719 55,752,314 58,419,581 64,078,043 69,452,035 74,669/46 83,034,000 (t)From ReeamiGc Summary ptcted h Decemtcr tpys.$124!5,SIO S39,49S,338

$16,739,045

$117,8S7,912 16,967,117 46,204,161 18,353,608 137,277,200 t 20,319,033 50,036,203 18,S7S,209 147,680,036 25,!20,610 45,4!S,745(2) 21,060,576 155,677,974 37 918,589 45,733,067(2) 22,990.720 176,094,411 37,146,777(3) 44,014,159(2) 21,543,674 177,374,156 31,51 S,OOO(3)46,162,000(2) 21,343,000(4) 182,054,000(4)

Phsacid Dso, 1374 dsts fran Pcderd Co'webb Rivet Peawr System s~cern.Tbe major psn of the 500 kV and 230 kV backbone trsnsmisrion system in the Paclge Northwest h o<<vted by Bonnmk'Ic as a rmu!t of is ro!e in const~rag transmission fsriUUes as part of the Fedcml Columbh Riv<<r Po<<cr System.BonneviUe trammels over thc Federal Cola-bia River Power System thc major ptutlon of thc po<<ur from I 1 nonfederal projects to various private and pubUc uuTiries in the Pa&c Northwest.

This s><<tern represents approx!mately 8098 of the bulL power~Ž~ion eaparity for the P~c North<<ust.

Thc Federal Columbh River Power S)vtem has interconnections

<<4th other regions in the United States and Canada.Three high vo!tagc transmission line hterconnections (two 500 LV ac, onc SOO kV de)of thc PasrSe Nor;h<<vst-Pacigc Southwest Intertie have been completed and am now in operation.

T<<vs$00 kV ad Uncs hterconnect tbe Federal Co!vmbia River Power System<<ddt Bridsh Columbia, Canada, and several 230 kV ac lines intereo"=cot thc emt m portion of the s)<<tern vrith uuTitfes in adjacent Canadian provtnees and the hfov-"tsfn States.These Intereonnecrions pnyride, ia addirion to tuutusl support ia the event of a breskdo<<m or emergency, the means to carry capacity and energy which h surplus to thc Pac(Se horthwest~ds to these ar:as, and conversely to mrry sutp!us cspschy and energy from tssc areas hto thc Pacffh Ntuthwest.

On October 19, 1974, thc President signed into I w the Federrl Cola-bia Transmisrion

$3<<tern Aet (Pub.I No.93-(54), which cstsbUshcd a ncw met&for Snanring Bon"evUIe's comtv ction and operating program.Under the Transmission Act Bonncvf lie is authorized to psl is cost of opcmting~and maintahing thc Federal s>stern from is revenues and pay thc cot: of conssucrion of additional faciliYies from revenues and revenue bond proceeds.The Bonnet(Ue Power Adnuaistration Fvnd is established into<<hich ail ot BonncviUe's revenues (i<<!uding trust"nd fund reccips), props from revcr.ue bonds, avd appropriations arc deposit+4 Bonne<<Ulc is authorized to scU up to$1.25 bUUon of rcvenve bonds to the Secretary of the Treasury to&ance the txmstvzmlon of addidcm to u trm 16 (2)Tbo defame in tadmtrid rcvccum wss primsrily due to sb<<Moxa of dem'em po"'s h tbo am aA to e"~.meat by L<<mcvP's of hterrupdbto po<<vr to ccrtdn of its fc'uartd cmte-crs.(3)'Ibc dc Leo ia 04cr Etcetric Unyides'evenues

<<<<s due to low power svsihbKty aed t<<vested uc~of preference evutomets.

(4)SNNO.OOO of Trsesmi<<tcn Strvke sed O~is eve mfssfon s)xtem.By this method of using revenues and revenue bond Snsnchg Bonnevigc expects to avoid the nmxf ot additional'epp~riations of Congcu to ca~out its program obUgatiom The Transmission Act re&crees Btxmcv!Ue's criynsl nussion and authorizes Bonnm(Ue to con-struct addiYitxs to thc trsnsmisrion s)stem<<ithia the P cific Northwest to intefyztc ad transmit the e!ecsic po<<vr from existing or additional Federal or non-Federal gcnerathg units, provide serv(ee to Bonncv!Uc's customers, provide interregional farilities, and mahtsin the electrical stsbU!ty and elcctrical re!iabTIty of thc Fcder J s)stem.Bonncvib'e mmnot beDn constructhg any major tramnfssfon f ciiitics intended to bc uM t>provide sctviccs not previously provided by BonncviUc with is own f~tlcs until such construction is spcclgcsUy approved by Act of Congres<<'Ibc Transmhsion Act dso resfErms BonveviUc's obligation to charge rates for e!eetric power and transmiss!on of cleetric power wb!ch<<!U recover the"cost of producing avd transmitting such cleetric power.In adtvtlon the Transnrission Aet'desiutates BonnevvT!e as thc msrketLvg agent for JI Corps of En@'users a"d Bureau of Rcchmauon generating phns, excepting thc Green Springs Project in southern OrcDsn.prior to ths designation BonneviUc<<-s dsignatcd marketing agent for these projects by a~of thc Secrct.p cf the lnterior.'Ibc formdiz tioa of this designation cnsurcs thc rcvcnucs Rom thc sale of po<<ur from~>>projects will accrue to the Ftmd to pay Bonuevt.'e's expenses, Additional Power Supply In cddirion to the Federal h>vlroe!ectric projects, Bonne>!Ue has act!aired additional power supply and hydro smmge to ensb!e it to eonthuc to meet its customers'm!uiremcns.

Uadcr agreemcns executed in]963 by BonncviUe, 76 urility mstomers of BonncviUc ami the Supp!y S>stem, Bonnevkue exchanges&a po<<'cr from is system for the output ot tbc Hauford Project of thc Svpply System.In 1964, Bonnet(Ue, acting joht!y<<ith the U.S.A~Corps of Ecglneers as thc United States Entity, pursuant to thc Treaty Bcnveen the United States and Canada Rehtiug to the Cooperative Dcvdop-ment of bVater Resources of the Columbia River Basin, and pursuant to certain agrecrnents cxecutcd h connectioa vdth such Tres:y, obtained certain rights to 1$,500,000 amc-feet of hydro storage on thc Columbia River in Canada.Under Phase I of thc H)pro Therma!Power Program, Bonne<<U!e will obtain throu+thc Net BUling Agrcemens the cap"biTity of the project upon its completion and through rimihr agrccmcuts thc Supply S)xtem's sharc of the capsbihty of Nue!ear Project No.I and Nuchsr Project No.3 and the City of Eugene, Oregon's 30$$sharc of the Trojan Nuriear Project.After)983 Bomcv!Ue does not expect to a~aire clmtrie power from ncw thermal projecs to mew thc Iosd gro<<th of its pmferencc agency customers.

Rather, mtder Phase II of thc H)vtro Thermal Power Prop~~, Bcnuev(Ue expo~to aet as agent for many of its prcfcrencc customers ia+pairin Jte e!cctric po<<vr and energy necessary from thermal projees to meet thcsc custom:rs'utmc locd gro<<th.BonnevU!e Contracts Bonneville nsrkcs power to 153 custom, including 109 statutory prefcreno:

cus:om h tho Pa E North<<ust (public bodies aad coopcrstivcs which have prcfercncc avd priority upoa power from Fedora!Co!umbh Kiver po<<ur Systczu pursuant to the BonncvUh project Act, as amcadcdl~17

'I 1 F j'4'I 4 the terms of vaqous power sales contra"ts.

E"h of thc Participants is a preferene>>

anmmcr and H a party to at last one such pouur sales contract requiring pa)vuents to Bon"eiiUe for the purchase or exchange of pouur.the operation ar.d niUntenanec of faili:les, or thc transaUission of power over thc Federal Columbia River Power System.Sv h contracts gener Jly provide for the saic""d delivery of 5rm power to a preference customer in the amount of its requirements for power over and above the generating rcsourecs, if any, that the prcfcreneo cus:omar has available to serve its own loads.Bonne-vUle's obligation to meet a prcferencc customet's requirenients B e5eeUve for the term of thc cortraet unless BonnciiUe gives the pref<<rcnec customer at least eighi years'prior notice of Insu!5cieney of suppl>;These pouur sales contracts<<!th prefere~customers are usuaUy for-term of 20 years.Bo" c-viUc expects to negoUicdc ncw 20 year power sales contra-ts vdth aU prefcren-e customers to supply their Iced grouth requirements imtil 1983 and fixed amounts thereafter.

Thc PubLc Pouur Gxm il M~Bonneville are eturcnt!y studying thc aUocation of pouur to these customers after Ju!y I, 1983.The power sales eontrwts contain proviions for a rate review once each 5vc years.Rates are proposed by Bo~tiUe and become effective upon con5rmaUon and approval by th Fedora!Power ComnMion ("FPC").In 1974 BonneviUe submitted proposed rate increases to the FPC avcrayng approximately 27~o which were confirmed and approved by the FPC cf ective Dceember 20, 1974 for an interim period dnding no later ihan December 20, 197S.Thc eon5rmation and approv J of such rates for thc full 5vc)var period ending December 20, 1979, is now pending before thc FPC, amf BonncriUc cxpccts that thc FPC will approve such rates for such period in thc near future.'IHE HYDRO TTIER)LLL POI)ER PROGRAM AND POWER SUPPLY Df THE PACIFIC NORTHlVEST Thc H)~Thermal Power Program was conceived by thc Joint Power Pl~8 Coon.3, consfsdng of 110 e!eetric cooperatives, pubUc utiTities and private ui'indies in the Paei5c Northwest and BonnctiUe, in order to plan thc eoonUnatfon of existing and future thermal ard hydroelectric resources in thc Paci5 Northuust.

'Ihc major part of thc power supply in the rey'on has been historieaUy from hyd:oclearic resources, but the remairdng hydro projects to bc developed wUl be essentiaUy for pecking power rather than for b4c load.Thamal power will provide an increasing porUon of thc base load resourem in thc frture.The corn%nation of h)dro peaking and large sca!c thermal gencmting phmts uw found by thc Council to bc thc soundcst plan to aehicvc Lc ahns of the H)vtro Thermal Power preyed fhc ptin-ciples of Phase I of this Program and thc Fed~government's pardeipaUon through Bon"cviUe, thc Army Corps of Engineers and thc Bureau of Ree!amaUon have bccn cndorsaf by eurirt mid previous federal~Uons andby the Conyess.The me~hers of thc Joint Power PLtnning Cotmal have cone!uded that thc H)4o Tha&Power Proyam sill: 1.Best preserve th environment and natural he utica of thc P'aci5c h'o4wmt.2.Mate efUeient and econondc usc of~s FederJ Columbia River Power S)>tern.3.Obta'in tR economies of scale from large therm J genemUng plans.4.hfeid thc omput from hrgc thermal greraRg phmts with that hom cxbung bye gencradng units and the peat!ng genem"'on units wheh w~J be hstaUaf at<<sist:"8 d~, to achieve thc most economic and rZiabic power su7ply to racer thc power mq"wments of u~PaaR hteethwcst.

18 Pico I Paede Power 8;Ught Co.and The'lVasoJcyon lVatcr Power Company (CentraUa Project).............

~Cent:eUa, Wa.CoJ-5rcd 2 Ponland Ge" eral Eeetric Company (Trojan Projea)St.He!ens, Or.Nuclear 3 Pae!5c Power g Light Gx (Jim Br!dyer ho.2)....Rock Spqny.Wy.Coal-5'Jim Bridoger No.3)....Roc'k Sprinw, Wy.Coal-5red 4\Vashmyen P bUc Power Supp!y S)stem (Nuaccar Pro~,t ho.2).........Hanford, lVa.hu!ca.5 Portland Geneml ELctrfc Company (Pcbb!c Spriuy ho.1)...............

ArUnyon, Or.Nuc'ie-6 lVashinyon Public Power S"pp!y Sytem (Nuclear Prolect No.1).........Hanfotd, lVa.7 lVashfnycn Public Power Supply Sys:em (huc4ar ooiao.3).........

Sl p,w.ocat o>5 c i~co Rcco"v~R" (2)Currently fn oper tion at redo'apacity.

'Ihc area uulicties have ident!5ed adcUUona!grerating projects ref so=a of uhieh are currently under development or fnvcsdgation to m lVhilc the speei5c ro!c of BonueviUc has changed somewhat from Ph Power Proyam, the area u656es arc conunuing to plan aud buttd genuatio on a coopers&c schedu!c.Such thermal gcneraung pfsnts arc tabu!ated 1,400 (2)1,130 Dc-1975 500 Junc 1976 500 July 1977 1,100 Oct.1979 1,260 July 1982 1,250 Oct.1982 I/40 SepL 1982 Nuclear ried to as Phase II projeas, cct forecasted load gros." asc I of thc H)vfro ThermJ n and tramm!stion facUiUes below: Phot No 1 Pctoctpct~Smt Ioec eton Pa55c Pov,ur tk Light Co.(Jim Bridget project No.4)Rock Spriny, Wy.Coal-5red Pordand General Electric 1)...............

"" eardmatL Or.CoJ-5red Pugct Sound Power&IJght Comfy (Stay't ho.I).Sedro WooUg, Wa.NueLar KVashino~on PuMic Pouur Supply S)stem (hudear Pro;:et No.4).........Hanford, Wa.Nu dear lVaihinyon PubLc Pouur Supply S)stem (Nuclear Proc>cet No.S).........Satsop, Wq.Nuclear Pug:t Soimd Power I;Light Company (SLay't No.2)..Sedro WooUey, Wa.Nuclear Po<a:d Gcncral ELetric Comnany (Pebbh Sp."my Na 2)...............

Arbngton, Or.Nues: discussions uncLr Power Reqckements and R~pabU!ty of uiUt utile for usc in West Gro: p.o)o (2)Ca 19 333(2)Sept.1979 500 Ju)y 19SO 1,288 Fcb.1983 1/50 AptU 1984 1,240 hfer.1984 1,288 Fcb.1985 1,260 July 1985 Th: Phase I H)<o'Ihetmal Power Program thamal generating plans arc tabulated below: Raeca PcoacNo Pctoctpil Cepoctcr Koecar S oaoc Ioecuoa~ts~Dcec i) 4 t~

Pcrcvat 1976 1977 1978 19'79 1980 1981 1982 1983 19S4 1985 1986 (533)(5.11)($.65)(12.86)(I I AO)(10.18)(I" 35)(4.33)(0.37)2.$6 5.00 In addition to the foregoing major projects In thc Paeific Northwest, The hfontana Power Com-pany, Pugct Sound Povrer 8 Light Company, PacKe Power gr Light Company, Portland General LUccuic Company and'Ihe Washington Water Power Company arc eomtrucdng a coal-fired steam electric generating phmt at Cobtrip, Mont~.A portion of the ou:pu:: of this project<<fH bc Lued outside of Lbe Pad5 Nonhwcst coordinated system and tbe~e of the output vdH bc used by the.companies to assht meedag their needs within the Pacific NorthwcsL Power Requirements and Resources Long-range pianrdng of resources In the Paei5c Northwvst is baMd on anruxl forecasts of loads and resources for thc area prepared by the Pacific Northwest Utililics Con!crcnce Comniiuce.

Thc cast recent forecast (February I, 1975)was made by thc Commiucc for thc)Tars 1975-1976 through 1985-1986 (West Group Forecast).

Unlike previous forecasts which were prcparcd using phnt siansors'onstruction schedules, this most recent farcist was prepared using thc-SSUcstone" cone pt for deier-miniag the d tes on which new thermal generating plants could reasonably be exacted to b ht continuous operation.

Thc-SIUestonc" concept establishes standard dcveiopmcnt schcduics for each t)pc o!thermal plant aad identifies, as mUcstoncs, certain major cvunts h the development and constructioa of the plants.Thcsc standard"SIHestonc" phnt dcvclopmcnt schedules arc applied to cch propos:d tbruma)plant for pmpom of providing a corn!steat basis for plann'ng the addiYioa of therraal msou ces.Each plant sponsor vdH continue to maintain his own construction schedule, which may not be thc same as the SIUcstone schedule used for area rcsou:cc planning.An an J)xfs of thc most recent forecast, dated February I, 197$, ot the area's loads and resources is shovxt In the foHowing table: Loads aad Rcsourecs(l)

Northwest Power Pool West Croup(2)Yrar Esdvsstvd Pvrrcut Eodtrvs Esuwskd Rvvovvcvs Sctstcs 54mlci Tbv 3cce 30 R~d v t~II PEAK CAPAB)L)TY K)LowATTS (000)22 491 22.4S7 (4)(0.02)-(4)(0.02)23,722 23,720 (2)(0.01)~-(2)(0.01)25,220 26.09S S78 3AS-87S 3AS 26,683 2S.107 1,424 5.34-1,424 5.34 28,139 28,983 844 3.00 1,100 1,944 6.91 29,515 29,366 (149)(0.50)1,100 951 3.22 30 950 29,56S (1,3S2)(4.47)1,100 (2S2)(0.91)32.418 33,070 652 2.01 1,100 1,752$.40 33,907 34,011 104 0.31 1,100 1,204 335 35,4S3 36,172 6S9 1.94.I~100 1,7S9 5.04 37.154 3S.3S9 1,235 3.32 1,100 2,335 6.2S Etrxaov CAPAML)TY AYBBACE K)LovvATTs (000)(6)1976...............

14.625 13,S46 (779)(5.33)-(779)1977...............

15,418 14,630 (78$)(5.11)-(7$$)197$...............

16.396 14.977 (1.419)(8.65)-(1.419)1979...............

17,370 15,136 (2,234)(12.S6)-(2,234)19$0...............

1$,196 15,624 (2472)(14.13)497 (2.07$).19S I...............

19.002 16284 (2.718)(14.30)7S4 (1,934)1982...............

19.$79 16,59$(3,2$1)(16.50)825 (2,456)19S3...............

20,72S 19,005 (1,723)(S.31)825 (S9S)1984...............

21,623 20,718 (905)(4.19)S25 (SO)1985...............

22,5SI 22.401 (180)(O.SO)S25 64$!9S6...............

23,$59 23,911 352 1.49 S25 1,177 l)Resources forvexvt~r pxcific Nortbwclt Uuyuvs Ccvdcrcc c Coucriirce Guldvbccs.

3)Arcs served by uu)Yy iacmbers of rbc loiat power p~cics council.3)Alice dcdadicx icvcrvys ascii pxdaeÃ<nh>>est Utiuucs Ccafwcxcc Cocunhtor GdMhcs.Not iectudcs tbv ProBcL 5 Pxrcctbcsvs dvrotc nvcsrbc va4cs.6~deader padS.Northwest UuL'des Ccavvi~~GuucIIu 20 TIK PARTTCIPANIS Thc projem has 94 participants, of which 27 arc municipaHQes, 22 are disuicts and 45 arc co-operatives.

Thc mun YidipavYics have contracmd to purchase approximatciy 22.69)of the plant capxbTiity, thc disuicts have contracted to purchase approxiuately 56.9%and the cooperatives thc remaining 20$~o.Exhibit I attached hereto Es each partidpant and indicates its shx:e of thc project capabiliry parch asecL Thc Participan~s, BU ot whom are statu'"ry prcfe:ence customers of Bonne@%, currently obtxia aU or part of their poser supply from BonucvUIc, and, nader their power sales contracts, will have aa csUmated nct billing capacity wheh in the aggregate B esumated to bc In excess of their share of the estimated Projccps annual costs paid to thc Supply S)xtem.Each Participant's sharc of su;h annual costs w!11 be net biHcd or credited agahst the bUlings made by BoimeviHe to thc Partldpsnt oa a monthly basis, under iis power sales contract(s).

Each of thc Participants has executed a Nct BZmg Agrecmcnt, as morc fuHy described below, udth thc Supply System aud~vLii.By tbo Nct Billing Apecments, each particlpmt assigns its share ot thc project's capability to Banc>>ville, aad the entL~ou:put of Hie projad<<fH be added to a"d pooled with the other power sou~avxH-aMC to Bo""cvUh smce the Paludpxnts'ayments to thc supply system uUI bc net bUldL the cost of the power pm-duced by thc project wUI be borne by Boaaevile customers.

Bonneville has assured Congress that"day costs or losses to Bonneville under these agreements wUI bc borne by ail BonneviL'c rate pxycrs through rate adju~~~U necessary." THE NET BILLEVC ACREESIENIE o!ccrtaht provisions of thc Nct BZng Agrcemcnts foHows.The fuH text cf tbe form of*greemcats inay be obta:"cd from thc Supply S)xtcnL Thc capimttation o!any wtud or won4 witch is not conventionally capitxHmd (c.g.Pro-'ect Participants) ind!tes that such words are dcfincd In the Nct BiUing Agreements.(The same pracUce Is Mowed in thc sununaries of thc project Agreemcni and the Resolution w~dch foHow.)Term Each Nct BLrfing Agreement became cHcctivc upon<<xecaLoa and delivery and will teruunate on the date that the project Agreement tertminatcs exccp: as protfded in Section 10(c)(sce thc sub@apt!on"Ter~Eon")

and as to accrued obHgxtions ad HabLutles Apxough th: Nct BiHing Agreemea'ts mxy be ter=h:ated pfior to thc matey of any project Bomls, tbe obHgauon o!each of i".P-"cdixmts thereunder to pay its proportionate sharc of de s:rricc oa any project Bonds shaH cont'"uc tmtU the projem Bonds have been rctircd, and Bo""cviL'e will condnue to be obhgatcd to oHsct or credit these payments against payments pumant to thc Pxmci~t'5 BoancviHe Conuac4.Ownership and Op~ca Thc Supply Sys~will usc its best cHorts to arrange for the finxn&g, design, constmctioa, opcmtion'D m4"~ce of th ProwcL 21.

Thc Supply S>stem s<<Hs, and<<aeh Partieipan!

purchases, its Part Yipungs Share of thc Proiect Capabfity and each Pai Jripant h curn assigns its PaiciYi pant's Sharc ot such Capabihty to BonrciiiJe.

Tb~amount of each Pat Jcipan s Shat<<of Project CapaMity is shown h Exhbtt I auached hereto.The purchase price to be paid by each PsrZipant h e ch Contact Year<<iU be t5<<"-oust sperigal Ia thc BiHing Statemem rend:el to thc Pattfripant by thc Supply System.Thc amount of thc BiUing Statemen!is de:ermiccd by meltiplling thc Aursal Budyt or any amended Annual Bud!et by the Partiripant's Share.The Annual Budge!shril provide for CU ot tix-.Supply SIxtem's costs<<ith respect to thc Proje in the Con!ran Year, inchding debt sctsicc.Thc Partiripan!

is obfyA to pay thc Supply Sp'm whether or not th Projec: is completed, operable, or operating snd notuithstandhg i".c suspension, htermption, in!<<rfcrence, rcduefon or curtailmnt of thc Project out'put, and smJc paymerts ac not subject to reduction and are not conditioned upon thc p"fiocmana or nonperto.ance by the Supply System or Bonn<<life or any other Partiripan!

!mdcr thc Net Bifisg Agee~uts or a"y o Jar age<<ment or hsutien'he Participant assiys smI Bonn<<life accepts thc sssiy=.ent of thc PartYiipanc's S5are h con-sidaation of su<<5 sssiymat, BcmnevZ<<sill ofset or credit thc amoun!s pakl by thc Pamcipant to the Supply Sysiem ender thc Nct BQling Agreement agaiss!amounts ouud Bonn<<i!He for po<<er p-rchascd and certain servias rendaed under chc Participant's BonnesiUC Contracts.

Tbis slstem of ofs<<ts and credits is termed'"net Mlisg".Net biUisg<<iQ begh os January I, f977, or thc Date ot Commercial Operation, whichever is earlier, or at some eafiicr d<<tc if th Projec.is tempted puissant to u Project Agree cnt, as herei"after dacnled.Bon"cviQc is obUyced to make the ofsets and credits spewed h t"-Net Billing Agreements whetha or not the Pro;cct is completed, operable, or operating md notuithstandhg thc mp nsios, Imermption, hie!ter<<ms'>

sedation or~nt ot thc Pmjea outFCL Such ofscts amI credits a c noc subject to reduction and are not conditioned upon tbc patormaee or nosperfo!mane<<

by tho Supply Sys!cm or BonnmiUc or any tuba PartYiipant imder thc Na BUling Agecments or any omr age<<ment or hsuu cn'L Psg en!v Each Pa!tiYipant is oMgated to pay M Supply System os a monthly basis its PartiYipant's Sharc of thc Supply S>stem's annual exp<<usa i"<<urred h connection with thc operation ot the Pmjmc.Each month's paymencs<<Jl be based on che amount of ne!bifing credit raeived by the Parficipa<<!

during thc preccdisg,~oath on its Bonn<<vlf<<Mliuy.If thc credits recrived fmm BonneviL'c a:c less t5an the Pai Jripunt's Sharc of expenses for a Contraa Yar, the Par dcipant is nevesh<<I<<ss obhga:ed to pay such Sharc.Bonn iilh has entered in:o ret bHIing ageements<<ith OU of thc Pwcipants in connection

<<i!h&e Supply System's Nu lear Projmts Nos.I md 3 and thc Trojan Project.Pursmnt to thc Nct BiQhg Agmeuwnts, BosrcliHe vriU ofset thc agents it ouvs under thc N<<t Bifing Agreement and aD other n<<t billing age<<men!s<<hieh it inay have in<<feet uiih each Participant ayinit the sum of thc a~uncs that such Participant may ouu BonneviUc for po<<ur and ccrain services, is the proportion tha!!5<<amount spxLid in thc current Billing Siatemert bars to the sum o.the amous!s to b paid by Donne vQI<<under aU su-5 a~~mats for t5at Cent!aa Yrw.Ea:h Net BiHL<<g Ageem:c!proiidcs!hat Bo=>>cviHe aiul the parycipant shaB not enter hm asy age<<mum providing for p ymcnts to thc parfieip=-c by Bormcvilh<<heh Bone<<life es~es vfiU ause the aggeg tc ot Bon"'vZC's biUhy to the Participant to be less than 115 percen!of the Bonne!if c nct bfling obfyficms to thc Pa!ticipant usda aQ agecm-ts pmviding for nct bi'Jing.If Bosnevfie is unaMc to net Ml thc amounts to bc paid to the Supply Slstem because the dofsr ohfyfons duc DonncviHc&om a Parricipant are or arc exp@col to bc hsuKaent to ofsct Donnevifc's defer obUgadiors to such Participant, Bonn<<vlf<<<<iU usc i!s besc efow to arrange tor a voh.nary assiymat of aU or a poruos ot ihe Partiripant's Sharc to thc extent reciutred to eliminate thc htufiriency,~t5e Participant sMI make any such assiymcnt so atraneM.Thc other Paifieipants

<<iJ have thc 5 is!right to aaept such assiym<<nt, pro rais among ihosc exerrising sech right, b<<fore such an asfiy=est is mad m a customer who is not onc of thc Participants.

If BonncvU!c is unable to arrange for such an msiyment, the Participant will make sash asfiyment to thc o Jier Pa!ticipants, who a:c obhgsted to accep!it, pro ra:a, proiidcd that the sum ot such assignmcs!s to a Partiripant sMI not,<<i!hist Its consent, cxcced either 2P~of the ParuYip<<<<t's Sharc ot Project C pabiTiry or Its csfi-a:ed net b Jhcg capability.

If aU or a portion of tbc Pan%pant's Sharc is assigned as described above, the Pardripast viill mme liable to pay the purchase price for its Parttripant's Shac h accordance

<<ith its Nct Billing Age<<ment as if such asiiyment had not been made.Su<<5 li bifty of thc PmYipant will bc disc<rgcd only ta thc extent that ihe assiyec of aU or a portion of the Par eipant's Sharc pays to the Supply System the purchase price for ie Pattieipasps Sharc so ssfiyecL If assiy=eats cannot bc made in amotmts scf cien!to bring hto Mane<<thc respective doiJar oMy-tion of BonreiQI>>and thc Par!Lripant nnd cn accumu'lated Ma<<ce h fsmr of tbc Pardcipant from a previous Cost!aet Year is exp:cted by Bonneiife to be carfied for as additional Contract Year, such Ma"cc snd any s bsetlucnt monthly nct Manccs that cannot bc net bJIed will be paid in cM to thc Par icipant by Bonsai!!e.

subject co the aviilaMity of fed rd appropriatitos for such purpose.Boc"eiiUc has indicated to ih.Supply S>stem and thc Patfiripants that it will pay in<<aih from amounts<<spec:ed to bc aviilable in tke BonncviUC Pouur Admhistraiios Furd asy costs billed thc Pardcipa" ts whic5 arc no!paid through nct bflhg credit (See section entitled"Sccufity for the Bonds.")If BonncliQ<<is unable to satisfy its oMiyths to as sf<<et'ardcipant by nc!bQIing, assigunest or cash payment snd dacrmines that this wfl eonfisuc for a signif cast period, the afated Pa!ticifust may direct that aU or a pordon ot the energy associated with its Participant's Share be dehvcrcd by thc Supply Sp:em for thc Pa<<UYipant's account at a sperifcd point of delivay, either for the expected period of such Lsab Jity or the remainder of thc tenn o!the Ne!Bifisg Agreement, whlchevcr is sperif ed by thc Paitiripant when it<<iects to have such energy delivered to IL The mnount ot energy d<<Uvetcd will be lim:!ed to the amoun!of thc Part Yipanps Sharc for v hich payment by Boc"eiiHc cannot b made.Thc PamYipangs obligation to assign its Participant's Share to Bosncvil'e and Bonnecif c's oh Jgation to make pslxnents to che Participant

<<iU thea be appmpfiately modif OL If the Project is ended pursuant to Seuon 15 ot the Project Age<<ment, as des<<riled below, Supply~:em wfl gvc nofcc of tcrmhafos ol each Nct Bivsg Agecment efectivc vpon the date of termina-tics of iuc Pmjem Agccment.Supply Sys:em shaU thea ter Jn tc aU activities relating to constmctios and operation of the projecc a"d shaU tmdatskc!5e salvage snd dispositios or vJC of lh pro,'ect as provided h the Pro!at Agreement.

After meh!aminaJos, the Supply Six!em wQI make mostldy accousung statements to Bon"evifc and each Participan!

o!aQ costs aseistcd<<ith such te!mhatios.

Thc monthly a<<musing statements will crAi: against surit cos<<z aU a=oun!s reecivcd by csc Supply System from the disposifos ot Pmject asses.Such monthly aceous!hg statcmer!s will con!hue untU aU Projee!Donds arc paid or hsds a:c set aside for such payment.It thc monthly accounting scat<<ments sssw i".a!such ccsts<<xceed sv.5 credits, thc p eficipmt will psy Iu portion of such excess costs to thc Supply Sys!c.ThcpaIvncnts wLiI bc made at times and h<<merits suKcient to discharge os a current bafis thc p.<<dripmt's Sharc ot ise amoum whhh the Supply System Is retiuD<<d to pay hto thc varhus pcovÃA h!'.c Project Bond Resolution for debt service smf aU ois.a purposes.

n' Event ot Dchaiz The Participands Sharc of die Project CapabBity pvMaM by the Parddpaat from thc Supply Syitea and assigned to Bonneidllc will bc autoaatically increased for thc reaairiag tera of J:c Nct BiUing Agreement pro rata with that of other nondefauidng Partiripants J, and to thc extent tha:, one or more of ihe Participants is unab!e, fafs, or refuses for any reason to perform its obligations under its Nct BiU!ag Agreement; provided however, that the sum of such increases for each PatdeipanL u(thout is consent,-aay not exceed aa aceumvlatcd aaxiaua of 25~so of is Participant's Share nor shall any such increase came thc estiaatc of thc pa)mens to be made by thc ParJcipant to thc Supply System to excccd the csdimatc of Bonncvifc's bUlmgs to thc Pare!pant for power and eettain services during thc period of such increase.Particlpant's Rate Coi enant and Sources of Pa)mens No PartiYdipant will bc required to make payments to thc Supply System u>>der is Net BJli"g Agrecmcnt except from revenues Ccrivcd from thc ownership and opczation of is electric utiTity propetdcs and tron payacnis by BonncvLi!c unCer such Ayeement.Tbc Participant coven""ts t5at it viiH esablish.maintaht and cofect rates or charges for power and energy and other seri(res, facilities and coaaodidcs so!d, furrJshed or suppUed by it thrtvagh any of is elec'tric vdf ty propcides which shaU bc adequate to proridc revenues su~w!ent to enable thc patio!pant to aakc thc payaen:s to Supply System puzsuant to is Net BBrng Agreement and to pay Jl cuber charges and obfgations payable from or consditudiag a charge and iiLm upon such zevcnues.htodigeadon of Agreement Thc¹I BLUng Agreements shall not bc amerded, mod!fed or othczwisc changed by agreement of thc parties in any manner that uV'in pair or adversely sfect thc se>>arity afforded by is provbhns for thc payaeut of thc principal, Interest and premium, if any, oa thc~Tbc~~his dcsaibed be!ow arc an integal part of thc Nct BBling Agreeaens.

Exhibit A-A list of thc Participants and their respective Pare!pant's Shares.Exhibit B-Dcserip Jon of the Project.Exhibi<C-Contracaal proviYions rcruired by Satutc or Exccudv Order and reiadng to Contract IVozk hours and sJcty standards, convict labor, equJ opportunity cmpioymeut and thc Interest of a member of Congress.Under thc provisions of Executive Order 11246 of September 24, 1965 and thc Rules and Regulations and rclcvant Orders of the Secretary of Labor thereunder, thc Supply System has b en granted a litnited cxempdon from thc canceUation, termination, and swpensIon provisions,in thc evert of non~mpliancc with the Equal Oppottunity C!ause contahted In thc Net Billing Agreemeas, by the Director, 0!Bcc of Federal Contr ct Compliance, U.S.Deportacnt of Labor.TTIE PROJEC1'GREES~T Tbc Supply System and Bo~ev!Lc have entered into thc Project A~acnL That Agree ent, auto@odicr thhigs, provides standards for thc desi~, liccndng, fnanring, eonsttucdoa, fueli"g, opem Joa and main:enance ot thc Projmt.aad for t-"o aakfa of any zepiiaccmens, repairs or capital adCJdons thereto.A summary of soac of thc prov!duns of thc Protect Ag:cement foUoav.A copy of thc Project Agreement aay be obtained from thc Supply+<ca.Thc Agrceaent bec>>ac cf ccdivc upon is execu doa and dclivay and will tera~to when the Project Is term!ax:cd as provided ia Secdoa IS of thc Agzecacn'ecdon IS provides that thc Project shaU terminate aud thc Supply System shaU cause thc Project to be salvaged, discondnued, dccommissioned and disposed of or so!d ia who!c or in part to thc highest bidder or bidders, or disposed of in such other armer as thc parties may agree when: (a)Supply S)stem determines it is unab!c to construct, operate, or proceed as owner of thc Project dcc to licensing, fnancing, or opcradng condiYior4 or other eauscs which arc beyond is consoL (b)The parties drterminc thc project is not capab!e of producLag energy consis~t with Prudent Utility Practice or, if thc parries disagrcc, thc Project Consulsnt so Crtermines, or (c)Bonucidfc directs thc end of Project pusuant to thc proviYions of Seedon 11(a), which proidde that if thc cstiaatcd cost of a rep!awment or repair or capital addition rcquircd by a gov-emaental agency exceeds 20 percent of the then deprcc!at<<I vaiv of ie proj<<t, BonncvZc aay direct that thc Supply System emf thc PzojccL Des+, Llecmlag and Constzucdon of the Project Tbe Supply S!atem will among ot5er thhtgs (I)perform its dutia and exercise is rig5s ia accordance whh prudent Utvity practice;(ii)tse its bat cforts to obtda aU fumes, perais and other sighs and rema!atory approva!s ne<<ssary for the owneship, eonstzuedon, and operadion of thc Projert;(Bi)cemssuct dm project in accordance w!th prudent Udlity practice;and (iv)wc L's best cforts to schcdulc thc Date of Comaerc!al Operation as~as possib!c to S~'er I, 1977.Bonnewl!c uff usc its best cforts to construct, operate and maiataht thc nccasazy fw'ties to intertonne>>ct t5e Project vdth the Government's trmsa!sion grid so as to bc ready to receive tho Projcrt's gcmadon on or before thc In!dc!tat and operation ot the Proje<<.In thc Project Agreeaer t"Prudent UtB!ty Pracdicc" at a partictdsz time means any of thc pr~methods and acs engaged Ia or approved by a signficant proportion of the elecuic J uddty indusuy ptior to such diae, or any of the pracdces, methods, and acts which, ia the ex risc of zeasonab!c judg-tnent in li Ja of thc facts known at thc dmc thc d<<ds!on was aadc, exld have bccn cxpccted to a<<oa-plish thc desired rcsvh at thc lowest reasonable cost consistent wi3 reliabfi:y, safety and expcdidon.

!n evaluating whether any act or pmposal conforms to Pmdent Udlity Practice, Boancvifc, thc Sapply Sptem and any project Consultant shall take!nto account thc objective to Intcgi tc the cadre pro<<Ca!xtbfity with thc hydroe!ectric resources of thc Fcdcral ColumMa River Power System and to achieve optLawn utJization of thc resources of that system taken as a who', and to ackievc cadent and economical opemtioa of that system.Financing Thc Supp!y System wBI usc is best cfforts to issue and sell project Bonds to!mana ie cost of thc Prcje: and thc coapicdoa thereof, as such cuss arc Ccfned ia the Projec: Bond Resoludon, and to the cost o!aay capitJ add!Cons, rca=uMs, repairs, rcpiimens or medic dens to thc Project;pmv~, however, that s.ch Projsx Bonds may then bc IegaUy issued and sold.A!I pro;<<t Bond Res@'udons arc sub j<<t to appzov J by BzmnariL'e, et EecCc has appmvcd thc Reso!udon and th>>Supernal Reso!udca.

Budgets Construction Budgets and Au"ual Budgets wiH bc prepared an;usHy.'Ihe Construcrioa Budgets and the Annual Budgets ar.d any revision therco!arc to be submitted to BonnevuHc Q are subjc~to its app~ovaL In thc absence of any ob;ecrioa by Bo""cvH!e a budge'.<<Hl become eHccritvc vrithin 30 days, in the case o!the Construcrion aad Annual Budgets, and wiririn 7 days in thc case o!any revision rhrcoL A ruo" thly Conssucrion Budget report shaH bc prepared by thc Supply S>a:cm and 6!cd<<dfh Bounc-viHe sho<<4ng by major p!ant accounts or conLmts, thc cunuiarivc

~ants connitmd and expended to the date o!each su h report.Costs incurred by the Supp!y System in an cnergcney or to protect thc safety o!thc Project or thc public shall be added to the Annual Budget as Inca~.AH saxon'.s shaHbe kept sons to permit conversion to th system of amounts prescribed for e!cwc utiHties by thc Fcde:al Power Connisrioa.

Operatloa and frfaintenaucc Thc Supply SJaten wiH operate and maintah the Project in accordance with Prudent Uppity Prao.tice and thc requirements o!govenmeut agencies having jurisdLrion.

Bonds for Repheemcnts, Repairs and Capkal Additions!I h any Contract Year the amounts in thc Aurual Budget for rene<<Js, reps'nd rephm eats and for capital additions and bettcrnents necessary to achieve design capab!Hty or required by governmental agencies (" Amounts for Extraordinary Costs"), whether or not such mounts are costs of operation or costs of consuucrion, exceed thc mount of reserves, i!any, ma!atained for such purpose pursuant to the Project Bond Reso!utica plus thc proceeds of insurance, if any, avaHab!c by reason of Itns or damage to the Project, by the Inter of: (I)$3,000,000 or (2)an aamunt by which thc amount of BonneviHc's csumatc of Qm total o!thc net billing ercdits avaHab!e in such Coatract Year to thc Parricipants and the amounts of such reserves and Insurance pro wcds, H any, cxcecds~Anaml Budget for such Contran Year exclurive of Amounts for Extnordinaty Costs, Supply System<<1H, ia good faith, usc its best efforts to issue and sell Projen Bonds to psy such cxccss.BouaeviHe's Approval aad Pro~Contain" 1 I!any proposal or item subject to approvaI by BonneviHc is dhapproved by BonrcviHc and an alternative proposal or iten is suggcs'.al by BonneriHe, Supply Sptcm<<Ml either adopt such suggesrioa or,<<(thin seven days after receipt o!such disapproval.

appoint a Pro,:ect Coasuhant acc:ptab!e to BonnevH!c to review thc proposal or iten.Proposals or i:ems found by thc Project Consv!taut to bc consis:cnt

<<4th Prudent Urility Pr nice shaH become immediately c8cctive.Proposals or items found by thc project Consultant to be inconshtcat

<<1th prudent UtHi:y practice shaH bc modi6cd to cordorn to Lhe recomnendauon'f the Project Consu!tan'.

o: as the parries othnwse agm and st become eHecrivc as and when modiHcd.If any proposJ or iten refcrrcd to thc projcn Consultant has not been resolved aad will affect the continuous operation of thc Project, Supply Sys:en shaH conrinue to opento the project and racy proceed<<6th the iten as proposed by Supply System, or as proposed by BonncvU'e, or as nodiScd by mutual agreement o!Supply System and BoawU'c.If thc Supply S)ann pm'6 with the item as proposed by it, and the item is determined by thc Project Consultant to be Inconshtent with Prudent UtHity Practice, Supply System shaH bear a"y nct heretic ia thc cost o!comtruuHon or operarion of thc Projen resu!ring from such item without chary to thc Project to thc exmat such iten is found by thc Project Consultant to bo hcoashtert viith Prudent Utility Practice.Exhibhs'Ihc Exhibits dcseribcd below arc aa fntegr J pnt of thc Project Agreement.

ExhiMt A-Lncriprion of the Project.Ertubit B-Coatrarxuai provisions reunited by Ststate or Exccutivc O<er.Under Qtc pro-virions o!Exccuritve Ord:r 11246 of September 24, 1965 and the Rules and Rcgu!stions and relevant Orders ot the Rcretaty o!Labor thercaade:, thc Supp!y System has been granted a Mited cxenp-uo" Lon the canc!Lsrion, term!" tion, a"d suspnsion provirions in thc eiuat o!nonconpHauce

<<5th thc E4<<J Opportunity Cia sc contahed in said Agrccncnt by thc Director, Once o!Fcdcnl Contract ConpHaccc, U.S.Depart of Labor.DESCRIPTION OF 1975 A BONDS AhD CKRTAN PROVISIO7iS OF TIIE RKSOLUTIO.'f AND SUPPLK3KNTAL RKSOLUIION The foHowing sununary Is a btief outline of certain provis!ons contained in thc Resolution and the Supp!cmental Resolution and is not to bc considered as a fuH statement thereof.This summary is tiusl!6ed by reference to and is subject to thc Rcsolutioa a"d the Supplemental Resolution, copies of<<hich msy bc examined at the principal oiHces of thc Supply System, thc Boad Fund Trustee and thc Payiug Agents for U~!975 A Bonds.Tho Bonds aad the 1975 A Bonds Thc Resolutloa creates anI es:abHshes an issue o!Bonds of the Supply System which may be issued frtxvt rinc to time to pay the ht of Conaruction of thc Project and to establish reserves as thcrcht proridcd.Thc 1975 A Bonds arc pat of such issue.'Ihc 197S A Bonds<<ill be dated March.1, 1975;principsl and sen!-annual Interest (January I a%July I)on coupon 197$A Bonds aad prhxdpal oa registered 1975 A Btnds wHl bc payablc at the option of thc ho!der rd Sc tt!c.past)lational Bank, Scaulc,'tVashington, Conrinental Blinois Jfarional Bank and Trust Company of Chica@>, Chicago, IH:"ois, anl Thc Bank of New York,?(cw York, hew York.Payment o!Interest on fully rcystered btnds will be mad-by Conrincnt J Bliuois National Bank and Trust Conpau>of Chicago, Chi:a~m, 11Hnoh, which has been appointed the Bond Fund Trustee.Thc deHniYin 1975 A Bonds will bc issued in coupon foun Lu the denonuastion of$5,000, registr ble as to principal only, and in fully registered fo:m in thc denomination of$5,000 or any muluplc thereoL Coupon 197$A Bonds and fuHy registered 1975 A Boads are iatcrchaugcab!

c.Thc 1975 A Bonds<<%nanm in the yean aud amounts and bear interest at the rates pcr anrun shown on thc cover page hercoL Thc 197S A Boers n turing on July I, 1999 and July I, 2012 viitl have thc beneHt o!a Bond Retimncnt Account to operate at the times and h thc amounts sct forth bJow.(Rcs.Secs, 4.5 4.7'upp.kes.'cc.2).Rrdrmprionr

'Ihe 1975 A Bonds wiH bc subject to rcdcmpritoa prior to maturity at the optioa of thc Supply S)iten on and~Jtcr July I, 19SS, oa at least 30 days'ublished notice, ia who!c at any tine, 27 or ia pxrt on any iatcrest px>m:nt da:c in inverse order of their mxturities and by lot within a maturity, at thc respective rcdemptioa prices (expressed as pereeatages ot thc priacipal amount)set forth below, together with accrued interest to~ds:c fixed for redcmprioa:

Feetoa Dvetna'athlete ReChkeoect (aoue Deice loetvctec)

Jvfy I, 19SS to June 30, 1990.July I, 1990 to Juae 30, 1995.July I, 1995 to June 30, 2000.July I, 2000 and themafter Rceecvpuoa Meek 103~to..'102 101 100 Sfnling Fiend Jnrrdlmrrasr The 1975 A Boads duc July I, 1999 are to be retired by mabtoty xi JeL>>g fumI hstxl!ments aceumu!ated ia the Bond Redremcnt Account La th Bemd Fund ia amcemts rZeient m rcdcem oa Jidy I of each year, at ie prinefpJ a ouat thereof, the pt<<cipJ a-o"-t of suJt Bomfs spcBet for each of thc years shown be!owe 1995 1996 1997 1998 1999 Xeeovet 82,595,000 2,775,000 2,970,000 3,205,000 3,455,000 Thc 1975 A Bonds duc July I, 2012 arc to bc rcrired by mandatory sinhhg fund Installments ao.cumulated ia thc Boad Rett cmcnt Acoouat ia the Bemd Ftmd m maounts sufiicient to rcdecm oa July I of each>var, at thc p>>neip J amour t thereof, thc principal amouat of such Boads speeiccd for earit of the yearn~cwn be!ow'cu 2000.......2001.......2002.......2003.......2005.......2006.......Aieevett 83,635,000 4,005,000 4,320,000 4,570,0GO 4,975,MO 5,340,000 5,755,0GO 28 Ycce 2007.......2008...i...2009.......2010.......2011.......2012.......86,245,000 6,690,000 7 210,000 7,805,GOO 8.390,0GO 9,060,000'Ihe Supply S>>>tern further reserves th right to redeem prior to ma'.urity, oa at least 30 ds>>>'ublished notice, (a)the 1975 A Boads taaturing on July I, 1999 and on July I, 2012, in port on any Interest pa>ment date on and after January I, 1995 and on and aher January I, 2000.respectively, upon paymeat of the prheipxI amouat thereof fmm rinhag fuad hsmLements as dcscrbcd behw ard (b)th: 1975 A Boads maturiag oa July I, 2012 in part oa aay i>>tercst pa>ment dhtc oa and ahcr July I, 1983 upoa payment of 1019vo 8of thc prineipal amon"t thereof, from excess comtruerioa fund proceeds, ia each case together vdth accrued iaierest to the date fixed for redempfion.

'Ihe Supply S>>>tern aho reserves thc right to redeem the 1975 A Bonds at aay t: c prior to msmrity, on at!cast 30 days'ublished notice, in whole at aay time, or L>>part in inverse order of their maturities aad by lot wit%in a niaturity, on any in'!crest pays:nt date, from promds received from the saic or disposition of property or h thc cvcnt the Project is terminated as provcJed in thc Project Agreement, upon pa>>>neat of thc prineipal amount thereof together<<fth acemA interest to thc d tc fixed tor rcdempfioa.(Res.Sec.5.3;Supp.Res.Sc" 3).Tbc inhag fu"d instx!!meats for thc 1975 A Bus duc July I, 1999 and duc July I, 2012 may bc appficd to the reden:ptioa of such Bends oa July I of exch of thc above ymrs or oa th=immcdhtely precedhg Jaa~p!.(Supp.Res.Scc.2).Subsequent Serics of Bonds Thc Supply System covenants to issue adehitfonal series of Bonds to thc cxte" t required to pxy the Cost ot Coarrucfiioa of the Project aad to estabfish the rcscrvcs required by the Reso!ufion to thc extent such reserves atc not funded from other sources.Such Bonds may be issued upoa comp!ianee v(tb the fol!owing prineipaI conditions: (I)There shall have bcca delivered to thc Srpply 8>>>:em a certificatc of the Bemd Fuad Trmiec that rAe default exists h tie px>ment of priaeipsI and interest oa any o tstanding Bond, mid there hss Inca iLlivered to the Boml Furl Tr s:ec a ecrfifieatc of the Secretary of the Box:d of D'ctors of tice Supply S>>>tem that the het Billiag Agrcemcats aad Project Agreement arc ln fuII farce a"d efiect and have not brea amend>>I h aay maser adverse!y a!1cctiag the Supply System and thc hex'derx o'hc Bonds (2)Such Bonds shall be either serial or term bonds or a comb~fion thereof, with thc final maturity date to be July 1,2012.(3)Tl:c Construction Engineer shall certify es to thc amount expended for, M the amount remaining avxihb!e to pay, Cost of Constr ction aad thc times funds will bc rcquircd to pay such Cost, aad, if thc crtLmxtcd Cort of Coasttuction hxs htercxsed, give a statement of thc rcasoas for such Inmate.(Res.Rc.3.4).Addificnal Indcbtcdcess Other than Bonds Thc Supp!y S>>>tern may aho Issue addition bonds ranhag on a durity with thc Boads and secured by an equal charge and lien on thc revenues of the Project ("addition boads")for thc folio<<>>ng purposes: (I)to comply<<(th aa order of aay goiur~catxl agency<<ith authority to Issue, m Jc or enforce an order or derision requL>>ag thc iastJhtioa of addifioaal cities or modifications at or tn the Prelect'2) to comply v(th requiremeats of thc Project Agreement for thc Issuance of additioaal bonds (sec"Bonds for Rephcea:eats, Repairs and Capital AddiYions" under"Project Agrcc menf above)i (3)to refund at aay time any Bonds or adehifionsI bonds.The Supply S>>>tern may not issue any additional bonds unless prior to or shnultaneousiy with the issuance of such bonds the Supply S>>>tcm has h effect valid wriiten contracts for the sale ot capxbihi:y, po<<vr and energy of thc Projem<<hich, ia thc opinion of the Supply S>>>tern and o!thc Consuhing Engineer to th Supply S>>>tern,<<iII pwduec res>>nues at least sufiicient to cnxb!c thc Supply S>>>tern to meet J!of its obHgarions under t"e Resolution.

Such contmcts (I)mmt bc for terms extending at L st to the finxl maturity date of thc Boads, (2)un!css such contracts are with thc p">>les to the Net Bfilhig Agreements, must bc<<'.th purchasers which, L>>thc opirdon of tI~Consulting Engineer, have the ability aad fiaancial respoasiYitity to meet their obligaiions under such eontmets, and (3)roust coat ia terms with respect to payments for project cxpxbL'ity, power a"d energy and thc items of annual power costs to bc included h thc pric for such project capability, power and energy which arc not less favomble to thc Supply System than thc terms of thc Net BilLiag Agreements.

AafioaJ bonds may bc either scrixl cr term bonds or a combination thereof, with thc finxI mxt riO date to be July I, 2012, or If thc servtm lite of thc f~Yies being fiaxnecd cxtccA beyond July I, 2012, a later date which is not Inter than thc expmrioa of such service Ufe.A separate bmd fM Is to bc crea:ed and pa>vuents iato such bond fund for thc re&ement of such additional boA aro to commence<<dna 5>vam from thc date thereof or, ia th-ease of refunding bo"ds, at is t e when p>xnents with respea to thc reticent of thc refunded Bonds or addftloasI bonds<<xtuld be tequired if such BoaA or additional bonds werc not refunded.From the procecA of sale of aAUrio&bonds or rcvraues of thc Supply System avaUsb!c at the time of issuance;aa amouat equal to i<<e mai-mma amount of interest to become dce oa such bonds ia any six-moaih period is io bc deposi:ed in thc rcscrve account h such bond fund, nnd such account is to be mrintafned ai such amount;pmdded thai such amount, ia thc ease of refunding bonds, may be so deposited at the Umc whca ihe refunded Bo" ds or additional bords are no longer deemed outstandhsg.(Res.Sec.9.6).Construction Fuad;AppUeatioa of Bond Proceeds Thc Raolurioa atabUshes a tVasfrington Public Power Supply SystemÃuc!ear Project Ntx 2 Construction Fuad (the Construction Fuad")and a Construction lntcrat Account smI Fuel Accou"t thercia, to be held by the Construction Fund Trustee.Continental Ulinob Ban'k and Trust Co pany of Chiago Is Construerion Fund Trustee under the Raolu Don.Thc proc cds of sale of thc 1975 A Btmds<<K bc appled as foUo<<a: (a)An amount equal to thc iatercs'.on thc 1975 A Bonds from thei: date to Sepulcher I, 1977, wiU be acdiied to the Constr crion Interat Accouat ia the Gmsttucrioa Fund.(Thc ia:crest to September I, 1977 oa thc Boads heretofore issued<<as capitaUxed from thc proceeA of such Bonds.)(b)Thc sum of$2,382,000<<UI be credited to the Furi Account in ihc Constrt<on M.(c)Thc balance of 1975 A Bead pmcecds wiU bc dqesited ia the Conti~on Ftmti The proceeA of sale of subsequeat series of Bonds will be appled as foUowst (a)An amount equal to the Interest oa stsrit Boads to Scptemb:r I, 1977, wUI be cicdiM to tho Coasuucrioa Interest Account ia the Constructioa Funti (b)Thc Supply S>stem<

atcm determines (c)Thc balaaec of thc Bond pioceeA wUI be deposited In thc Comtrucrion Fund.'Ihe Resolutioa provides that ri wor&g apital and the Res:rvc Account and Reservu tmd Con-ringency Fund requi:emend are not provided for by Sep:ember I, 1977, thnegh revenues recrived pursuant to m Net BiUiag Agreements, rich amounts will be provided from Bond proceeds.hfone>a ia the Comttucrion Fu=d are to be us<to psy Cost of Consmtctfon of thc projat, wh'.ch hcludes costs of contracting amI acquiYig the project, ob:iYing pernrits aad Uceases ad~tri."~Foperty a d Fue4 trustea'nd pa>1ng agnus'ees, taxes""d hsumnec.pre 'tmts, the cost of en~Ing services awI a Yidstrarivc A oveihad expel of the Supply S>stem cUocab4 to th~~irsirion a"d constiucrion of the Projec'hc cost o!acquiYi"g Fuel<<(U bc pidtd from i".e Fud Asxr<L bfonc>w ia isc Comtmerion In'.aat Account in the Consttucrion Fu"d<<fU bc md to pay fntm oa thc DonA to September I~1977.Whenever mon~ia the Constmctfoa Ia:crest Account are Inade-quate to meet Llierest paymc ts, amounts necassry'to meet tho degricncy arc to be iam.ettwI from thc Comuuerion Fimd to thc Consign.'on ln:rest Accouai.'Ihe Resoiutfoa Prescribe cerirda Procedura desifv.cd to safe@:M Ps>eats or traas!crs from ihc Coasttucrion Fum4 h ImUng,~~othas, cerri6cstcs by ihc Constr erioa Enghea~a dctsUcd Itcmira"'on by the Supply System of ihe amounts to bc paid and thc p~qecs thaeoi>done>a rem&lug ia 8e Construction Fund after payment of aU Cost of Consttucrion and dier ieqtrired pa>mene, if any, to th Revenue Ford, Reserve Acco""i and to thc Reserve and Cortiagency Fund are to bc tr&eiicd to the Bond Re&smear Account.(Ra Sxs.6.8-6.13, 7.1;Supp.Ra.Sec 5).Other Funds BstsbUshed by the Resolutfonl Hoir of Revenues Thc Rcsoiutioa aho estabthhcs a washington Public Povar Supply S>atem I'uciai Project Nrx 2 Rcvcruc Fund, Bond Fund (induding an Intcrcst Account, a Principal Account, a Bond Retirement Account and a Reserve Account), Fuel Fund and Rescrvc and Contingency Fund.AU such funds are to bc held by the Supply S>stem, except for the Bond Fund, which is to bc held by thc Bond Fund Trustee.Revrnuc Fund: Thc gross rcvcnues derived by thc Supply System from its o<<xtership and operarioa of thc Project arc to bc paid into the Revenue Fund.hfone>a receisvd prior to September I~1977~or thc Date of Commen:i'll Operarion,<<hichever is earlier, under thc Yet IULhg Agilmente will bc eietUted to a Preps>ment Account in the Rcvcnuc Fund.BonncviUc ami the Supply S>stem have ag~ed that if tbc Project docs not commence commerrial operstioa prior to September I, 1977, aa amount at last equal to onc-M'f the maximum annual iniercst oa thc Bonds issued prior to Scpte ba I, 1977, p!us$6,000.000<<fU bc Mured in ihc Amtu I Budget for ie project for thc perhd Ianna T I to Sep'.ember I, 1977.Such amount<<9d bc credited to thc Preps>ment Account ard used, Urs4 to deposit ia thc Bo."d Fuad for credit to thc Reserve Account, the amount required to arabs such Account ia thc amount requhcd by thc Resoiutioa; soignd, to deposit$3,000,000 in the Resavc c" d CortLngency Fund a9, Curd, to provhic$3,000000 for worldng apiml for the Proj:ct.Addftvmai<<or>lng capital may be proridcd by mutual agrccmcnt between thc Supply S>xtem aV BoancvUlc. hfoneys ia tbc Revenuo Frnd az to be ad for thc purpose of mahng required pa><<tens into thc Bond Fund and nny speciri funds for add fdonri bo."S,, paying for thc costs of operaring and mainiaining the Projea, maiing required pa>xucnts ir:.o thc Foci Fuad and thc Reserve aad Co" iingency Fund, mahng repairs, renewals, replace-ments, additions, beuerments and i.provements to, and cxtensioas of, thc Project, ad pa>fng cU othe.chsiga or obUgrdons agains such revert'ues (Ra.Sec.6.1).Bond Fund: Fnxn thc gross rcvcaves therctoforo pad into the Revenue Fund, thc Supply Sptcm B to pay monthly into thc Bond Fund, for the credit of thc Interest Account and the Principal Account, rcspecrivxdly, Sxed amounts sufhcient ia the aggregate to pay the principal of md httcrest'on the BonA as th: same bcc."mc dne and pa>able.Pa>taenia to the Intciat Account will commence on September 25, 1977.prior to that date thc Commtctfon Fund Trustcc wUI transfer from thc Constrcctfoa Fund to ic Bond Fend Trustee amounts sufUricnt to pay each InuaUmcnt of interest oa i".e Bonds.Mceisdy p>incurs to thc principsl Account arc to commence not hier thsa Somber 25, 1977, and bc rrScf eat to pay outsing serial Bonds as they mature.Bey@mug Jdy 25, 1994, the Supply S>%em is also obUgatcd to pay monthly into the Bond.Re:ima:ent Account amounts sMaent in Qe aggrcgatc to sedan thc 1975 A Boads mmuring July I, 1999 and My I, 2012 in ihe prinripri amoums and ai thc tiaa speciced under the subcaprioa"Siaiing Frnd Insmlhuents" under"Thc Do"ds and thc 1975 A Bonds".Such amounts arc ia adUtioa to the amounts required or to be required to bo paid into the Bond Retirement Account to redeem the terns bonds of o:her scria of BonA in t."~prineipaI amounts and at the tines spcciged La the resolutions auritoriring such Bonds.hfone>a ia the Died Rerirement Accoimt arc to bc appUcd by tLe Bond Fund Trustee to thc purchase or redcmprion of outrig Bonds.Thcrc is required to bc prid into and msmtrincd ia thc Reserve Account for ecch serie of Bonds outstanding. an n=ouni equal to thc largest amouni of interest on such Bonds during any sh mosS period from ihe d":>>of such BonA to thc Ensl maturity date thereof.By Scp:ember I, 1977, or thc Da:e of Commerciri Oper"tion, wh>chcvcr B emi:r, the Supply System wUI dcporit m rcqtercd amount 31 lv t'C Ah cro I l t'CtitNS Cj CCA AALIA sav Nv y mN CO atr 0 Rat trav(WiM I 5 CCvrlllll 5 Ct tUt'rraa t(0rO SEE INSET cscal vL"~iV jy I 1(111 CO tts tOST-ta (0 tm svrvar)Q Cv.(C a(i&i'rt r I au'a 5Q~10 0'la"P-'hva'g~~il 0 11 AA a y I i..OOO<h(as.VQXHIL Cospststivas OAO MVSUsll)~rr~C v.I'..-.-~-i'I (iplc Irl'I~I j I'a I L I~vvavaaav Cstcttas stA'till svt55IOV 515'CCU ttssilllr l,tsrl LON rCOCNAL IVC(cll tOUCN tLANT Q NON s(0(llt./055l.ti'CL tONCA tLANT(COALI Mvthiatpsl tiss OONQ IW~aalELECTRIC UTILITY PARTICIPANTS SERVICE AREAS NUCLEAR PROJECT NO cs Woshlnp(on Pub((c Power Supply Sys(em a($1 OIC'h (1CC Lar ct'illa'0 trt Sh Vill cj hr.V 1 Vl L L C iliCV Cl(C.~I (Clair 0 Cs.1Y, C(ht sat OAAOOI, aaasv'~NV~1 ta raa C~~t'c.Pgrt till ,.,-.0~(K.V.a I iv-!-'rl.r...... Va l r'at~('tr I:0 tg, v 1+AQv~r~assr>>Q Wa Ii h CtC(qvaa r~r r)at 1trC 0 h i r cjr aavlail Ct tit(.cjsr vNa>>a I I I aar(r O~..YSY I OnEIGOi'I 1 Y>>N R Y l(I)Z~V--/aa~r atua~(tc(.tstr. 0--'t alai 0 vllt000 lail'VLUI>>Otc 1 S(5(NVMION ~CNT N Covltr GPSS NO.E L 4~ittss a(tt I~I Nv'll 1st F a Agva(5'1 gE.Tw ,I NAIL Ct((.tstr tatL stall L l/rr.(i'lr--a a I C I., L~~AY IL I rv'r vaaaa I I list lti(l 050:5(K'hctcc.cJtr,~v T a'r I I I I-1 I jO c<j+tohUO.ALCS (tpcs vltlll r I (--,0=:-I I I t-I Krh u VINIOOAA rtua O 0(CLO A raN'ACT~.5'a I.lt tl a.atr~ah>lsf'ta K'-1st A~Av~~n~al.ca)I(IVG I 5 g~lt~I.L I ah)1 1 I I l(d I (~Irt arts tali ti(c csm I'il I)A II 0~.v.~Ila aaa avaaaaal~~Vv Ir V~~v rar K-C ra ia the Resene Accouat dther frau Bond proceeds or amouats rccdwd under the Net BZLng Agree-meats and deposited in thc Prepa>vnent Account.The Supply S>x!em B requi ed to msiatch t!ic required amount in the Reserve Account at aB rimes thereof!a by addiYional pa>men!s from ihc Rcicnuc Fund..lf any Bonds are issued after September 1~1977, or thc Date of Co.~ere!a! Opemtion, whi;hcvcr Is carlicr, thc additiorial amotmt required to bc deposited in the Reserve'Account shaB bc deposited thereia from Bond proceeds or rcvcnucs availab!c therefor at the rimc of issuance of thc Brads.(Rcs.&6.2).Fusf Funds Beghniag oa the Date of Commesdsl Operation, aB pa>ments for Fuel<<iB be made I!om thc Foci Fund.After the Date of Commercial Opcrarioa, after tqshag the required paya~mrs ia!o tho Bond Fund aad hto aay sepamtc bond hnd fos addi&mal bmds and after pa>ing 6=~~ab!c and necessity costs of opcratiag and msh~g thc Proj~hehdiag taxes or pa>meats ia Leu thmoL tho Supply S><<tern wiB uaasfcr to thc Fud Fu"d tbc foBo<<hg amour!(I)thc amount iadwfuf h the Annud Budget for Fuel, (2)aB amounts rcccivcd as Fud csedit, hdudhg thc proceeds of thc use of Fuel.mid (3)any additioasl amouats accessary to avoid a dcgdency ia the Fuel Fun*(Rcs.Sec.6A).0 Reserve or3 Contingency Funds On os before S ptembcr 1, 1977, os!he Date ot Co~erdel Opetatioa, whichever occurs earlier, ie Supply System wB!deposit ia thc Reserve and Coathgeacy Fuad thc sum of 53,000,000 from th Preps>men! Account, or, to thc exicat such moneys arc not available', from Bond psoeeeds.Ia September 1977, and in each moath thercd:cr, thc Supply S>x:em ls required to psy out of the Revenue Fund hto the Resma ard Gmticgency Fund, aft: r ma!ring the requi:ed pa>meats iaio thc Bond&md, any separate b.nd fupd cs!abhhcd for additional boW aad tho Foci Fund, aad after paying or mahag provision fos pk>xaent of thc reasoaable aad ngesury cost of operatiag mid mahtainhg the Piojea, an amouat equal to 10%of the aggregate of the amounts requLed to be paid durhg such monrit h!o thc Intc~Props!amI Bond Rcrirement Acckaa!s in tbc Boad Fund and into any spcoU hads for htemst, priMipJ a"-d bo"-d rctLcments ia sespect of addi-noaal bo~hioncys m thc Rescrvc and Conringeacy Fimd are!eqtrised to bc used to male vp d ac!caries h thc Bond Fund or in any bond funds established for addiYional boads for which fucds arc not availab!e, rcspeaively, ia thc Coastruaioa Fund or Reserve AIumuat or ia thc const!action fund or reserve aeco~~h respect of addirioas! boads.To the extent not rcqvcrcd for aay svch degdeng, moneys ia thc Rescrvc and Contingeacy Fund msy bc used after the Dine of Commcschl Operation fos any onc or morc of thc foL'o<<iag pu!pnsm: (i)to pay the cost of renavals, rephaunents and normal Mucus to awf exteasioas of the Project;and (ii)to pay extrao:dhasy operauoa amf mahteaanec costs, hdudiag cxtrsor&sy cols ot Fuel and the cost of prcwathg or cosseahg any unusud loss or damage (hciudhg majos repsL>)to thc Project.(Res.Sec.6d).fnvesimrnr of Furst Thc term"laws!ment Securirics" means (i)direct obggstioas of, or obligs-rions guaranteed by, the United Stem of Amerim;(ii)general ob!igatioa beds of any stat=of thc Udted Staics ra:8 by a narionaBy seaigsused bond ratiag agency h ehher o!!h>>two ldghcst rating eategorics assigned by such rathg agcacy;(Bi)bonds, debenmra, no!ca or parricip-rion ee!rigea:cs hsued by thc Ban!s for Cooperatives, the Federal htermetBate Credit Bane, thc Fedeta!Home Loan BaaL S>stems thc Bxport-impoa Bsnfs of t" Uaitcd Staies.Federal Land Bsnfs or thc Fedacl Nsrionsi Mortgage Assoeiktha or of aay agency of thc Uai!ed Statm or cf any coTosarioa whoBy owed by thc Ud!ed States;(iv)pabBn Htmshg Boads or psojea Notes sea..ed by contmas<<ith thc Uched 5'-':cs or an agcy thaeof;aml (v)tLnc dcpkrits aad earigmtcs of d~t of any membc: of the Forest Rcsavc 32!~Sptem authormd to dk busiaess in thc S:etc of Washh~on, nct cxcecdiag 259o of thc capital stocL cad surp!us of such member.Moneys in thc Rcvcnuc Fund not requLM for Immediate disbutscmert arc!o bc hvested h Iavestmen! Scocrihies described ia dsuses (i)through (iv)above maturiag or sedeemsb!e at or prior to thc estimaied time for the diibuisemeat o!such mone>v.Moneys in the Interesi Account, Principal Account and Bond Retirement Account are to be invcs!ed in Invcstmeni Seauities described ia chuscs (i)through (iv)above matuiiag not hter than 2 ihys prior to thc rcspecrivc dsws whea such moray will be required for thc purposes intended.hfoaga h the Reserve Accouat co: reqirired fos Itn edis!e disbursement ate to bc invested ia investment Securitics described ln dauscs (i)through (iv)above msturiag or redmnsblc<<ithia 7>ears from thc date of iavestment. hfoaeys h thc Fud Fund A Ress!ac aad Conringency Fund not requi<for immcdix!c d!sbu!scient arc to be iniested ia lavesunent Seeuriries mamiing os redeunsbie wiKn 2>u=s mid 7 yeas, rcspectiwly, from thc date of iavesunent. hfoaeys h tbc Constrrcriioa Fuad arc to bc hwued by ve Construction Fuad Trus;ec in lnvesnaent Rcuriries restating or rcdccmab!e <<iithin 5 ym!s of tss date of iawstmenL (Rcs.5~61 67)Excess!!for~sr Prior to Sep!ember 1, 1977 or thc Date of Commetdd Operation, whichever is earlier, excess moneys (as hereindter degned)ia the Reserve Aeeotmt and thc Reserve and Coa!ingcncy Fund shsB bc paid into the Construction Ftmd.hfonc>a aad the value of Inwstmeat SecuriYia h thc Rcscrvc Accourt ia excess of the aa.ounts requited to bc mahtehed h tie Reserve Account con-siitute"excess moneys" in respect of such Account;mone>a aad thc value of Invesnncnt Securirics in thc Resave and Contiageacy Fuad in excess of$3,000,000 pius the commit eats or obligations h~sred by or the rcquuements of thc Supply System for any of thc purposes for whhh thc Rcscrve and Coatiagcacy Fuad may bc usa!consritute"cxccss n:on ys" in respect of such Fund.If as of aay June 30 foBo<<iag September I, 1977 or thc Date of~aria!Opersrioa,<<hhhcwr Is earlier, exes morc>s exist ia the Resesve and ConCiagency Fimd or thc Rcs:rvc Acokunt, suds inoncys shaB bc ps!d as foBo<<a!(a)excess mone><<in thc Rcservc nd Conringency Fund shdl be pdd ptoporrionstely hto thc Reserve Acocnt and thc reserve~unt for aay serics of addiriscal boads to thc extent of any dcgriency the!cia, and the balance of such excess moneys shall bc paid hto thc Rewnuc Fund;and (b)excess mone>a cxhriag h thc Rescrvo Account shall bc pdd proporilona!ely inm thc resavc account for any series of additional bonds to thc extent of any dcQchncy therein, and thc balance of such cxccss moreys shaB be pdd into the Revenue Fuad.If as of aay Junc 30 foL'owi g September I, 1977 or thc Date of Commouid Op;.athn, whichever is cs!Ber, there shsB exist ia thc Revcnuc Fund, after g!viag of!ca to any LMer of excess moneys from thc Res~Account aad thc Rose!v" and Conthge cy Fund tk such Fuad, m amo"t which execcds thc Supply S>wcm's requi:ed amount of wnfring capital, the amo'"t ot such cxeas fs to b.ppBed to reduce annual power costs micr the Net BilBag Agecaents. Thc"rcqdsed amcun!of<<vuUag mpit~Z s'ha!1 be 53,000,000 or such lasa amoun: (not Lss~$2.000000)or such greater amourt as may be dedded vpoa by thc Supply S>atcm aad Bo~wZ-<<5th thc approval of u Coa-sulthg Engheer.In addirioa, if the Supply S>x'-m ard Bo~vBI ag!ee, aB or any pan of such cxecss over requhed wos>1ng capi!al may bc applied to thc ma!riag of repdrs, rencwm, replacements, sddirions, bettesments aad hnprovcmcnts to, and extcasions of, thc Project, thc purchase or redemprion of Bonds, or for other purposes h co""cc:oa with the project.(Rcs.Secs.6.2, 6.5, 6.6).Catsia covenant of thc S Trp!y S>vmm whh thc hcMem of tbs Bcmds smd thc bottle!s of add!km]boA ao~d xs flows: 33 The Project!'Ibe Supply S>>>tcm<<iU, subject to thc Projca A@cement, comp!em consttverioa of thc Projea at thc earliest pmcricab!c rime, operate th Projca efficientiy and at rcasonsb!c cost, mrna thc Project ia good condiuon a"d comply at aU times<<'.th the terms of aay licenses for t5 Project.(Res.Sec.9.1).Rvicsr The Supply S>>>tern<<1U Cisposc of aU capabUity of avd power and energy from t5c Project solely for thc bcne5t and a~ant of the Project ard pe suan: to thc proiirioas of thc>!et Billing Agree-ats: aad the Supply S>>>tern sill maintain and collect rates aad charges for capsbBity, power and eaergy and other services, facu'itics aad conunodiiies sold, furnished or supplied through thc Project,<<hich wUI be adetiustc,<<bethe!or not the generatioa or travsmissioa ol po<<vr by ihe Project is smpendcd, inter-rupted or rcduccd for any reason<<hatcver, to proiidc revenues svQ!cient~antong other thittgs, (i)to pay the expenses of operating and maintainiag ihe Project, (ii>to nuke thc reriuircd payments into ihc Bond Fund and any special hads for additional bonds, and (iJ)to make thc rc!',vrrcd pa>xenx iato thc Pv J Fuad and Rescrvc and Conthgency Fund.(Rcs.Secs.9."-,9.3). Ncr Bi!Erg>Igrremrrus vrd Project>fgrrcme>>rr Thc Supply S>>>:em<<iU not cement voluntaBy to any amcndmeat or rescission of the Projea Agreemeat or thc Xa BBUng Agrccmevts or take aay action under or h uenecriion <<ith such agreements wMch will reduce t5c ps>ments pnsvMCC for Wreia or which viU in any manner Lnpah'r advescly afiea thc rights of the Supply S>>>tem or of m bovdhoMes.(Rcs.Sec.9A).DI!posfrk>>> o/Prop!>>i!sr The Svpp!y S>>>tem will vot seU, mortgage, lease or otetwise dispose of any properrics of thc Project u Jess (a)sinml:aneous prosisioa is made for the rc J:em!at ia fvU of the Bonds and any addiYumaI btuds or (b)the piopewa to bc!L>>posul of are tmserviceable, insdeip:ate. obso!eie or no longer re!la!rcd for usc in coanecriioa with thc Project, in wMch case$50,000 of thc raone>>>received therefor are to be traasferrcd to the Rese~and Conthgency Fund~M thc balance Is to be paid proport!onatcly hto thc Bond Refirement Account and bond retircmcnt aueunts created for additional bonds, unless such disposition is in connection with thc replacement of such prop riies or thc disporirion ol Fuel, ia which case all moneys received from such!UspcsiYioa are to bc traasfcrrcd to thc Rescrsv md Contingency Fund or thc Fvcl Paul, rcspcrrivcly, or (c)th tramfer of such pfopc cs h w c ropctries ia whole or ia p"-c is by operariion of hw, ia wh."h use moac>>>reccivcd therefor arc to bc paid proporrioaately into thc Boad ReJrcmeat Accouat md bond rcti:emag~ts for addiriomI boa ds.(Res.Scc.9.7).'>>rurcrzcr The Supp!y S>>>tern<<iU keep the Project insured, to the extent such hsurace is avaB-b!at reasonable cost: agahst rish of Cirect ph>>>imI Ios, damage to, or Cestruaion oL the Project, at least to the extent that simBa: insurance is usually arriuI by private utiTity corporariions opera Jng'rop"rues, and agchst accidents, casvaives or negligence, L>>eluding liabBity insuravu and empIo>vr's lisbiTity. Ia thc eveat!>hat any loss or damage to the propettLes of thc proj:ct oecvs during the period ot coastrucriion thc Supply S>>>tern is to transfer the iasurwee Iroucds, if any, in respect of such loss or damage to the Constructioa Fund;any iasutancc proceeCs received by thc Supply S>>>tern ia rcspeci of such loss or damage oi>>irring thereafter arc to be transferred L>>to ihe Reserve avd Continger y Fund or ia thc case of iasuraace covering loss or damage to Fuel, to th Fuel Fund.(Res.St@.9.5).Bookr oj>fccou>>rr'Thc Supply System<<ill keep proper booh cf ceovmt, showing the project ax a scparaic utility s>'stan, ia accoulxncc with thc rules and regni&>M of tk~Divishn of>dvniYiipal Cor-r"~s of thc State Aturtu's officc of the State ol tVa~gtoa aad ia auottLm<<ith thc Un orn S>>>tem ot Accounts prescr>oui by thc Ped-al Power C-m=brion. Su-" boch of auovnt-e to I e a~ad!ted a""vtly by a 5>>n of hdepc"-Cent cerrified pub Jc uu>r":ants of nsrioasl!cpu>rion.Bond-ho!Ces may obeah copies of m""uxl~ca!smtc~ts sho<<hg th fiaancixI condirioa of th: projca and thc anna~J a" Cit rcport by acme a writtca revivcst therefor to the Supply S>>>mm.(ILs.Sc 9.9).34 Corsulu>>g E>>girarrr Tbc Supply S>>>tern<<iU rctaia a natioaxUy recoy8zed hdependcnt-conufit-ing eau~!or eng'"ecriag firm to render conthvuts engineering couasel h thc operatioa ot the Pro~Ia addi!ha to his other dr.'ics, thc Consvlthg Engi"ccr shaU prepare, noi hter than 18 moa>Jts a:a the Date of Convvzrciai operation~and each 3 yeas thereafter, a report based upon a survey of thc Projca""d tk opctstioa aad msiatenaace thcsoL Each report is to show, among other!Mugs, whctha thc Supply S>>>tern has sarisfaaorBy peifoiv:.cd and compRd with certah covenants h thc Rcsoiutiom The CoasvJting En!lacer is abo revivircd to rcport to the Bord Fund Trustee a" d thc Supply 5>>>:cm upoa t!ic economic soundass and feasibility o!aU coatemplived rene<<vis, rep!aeemcnts, addi Jons, britcrmcnts and improvements to, and extcnshas of, the Projea iavo!ving the expenditure of$100,000 or morc.Thc Consulting Engheer is also required to 5!e aanuaUy a ceitificate <<ith the Boad Fund T!vs~dcscribi"g the irsuraaoe then in cgect and stating whether or not svch imurance complics<<4th the rcrvirements of the Resolvrioa. In thc event of any loss or damage in excess of 3100,000, whether or not covered by insurance, thc Consulting Eaghccr is to ascermia the amount of such loss or damage and deliver to tbc Supply S>>>tcm a cerrificatc sctriiag forth thc amouat and nature o!such loss or dsmagc, togcthcr<<iih recommendations as to whc:ber or vot such loss or damage shoald ie replace>L Cop!a of aay such nhnaiJ report, annual certificatc as to hsvrance, or ccrrifizte in rcspea of any such loss or damage wBI bc sent to bondhu>des Bing with thc Supply S>>>tern writtca requests therefor.(Rcs.Scc.9.10).Evvnts of Ddavlt;Rcmedics Under 5'e Raolu Con, thc happening o!one or morc of the foUowhg events comtitutes aa Et>>nt of Default: (i)default in thc performaacc of aay obUgatioa with respect to payments into Lu>>Revenue Puad;(ii)!Lfav!t ia the payment o!thc principaI of or default for 30 da>>>ia the Ie>ment o!ia>terat or any sinkhg fund imt Jlmcat on aay Bonds;(iii)default for 90 da>>>in the obscrvan ard performutcc of any other of t."c covcaaas, coaditioas aul a Jvvcments of the Supply S>>>tem ia thc Resolutioa;(iv)thc saic or conveyance of aay properties of ihe Project except as pertaitted by the Resoluriion or thc forfeiture through fault of thc Supp'ly System of any Ucense, franchise, p:rmit or other prit wgc nmsmry or dairab!c in the op>>stion of thc Project;and (v)certain cvcnts ia ooanection with the bankruptcy, Insolvency or reorganizatioa of thc Svpply S>>>tem.(Rcs.Scc.11.1).fn csc an Event of Dehult has occurred wldch has not been cured, each truitcc appohtcd by or pursuant to tb provisions of thc Rcsolufiioa is iertuircd to excrete svtt of the rights aad powers vcs>ed h it by the Resohtion and usc the same Ceg!Cc of cuc avd shll ia t!e exercise theuof as a prudea msn wovM excrasc or tuc ia the cirrvmstances ia t5c coaduc!of his owa af!CI!s.(Rcs.Sec.7.6).If aa E>vnt of Default s5aU have occurred, aad shJI not haec bccn remedied, the Bond Fu>>d Trustee or thc hoMes of 209>>ia principal amouat of th BouR ard additioaal bonds thea ovtstavdiag may dcchre the priacipal of aU the Bonds and additional bonds and the interest accrued tb>>!con to bc ed!ately dvc and payable, but such dedaratioa may bc aaauUcd under certaia circvmstateuu (Res.Scc.11.1).ARer the o~sence of aa Event of Defauh and prior to thc curing cf such Event of Dchuit, ihc Bond Fvvd Trustee msy, to the cxteat pernit ted by hw, take p!>>sess!on aad control of the Pro!ca and opeiaic avd msiataia the same, prescrib rates for Projea capahUity or power sold or supplied though the fsciTiriics of thc project, collect thc gross revenues rcsultiag from such opcratioa and pcriorm ail of thc agrccmcnts aad covenants contehed ia any contrxa~hi!5 the Supply Systaa is!ben obligated to perform.Such gross revenues>after payment of oil r tlag expcnscs>s CU bc app cd to the payment of principal of and iaterest oa thc Bonds and addiYioaal bonds.After aU svms then d c ia rapea of the Boads and addiYionsl bonds have bcca p id, and Jter aU Events ot Defa"'t have been n:cd or sea>rcd to thc sst!sf@won of the Bend Fund Trastw, thc Bond Fvad Trust-is reitrired to~>'Bh pots~avd conmsl of thc Pro>m to m Supp'y Sync@.(Res.Sus 11 3>]I 4)Tbc Resohrioa cmpowas the Boui Fund Trustee to 5!c proofs of vires for thc bcnc5!of thc hob!as cf thc Buds in lank!up!ay> Imolv~>or oogatrisarion prcoecdhtgs"d m hsrimte urit 35 for thc coBcnioa of sums duc aad unpaid in connect!on with thc Bonds, to a!one speciffc periozmanee of covenants contained in thc Resolutlca or to obtain Injun Jvc or OJez appr~ctc rc"cf for iae pzotecffzoa of the holders of the BOM.(Res.Sec.11.4).The holders of a majority h principal amount of the Boads ard adFF'till bonds at th-rim outs!and!ng have the right to direct the Qme, method aad place of coaductiag any proceeding foz aay remedy availab!c to thc Bond Fund Trustee, or exercising any trust or powur confer!cd upon the Bond Fund Trustee, but the Boad Fund Trustee must be provided with rasoaable searity and indem-nity and also may decline to follow any such directioa if it shall bc adrised by counsel that thc action or proceeding so directed may not lawfully be taka or!f R ia good faith deternrines that the action.cd'irected would involve it ia persoaal bablFJty or that the actioa oz proceeding so dhected wou!d bc unjustly prejudicial to the ho!ders of Bonds oz add!tlonsl bonds n p z'ot acies to such direction. No bondholder has any right to hstitutc sui: to eaforcc any prorision of the Reso!uritoa or the exeatioa of any trust thercundcr (except to enforce thc payment of principQ or interest Intra!1-)unless thc Boad Fund Trustee has been requested oy thc ho!dczs of not less than 205o in aggregate pz!ncipal amount of thc Boads thea outstanding to exezcise the pow g wers ranted it R I'fft tc such, suit and ualcss thc Bo"-d Fund Trustee has refused or fii!ed, d'dthn 60 days after thc receipt of such request and after h v-"g been offercd adequate sccurity an 1'th ch equest.Ia th>>event thc Bo"d Fund Trustcc has fsllnf or refused to comply<<(th the aforesaid request, thc Rcso!urion provides foz thc act!Ion of a Bondholdcrs W FNEGOTIABLE LATRUhfEf~ The 197$A Bords and the iatercst coupoas attached thereto are negoffab!e instruments to is cxtcr t prorided by tke provirions of Sccuon 54.24.120 of the Rcviscd Code of tVashingtoa. LmGATION'Ibere is ro litigation pending or, to thc knowledge ot the Supply System, threatened, quest!oniag thc covorate existerce of thc Supp!y System, the ritric of the otffeers of the Supply System to thefr respective offfces, thc validity of the 1975 A Bonds, the power and authority of the Supply System to haue thc 1975 A Bonds, the vdidity of the Net Bi!ling Agreemats or the project A@cement, thc vahdity of any other proceeding taken or contra..entemd into by the Supply System which is ia aay way re!ztcd to the Projec.', oz the power and uthority of the Supply System to ffx, charge and co!lect rates for the sale of power, cncrgy cnd capabJity from the projat as provided h the Rcso!ation. APPROVAL OF LEGAL PROCEEDINGS All!egal matters hcident to thc Nct Billiz.g Agreements, thc Project Agreeme" t aad thc auiserizarion and fsmaacc of the 1975 A Bonds are subject to the approval of hfessn.Wood Dawson Love tk Saba!:"c, 1M Counsel to thc Supply~, and hfcsszs.Houghtoa Cluck Con~>>'R'Jey, Spec'LJ CotmaJ to thc Supply S)xtai Cop!es of the opinions they propose to reader ara appaded hery as Exhibit IV.Amendmeats; Supplematal Resolurions Any amadmat to t c uJ dm h Resoluffoa m y bc made by the Supply S)litem ufth the conseat of thc holders of 66)5~o in prinripal amount of thc Bonds and additional boads thea rat!standing aa wi c consent of the holders of 66)zz%ia principal amount of the outstaading Bonds aad add!t!o=al bonds I f!t d b an amadmat which does not equally affect all other otnstznd?ag Beads and addittoazl bonds, provided that no such amendment M pcr"Jt a c"ge c pa)vnent of principa or any in a-paI of r't!L-eat of Intern!oa any Bond or add.:&mal bo"d or a redact!oa: of ia the principal or redemptioa price~red ti pri e thereof or the rate of interest thercoa without thc causa'.ach bondhouer so affected.(Res.Azric!c XII).WIJ:out thc consent of aay holder cf Bonds, thc Supply Slutem may adopt supp!ematal resolu-tioas: to authorize thc issuance of subsequent series of Bonds or addirionzl bonS;to add to the cov~l S tained h, or to surreader aay rights reserved to or coafencd upoa it b, thc Resoiutioa; to a to e res'"d th estricffons conmiaed in the Reso!ation upoa thc Issuance of a i-tion2 Indebtedness; to co as u..r nffzm f nher assurance aay pledge under the Reso!utioa of the revenues.on otherwise to modify any of thc provisions of thc Rcsolutioa (but no such modiffcaffzon may bc cffativc while any of the Bonds arc outstadhtg); or to cure aay am igF tty cure aa ambi or correct any defect in c esou'h Resoluffion prorid:d that the Bond Fund Trustee shall eonscnt thereto.(Rcs.AztMo X).REGISTRATION OF THE 1975 A BONDS BY SI'ATE AUDITOR Thc 1975 A Bonds will bc reg!stcrcd by thc State Avditor of the Smtc of Wash!ngton. aad a cerriffcate of such regisnation sigae y.e d b the State Auditor or a Deputy Stum Auditor will bc cndorscd u neath 1975 A Boa ia aaor ance wi I!5 B d'ance with the pznfsions o!Sarion 54.24.070 of thc Rcviscd Code of Washington, made app'o c u E b!t th Supply S>xtem by the Rnid Code of V cshingtoa, Secritoa<<Jo.54.24.070 provfdw, in pact, that aay revenue obligattons after having been so stercd and bearin such ccztiffcatc shall bc held ia every aaron.wit or proce ng ia valFTdty B or may bc brought hto--ri p b gh'vdoa pzima fa!c nvd ad bhang ob!!gsuons in aaordsna with a&r Lxms.TAX RKMPIION In the op~ton of the above named Counsel, thc htcrcst oa thc 1975 A Bonds wlff bc exe=p from Federal Leone tu"tkxz under cxfsJag laws ad rcgu!atioas aad specie-zuffngs issue!by the~Revenue Service, dated November 18, 1970 and Novcmbcr 30, 1972.hfISCELLAi MEDUS Thc referaces, excerpts and smnmsries coamined herein of the¹t Bi!rag Agree=ats, the project Agreement"d thc Reso'iuffioa do not Fupozt to bc complete statements ot the provii<ms of rA doamats and rdercncc shou!d be made to such docmneats for a full and complete state at of a!I matters ze!a F"g to thc~~thc basic agrcemcnts securing thc Bonds and the rights and OMgatioas of the holdns thereof.Thc auiFFxrizat!ons, agreements and coveaants of thc Supply System are sct fonh in the Reso!utka. ncithcr this Official Statcmat nor any advezthcment of the 1975 A Bonds arc to bc construed as a conum with the holders of th 1975 A Bonds.Any statements made h this Official Stztemeat involving maffers of op'-Fon or of esJmatcs, whcthcr or not expressly so Identiffed, arc iatendcd merely as sech aad not as repznenmtfons of feei All of the fnfozmaffon relative to the Pacific Nozthwest, Bonncvi!lc, Joint Power Planning Council aad Pzciffc No&west Utilitics Conference Committee have be n tskea from sources dcemcd to be rcliaMc but arc not gaaran~~as to comp!ct<<ness or accuracy.Be derv'f~~'Kclsl Ststemaz has baa duly authorized by the Supply Syseat.WxsttntcToà PUamc Powxa SUttLY SvsznM Enwnr W.Tavxoa Secretary ABC 5 f i If ("'I 05 l.i j v 8 P~dsaots Start(ctcs Share of Pfoi(ct Raccoon~Cs aht 8.00016.00263.05350.00666.01610.00272.00185.00182.00694.00090.00054.00586.00739.04017.00539.01769.06151.01996.00715.00613.00143.00161.00453.01634.00137.0552$.G0019.00363.00218.00033.0102$.00409(A).00041.00171.00370.00181.02370.03075.00719.00504.00502.00186.02376.01222.00220 toss Cairo rahhs 155 1,785 16,121 5,0$0 4,3SO 1,90S 1,2!3 1,62S 3,977'7'212$97 5,656 6,382 17,997 2,608 10,413 57,672 2.288 5,537 3,102 1,304 1,914 9,523 8,305 544 29,704 91 5,3$5 574 321 5,06$4,313 204 1,427 4,188 4,336 10,421.oa.2S,635 1,632 711 2,103 1,648 13,046 12.802 1,217~Payfsd~i Gty of Albion, Ifhho Ciry ot Bandoa, Omgoa.Public UOBty District No.I ot Bcntoa Cosmty, Washington .....Bentoa Rural Electrc Associarion, Inc.Big Bead Electric Cooperative, Lc..Blschly Lane Couary Cooperariive Etc~Associatioa .......Gty of Bhiae, IVQSYingon ...Gty of Bonnets Percy, Idaho.Gty of But!ey, Idaho.............o .................... Gty of Canby, Oregoa................................. Gty o!Cascade LocLs, Oregon Ccn\fcl Ecctfic Coopcrariivc, Inc.Gty of Central!a, WQSL'Qyon Central Uncoh Peoples'rility Diurict.................... City ot Cheney, Washing.'on Pubfdc Urii!ity Distria No.I of Chllsm County, Washiayoa.... Public USBity Distria No.I of QarL County,>%ashinyon...... Qaukanic Peop!es UtiL'ty Datcht~Gears stet Posyer Company Columbia Bmh Becusc Cooperarive, Inc................. Columbia Pou er Cooper tive Assochtioa, inc.............. Columbia Rual Hectric Associarion, Iac................. Consumers Poshm, IQ*C~cry Elearic Cooperative, Inc.Town of Cou!ec Dam.WASHY~PQSBc Uriility Distria No.I of Cowlitz County, Washiayoa... GityofD h,ia ho Douglas Eectric Cooperatisu, inc.City of Drain.Oregon East End Mutual Hecuic Co., Ltd.City of HIensbucg. Washington .Fall Rivet Rural Bearic Cooperative, Iac................. Fartners Electcic Co., Ltd.Public Uti!ity District No.I of Ferry Cotmty,)Vashinyon..... Flathead Elearic Coopecatisu, Inc.City of Forest Grove, Oregon Public Utility Dis:rict No.1 of FranLlin County, Wmhington.. Public Utility Distria No.I of Gmys Harbor County, IVash'"g Hafncy Eecuic Coopmrive, Lc..Gty of Heyburn, Id".o Hood River Eectric Cooperative of Hood River County, Oceym Idaho County Light gc Power Cooperauve Associatha, Inc....Gty of Idaho Falls, IdaPAs Itis"d Power I;Ligiat Co pang.9 Ih Dho:yD<<<<<<D I.I"DI<<(h Iy, W(~D (5)yD<<h~s.'I 0 I~y<<05'Dhutet No.1 of~County.W~27,169 388,710$,111,529 1,323,22$2,033,780 755,447 254,413 401,405 872,123 473,313 199,021 1,477,539 1,168,111 6,321,978 666,771 3,009,330 15.I 06,0SO 2,015,406 1,432,S13 1,067,072 46S.909 86$.810 2,68S,341 2,6S4,490 160,S24 11,504,144 18,1$0 I/96,211 183,381 67,254 1,086,S42 99$.459 44,15$496,215 8$2.728 980,130 3,033,105 8,540,24S 999,123 414,990 652,670 385,282 3,351,267 3,188,311 337,982 lis Parmp(=gs Sharc to Puhtic Usury (Corahmed on n-c page)38 E)fHIBIT I WASHD(GTON PUBLIC POIVER SIIPPLY SYSTEhf NUCLEAR PROJECT NO.2'Ihe Parriclpaats, their customers and gross rcveaucs, aud Pacrieipant's Shares of thc Project capabBlty. ~Payftd ot Public UtSity District No.I of KLhkitat County, Washhyon... Kootenai Becttic Cooperative, Ia" Lane E!cctfic Coopefauvc, In~~~Public U:uity Dis:Qet No.I of Lewis Couaty,)Vmhnyoa.....Uncola Ei:ctcie Cooperative, lnc.(Montana).............. Lost Riict Ecctcic Coo"cfauvch Inc.~Lower Val!ey Poisvt 8: Gght, inc.Pub!ic USSity Dhtric:Ão.I of Mmon County, WMinyon.... pubfBc Utility Disuict No.3 of hhson Coimty, Washinyoa.... Town of hfcQC ry,'\Varidnyon City of hfcMinnsal!e, Ocegoa hfidstatc Bectric Coopehratisu8 I~Gty of hl!Iron-Frecuuter, Oregon City of hfiaidoka, Idaho.hgssoula Eicctu'c Cocpefarivc, Inc.Gty of Monmouth.Omgon Nespricm VaL'cy Bcctri=Coopaarivc, Inc................. Northern Ughu, Inc.Northern Wasco County People's Utility Disuia............ Okanogan County Ecctric Cooperative, Inc................ Public Utility Distria No.)of OLanogaa County, Washngtoa. Orcas Power<<aad Light Company Public Utglty Distrn No.2 of Pectic Cotmty, Wmhhoyon.... Gty of Port Ange!cs, Washhyon PrJYie Power Coopersrisu, Inc.Raft River Rurei Eearic Cooperatisu, Inc................. Ravalli County Beach Cooperative, IQ-................. Gty of RicMand, Washnyoa RinrsMc Bear<Con:pany, Ltd.Gly of Rupert, Idaho.Rural Hectric Compaay.Mem Hcctric Mmon Rlvcf Hecui" Coopcrativcf, Inc.~~~~~~~~~~~~~~~~~~~Gty ot Seattle.Washhyon.................... Publh Uri!ity Distria No.I ot Ska<<mania County, Washhyoa.. PcbEc Utility Dhtrict No.I of Snohomhh County, IYashinyoa. South Side Electric Lines, Itc....Gty of Springdeid, Oregoa.City of Sumss, Washington .Surprise VALicy Eleacidcathu Corporation ................ Tanner Hcaric Til!amook Peop!Cs'tility District, Umatilh Eicanc Coopccativc Association ................. Unity Ue<<ht<<mal Poivet Company Vera Irri~garion Dhtria No.15.Viriiante E!each Coopemtivc, Lc.Pu!!c LTBi:1 District No.I of Wahkhkum County, Washhsyoa IVasco Bcctric Ccopcrarive, Lc.West Oregon Bectcm Cooperwve IQ-TOTAL~~~~~~~~39 t ties Scactsttn Rcccoocs 1,788,$58!,OS1,040 2,019,895 3,703,733 528,653 372,6S2 1,866,175 439,058 2,898,63$218,860 1,675,956 I,105491 640,99S 7,729 859,5$2 381,692 2$3,461 1,364,914 516,771 207,370 2,981,689 989,451 2,022,730 1,994,158 S0,390 1,106,458 588,330 2,6S6,624 40,857 4SS,714 494,'173 1,309,752 359,886 63,848,358 834,987 28,765,124 149,859 1,436,100 73,916 80S,466 176,338 25752,344 1,826,413 267,900 645,259 816,425 391,753 756,790 673,833 Cosroiacn$,999 8 4,789 7,654 15,716 1,632 1,35$6,659 L541 12,373 642 5,692 4,092 3/76 54 3,731 1,867 1,110 5,844 2,519 1,027~11,661 3,$49 11,218 6,995 323 1,736 2,195 9/32 208 2,086 1.98$7,150 1,277 259,444 29742 106,832 399 6,236'322 2,929 709 11,345 4,883 1,101 3,349 3,100 1,967 2,309 2,672 858,90hy ,230,773,352 Paittd syaoc~Shan or Pcoicct~C~s4!J.01009.00391.01452.02274.0025$.00202.GOS20.00231.01446 X@234.01227.0048S.00583.00005.00294.00236.G0149.00455.SI51.00190.01042.G0725.01503.02416.000!9.00853.00301.02761.00020 AM34$.00262.00453.00170.07193.00547.15363.00073.00363.00048.00323.00122.01729.00036.00204.00701.00294.00328.00342.00182~(<<.<<.whee~.h<<hhyy ~sw-Dy 0 LL.AI AL~LALALWC OLLeL SALLL AAALITLS LYALOATIOAS LIAAIACL LALNL FILE NO.SS-1119-NFI-TA E>QHBIT H R.W.BECK AND ASSOCIATES sa Towtl LosoTLO stATTLL WALIAIA:TOIL TTICT LQLAIeAtLL OLLA<<Ala SLAT hl.w AIACWAL CLAATk COLOALOO IWOLA<<, AOTOAA o<<AhOO.<<OLOA.COLV4%IL HC LAAVLA hfarch I, 197$The Supply S>stem is nudertabng prelimhsry work oa tvro additional nucksr generat!ng fariiiYies desiymtcd as IVashi"yon PubEc Power Supply System Mear Project No.I and IVash!sgton PubEc Po<<ur Supp!y Sperm Nuckar Project No.3, which are, as is the Project, aa intcyal par of Phase I ot thc Hydro IILcrmal Po<<ur Program.The Supply System<<ill hale IOOLyo o<<TLaship of Nuclear Project No.I and 70!ro o<<nership of Nuc!ear Project No.3.The Supply System's o<<TLership share of th>>output of these projcas has ba:a sold under net bKng agreements slmi!ar to thc Net Billing Ayecments for thc Project.Each of these projects is a separate utl1ity system and thc revenues of each arc respectively p!edged to each s:paratc s>vtcm.Ia a!dition, th: Supply System has undertaken preliminary 6naachg and preliminary <<erk on t<<e additional nlwlear gererating feei!ities known as thc Wathinyon Pub!ic Po<<ur Supply System Nuclear Project No.4 and tVashington Pub!ic Power Supply System Nuclear Project Ntx S and is Invmigating thc possibilities of its partieipation ia nuclear generating facilities kno<<TL as the Skaglt project to bo built by pugct Sound Power 6: Light Company.Tbe Supply System antkipates that its o<<TLership interest h these Pmiccs will bc~as a single utl!ity systan.The Projec!Board of Directors Washinycn Public Power Supply S>stem Richland, Wash!ngmn Gentlemen! Subject t Summary Engineering Rcport Washington Public Power Supply S>stem Nuclear Pmject No.2 Presented herewith is a sumtnaty of our analyses, invustlgat!ons and studies with respect to the proposal by thc Washington Public Power Supply S>stem (thc"Supply System")to issue$125,000,000 of its Washing:on Publk Po<<ur Supply S>stem Nuckar Project No.2 Revenue Boads, Series 1975 A (the"1975 A Bonds"), for the purpose o.'aying cert'ost of acquiring and construing a nudear-fuekd ekcuic gen:rating p!ant with a nordual capacity of approximate!y 1,100,000 hlowatts and related fariiities (the"Project").Thc Supply S><<tern has issued a tosl of$355,000,000 of its IVashi-"yon Public Power Supply System Nuclear Project No.2 Revenue Bonds h three s:nes, S:r'es 1973 (tho"1973 Bonw"), Series 1974 (the"1974 Bonds")and Series 1974 A (the"1974 A Bonds").The pmsent proyam provides that additional revenue bonds will be blued at kter d".es and in amounts necessa~to comp!etc the conrtrcakn of thc Pmject and p!acc it Into operatioa. 'Ibc Supply System 1s a m~Yiptd corpomrion ~a jokt opcraring agency organ!ra!under thc Is<<<tern o<<ms and opemtcs thc Paebvood La'ke H>vkoe!Oaric Protect of 27,500 kVa of na-e pLate capacity Iocsted ia Le<<is County, IVssh!agon, the ste"=~learic generaring plant cf appmxinately 860,000 kgowarts Iomtcd h Benton County,>Vaainym, knovm as the Hauford Project.Steam is pmvidcd to this hite!projea fmm a nuckar reaetcr (tAA: "Ncw Productioa Rcartor")o<<ued a"d operated by t!Lo Energy Reso rces Development Agency (tbe"ERDA"), a sumcssor agcn~to thc Aton Tc Energy Comwfssion (thc"A~, oa its ord Reservarioa near Richland, Washhtyon. The Supply S><<tern issued S13,700,000 ot P-bared Lake Hydroe!ectr!e Project Revenue Bonds, Series ot 1962 ard!965, to 6as m conssuwtlon of the Pa;brood Lake Hydmc!cctr-'mjmt aad$122,000,000 of Hanked Pm': Electrk Revenue Bo"-'s, Series of 1963.to!man."c constwaioa of ts-Hanford Project.Ea."h of these pmjccs is a sqmm u8iny s><<sm a" d tho raven~of each arc respectively p'.edged to the sepal systems.Tbc project is located approknately 12 mL'es north of the City of Richland and 3 mlles west of thc Columbia River, in Benton County, IVashington, on thc Hadord Rese~tlon of thc ERDA.Thc Project vill Inc!ude a nuclear stem supply system manufactured by thc General EIectric Comity that<<TII employ a boiling water reactor.Thc nuclear stcam supply s><<tern<<ill Inc!ude thc necessary auxlqdlary s><<tems required to control, consin and service the nucle r reactor core.Stcam wIII be suppEed to thc tmbinc t approximately 935 psia.After driving thc turbine, the stcam will bc exhausted into the condenser which is coo!cd<<ith cuuu!sring water from n:echanical draft cooling towers.1Vater will be<<i&drawn from the Co!umbia River and strsbly treated for usc as makeup to thc coohng to<<ur circa!sting system.A IVcsringhouse generator will bc uhc main generating unit and will bc rated at I/31,700 kVA.'Ibc generato:<<1II be conncaed to 3 shtglc phase power uaasformers and t<<e auxBiary transfthmcrs. 'Ihc men power transformers <<1Q step up the geaerator voltage to 500 kV.Dehvery into thc Federal Columbia River Power S>vtcm wpd b: over a 18.3 mvc 500 kV transmission lkc to be consLLuaed by Bomtcv!UO Power Admiaistratioa ("BonuevZc") between thc pmject and Boa"evvl"s HMotd Substatioa. Thc project<<TB have a nct c!mtrical output of approxi-mately 1,093,000 kvtowaus.PermIS and Licenses Thc splice site for ue Projea hs been cer6$ed for thc Stam of Washinyon by thc Wastungton State Thermal Po<<vr Plant Site ET<<!nation Counrik The Supply S><<tern submitted to the AEC a Ple-I:~Mcty Analysis Report and an EOTTronmental Report for the projea<<hich werc rcsdewed by the AEC.'Ihc Advisory Comm!am on Reactor%&guards of t".e AEC, on Gctob:r 19, 1972, aeckdal ths:, if due aesiderarion is y'vcn to the cern=eats of th=Commtkc, the projca"can bc constructed with reasoaab!c msur~th t it cm bc opcratcd without undue risk to thc health and safety o!thc pubIdc." pubL'=lesriags<<uro cad<<red in~dane<<ith AEC licensing requircr:cats, aA thc AEC Uccnsing Bo d on Mmh 19, 1973 ya" tcd t>>e Supply System a aestruction permit for Oc projca.'Th=construction schedule hss been plepaed by 6c Supply System aaI Burns and Roc, Inc., m Cps'wrion Eny"ccr sc!meed by tho Supply Syst:m to dalgn and supersfsc constructkn of the project.Ere@~i of tkc co"'"-ent vessel was aa.M fa.Septuor 1973.Cocgkg tower ccnsuuaion <<us P started in April 1974.Th='reactor vessel is scheduled for deliseiy in Deccmb r 1975, and the turbhte generator is scheduled for delivery in Junc 1975.'fbc Constiuedon Engineer has projtuted that the Project is eight months b"hind schedule, and has rcschcdulcd the date of commercial opcradon to Jrne I, 1978.The Construction Engineer is of the opinion that thc program for const tucrion is rcalhtic and a commerrial operation date ot June I, 197S has a rea<onab'ie cfzmce of achievement; however, accord-ing to thc Consuuetion Engineer, realization of such a conun rcial operating date v9(U ietluire a signif~ant improvement in the rate of construction progress.c As of December 31 1974 etluipment a%construction conuuct conuuim~nts to:alcd$25 S,058,567. 0~Actual expcn6t"w to Decembe.310'1974 are summarizcd,ht thc foUO<<ing tab.c: Tomf Consuuction Cost................ $123,4S7,400 I(uclear Fu:I 11,85~~700 Bond Discount and Financing Cost........2,664.100 I ID 3 0 OMS (0>~.....I9340000 T lll..................... SI57304200 Long Term Fiaanciag Program term Sauncing program contemplates the issuance of Bonds to Saancc ihc constmcrion and initial operation of thc project in several series.The$150,000,000 cf the 1973 Bonds werc ihe Urst Bonds issued.Proceeds from thc issuance of the 1973 Bonds werc us4d to provide for thc payment ot thc.$55,000,000 ot outstanding revcuuc notes theretofore Issuaf for thc project and to pmvide addi-tional funds for construction of tM Project.The proceeds from the issuance of thc$80,000,000 of the 1974 Bonds and the$125,000,000 of the 1974 A Bonds are being used to pay thc costs of construcrion of thc Project, mid the proceeds from thc$125,000,000 of 1975 A Bonds<<iH bc used io pay the costs ot conriinuing construction of thc Proj et.Based on preseiit estimates of actual needs by thc Consttucfion Engineer and the Supply S)ztcm, the proceeds from ihc 197$A Bonds vriH b: suGieient to eoniiauc eoa-stiuction of ih Projcci until thc sum.-r of 1976 prior to<<hich'-hc addiiional Bonds arc plamd io bc IssuctL The a cunt of tho nezt issue of Bonds will be deter@nod med'ately prior to the rime of issuance ted Financing Retiufred(1) Total Coezttucwon Costs(2).....$2S5,210,000 $10S,145,000 8 98,161,SOO $491,516.SGO Nuclear Fuel(3).............. 12,445,000 2.382,000 26,102,000 40,929,000 Financing Costs............. 2,664,000 2,250,000 2,412,000 7 326.0M Interest During Consuuetion(4)... 81,903,000 22,656.000 21.049.000 125.60S.OOO Gross Retiufrements ......" S382,222,000 $!35,433,0GO $147,724,800 $665,349,SOO Less: Estima:ed Insustmcnt Income........... 27.222.000 10.433.000 13.724.SGO 51.379.SOO NI RIOR'\~~....~...5355.000.040 3925.000.0N 3934.0NON SSI4.MO.MO ll979M 0 DG'DMS IR.I I Ill'9992*% ~ll fn project eomS~i42a<<7322td ra27tt ia sa hersase ia these coats.Scc Ezhibx fiL 01)lect~i eocsuuedea <<ons.c~~ee~sad esmsuu~a smaRS maz eau, aafsdea azd ceca-~as by iha (ZSaurGD~Eerieca;Red o<<<<RA 4'rem Coii RS~G-4 t7y Z'M Sappty Sysum.(3)4490 atfmsud by the Seppiy S>vtsm;Lch25a sita iiz.(4)Based ou a~Mrieioii rata for SRRI 1913 Bmds, the t974 BanS.ihc 1974 h Beads L25 assumed~est 1<<rat rata of 7&46 oa ihe f935 h Boa&Raid 7.35%oa the~BSmh.42 In add rion to thc foregoing amounts obtained through issuance of Bo"-S,, fuM required to maLc thc necessary papa.ts:o thc Reserve Account tin thc 9<cd Fund, to provW worhng capital, to proiide an Initi I Reseivo and Contingency Fuad and to provkfc a contingency for fuel arc expected to be obtained unde;the Nct Billing Agreemerts describcd below during thc period beginning Januaty I, 1977 and cztending to September I, 1977 as foUows: Rcseivc Acszydnt in Bond Fund(l).KVorking C"pii J(2).Reserve aud Conringency Fund(3)Fuel Contingency(4) TotaI S21,127,GOO 3,000,000 3,000,000 8,000,000 333,927MO (t)Esttmstod s~t ieeeiied by the sappy s)stem's Resohs4sa)rsz 6SOS (3)h22243eet sebjea m fDSthor Resiyiis aad spprovit by BceaevQfo aad ibo seppty system.(3)tmlou23t rrq2<<cd by Qe zuppty system'i Raoh3tf63a yre6 6eo.(4)Est(assed amount to be pr43vidcd f573m Rdviaisd aoi bnties io permit foSDI~of seausl fDet eoiu ia the ewat of a cririesi period of pclvcr scppiy.Amccat scbBct to fur~Dr aai'.yus aed approval by Beaeevine aA ihe Seppiy Syuem.H for any reason such amounts (other than the fuel conriagency) arc not pmvidcd under thc h7et Billing Agrecmenlts they will be provkied thmugh thc issuance of additional Bonds.Cost of Power Estimates of th: annual c'os!s of thc Project'5 operariions have been prepared lmsed on 1974 costs of labor and matcfi Js escalated to csthnated 1978 conditions, the actual hterat rate on thc 1973 Bonds, tho 1974 Bonds and thc 1974 A Bonds, and annual interest rates of 7.2556 on thc 1975 A Bonds and on thc additional Bonds.The costs rcgect those operating costs that would bc characteristic of a maturo phnt.Thc total annual costs are es(iumtaf to be approzinutely $70,330,000 for thc generation of 792300,000,000 kilowatt hours minuJ)y amounting to a unit cost of 9.77 mUls per kUowau hour.The tgJ annual costs referred to above me baal on level debt servix over a 35 year perioSL The.Supply Sys:cm and Bo~~IO-ti pate thai mauuitics of thc~w<<iH not be sehufuied to yieM 1~xi dcbi servLo Lroughout Qm pcrioSL Variarions fn annual costs will renilt from st@schedu)iag to tb cxtcnt that wuJ iLbt scrsi-varies from the msumd level debt scivLc.Sale of Power'Ihc cadre capabUity of thc Project has been prchased by 94 public agency PartiYipants pursuant to Nct BiUing Agrccmcnts enmicd Imo bcnvccn the S-pply System, BonncviL'e mf each pzrtfripanh 'Ihe Project Output'Ihc Project is expected to have a nct peaking capabiLity cf 1,093,000 kUowatts and is exp'o bc capaMc of produchg Jxsut 7"00 000 000 kHowatt hours annuaUy.Duri"g a critimf period ot power supply in thc p riSO I(or9hwest earned by water shortage, it is expected t" t thc proj~wo Jd bc caHmf upon to pmducc thc fuH amount of cncrgy that it fs capable of produring. During other pcriods, howmur, there wiU b.thres whea surplus water viU bc avaUabh to generate power at exisring hydroelectri projerzs thereby pamitriag" reduction ia thc total amount of energy produmd at the thamJ cfemio proofs to bc constructed under the Hydro Thermal Power Pro@am, Induding thc Project. ~>>Dbufcts hfu!!cfpaL'dm...."""~Coopaanvca Total.....~22>>'7 45 94~PP>>II 56.363 22.639 20A93 1 OOA)00~ty p&gc Un!sty Divulge 4 Peep'u".sty Dhutets, aA!1sstrstkpa Dliuict.Nose: gescsessy sist!id il tefosscssleu oa the PsstMpsats 0 riven h Tsht+h st the Nct Billing Agee ents obLgate the Pasmpants to pay e>1 o.the Project Annusf Co Annusf Cosa as defhed h thc Agree=cuts. The rumbcr o!Pasthdpsnts and the extent of pewpadon folio<<>>by mah cateDsdes: In addidon to thc forcgohg projects, thc Supply S>>>tern, pursuant to a request by thc Public Po<<>>r Coun@rcpmsenthg morc thin 100 statutory preference customers of BosmevZc in thc Pacidc Noah-west,>as also begun pseliminssy work on the Supply S)>>tcm's Nuclear Project No.4 and Nuclear ProIe t No.5~is invesiigcsieg mhcr elec'".c generating facilities. It is presently planned that the Supply S>>>tem's Nuclear Project Nsx 4<<11>be a duphicate plant ot the Supply System's Nuclear Pro,'cct No.1 on thc Hanford Rcservadon ~and that thc Supply S)>>tcm's Nun!car Pso;ect ho.5 sill be a duplhate plant of tss: 5upp!y S)>>tcm's Ncc!ear proje:t No.3 at m Satsop si:e near Aberdeen in Grays Hssbor Coumy, RVashhg!on, The Supply S)>>:>>m is n:gothting <<iih thc hvcstors<<ued utilitks<<ho sha:e o<<uesship in the Supply S)>>tern's>>Nuclear Project No.3 concerning possible sharing o!o<<sicsship of Nuclear Psojo>>No.5.The Supply System is Jso hv>>stlgathg the pou.'biiity of paniqpathg on a joht o<<sic!ship bash with pugct gourd po<<ur 4 Light Company and other hvestorpo<<ucd utilities in puget Sound power 6: Light Company's Skayt project to be located h Skagh County,)Vashington. 'he prelindnary work of thc Supply S>>>tern on these projects to date is being dnanced from thc proceeds of 517,500,000 of Washington Public po<<ur Supply System Genesathg Facilities Revenue Nom which werc issu:d in t<<v>series, Series 1974 and Series 1974 A.Bach Pastici ant's share of the output of the Project has been ass'gn i ed to Bonsciillc which, h i nt wB cscd>t the Pasticip ut each year, agahst amounts oivhg to Bo""eiille suc i,"'hich the Pa>>icipant is required to mMc to b such Participant, a total amocnt equal to the payment<<the Supply S)>>tern for su)>>as.is p~'h.Tl roccss referred to hcreh as"r~t Mling" is more hlly LSieussed h thc 05cial Statement to v;hich this repo'st is at!ac~~Other Proposed Projects The Supply S)>>tern Ba'g pse'~sary work on two nuclear gcncsathg fscilitics lu addidon to thc Project.P Thc first of these, designated as Washington Pubih Power Supply System Nuclear Project>o.1, a!ed on thc Hsnford Reservation near thc site of thc Project.This B a 1,250,000 hlo uu pro>set lo ate on c ed to be built at thc site of the" or roj.i!hash<<d Hanfosd Project generating facihities hto its design.t ccn c e the site near the project in owfer to Jhow conthucd operation o of rcien~ue notes iss cd in ycne 1974.Present phns psovide that the total cost of thc ed f th issuance of long-term bonds.Application for site~'ashh"ton State'll:csmal Po<<er Plant Site Evalwihn Council of approvsd has been submincd to the W gton ta e the State of tV~vs g.on and thc nuclear stcam supply s)>>tern has been o rc esi ated as'6'ashington Public Power Supply S)>>:em Nuclms Pm;cct No.3,'red-oe"t<<i'hthcgu l Systcmowni"ga70pcrc.ut 30 pe cent in!crest.A site hr imdivided interest mid four hvestorm u~~v ed utgiues o<<uing th-retraining r ear Aberdeen h Gra)>>Harbor County, as i e this pro>ect has been selected n work on thh pro,'ect is under way.Thc Supply S)>>tern's s.re o nt P lans prov'.dc that the Supply Systesn's 70 pere.nt owners'p s the issuance of io g~>>esmbonds and Powcs Supply in the Pacige Noah<<>>st" w i.is summary~ccsing scpcct fs an extu>>iit.Based on our study and anal)>>cs of thc Supply S)>>tem's proposal to consuuct the project, wc arc of&o~>>'on that: 1.Thc o!Put of the project is sequ>>cd to meet thc load growth of the utihty s)>>tems of the Fadge Northwest under thc Hydro Thesmd Powes Program.2.The¹t BG>ing Ayte=ents boom th Supply System, each Participant and BonncvEe provide a so&basis for pr~wish thc fhanchg o!the ccnssswon of the Project through of Bonds as pioposcsL 3.The estimated cost o!the outpu!o1'the project fs rsnscnabie a"d comparable to costs expcctcd L>>un sLnilar nuclear projects to be dcve>oped withh the same thne frame.Conclusions ~May~/s/L W.Baca mw7>Assocsayxs 45 We have fusnbhcd to)xiu information contahed h the Ofgcfsl Statement under thc capdons"Project Fmmschg Reqtdscments","Project Output", Project Annus)Costs","The H)tfso These Powc: Psogsw A>>" Poet Supply h the Pmc Northwest" ad Bxhbit L Tn our ophfon, the hfosm" non contahed the!eh fs cosrec!. Tfhi Po xo oo,v N NLI.cro.,~8'.441..;."'5oND 4 Els'2 Tab'e A PROJECP PARTICIPA.L IS Summary of Haanda)and Stat!rica! Data it s To tot vovt Toit: Burns and Roe, inc.220 Fonoo Avenue~Itepxpstosd. sew York ttSA~Teophcco (stc)48$4cco 7(VX 6104224049 ~Cxh!e BVRCK HD4PSTKADNY Sioaitta Cusyoll t ts 1 Rovtfcadxt Teel EvStxcv Sacs: tWB (000)............ Evrxov Pose<<Ssxsi ah (000)Boaoovitto (nxaford Prelect Exchxato)Boooovato.On!or Total Eocrgy Porchtia'Dvh (000)..Ktsxxcv Gxoxaxrxo: tVVb (000)~....~..~Total Kaorgy RoCulrce<<an t%h (000)Pcox Ds<<xyavsi tW........... ~~~.~~~.Oporonooo. 1<<coo(xi To<<1 Opiaiiog Rcvoaoos....~....... OP!or ItcoSxse (Nocooportt!ag) ..~~~~~Totxt Iteono~~~~~~~~~~.~~~~~.~~~Orxxxve$0 Kxyx Nscsi Purchoicd PoLvcr Boco<<viTe (llxoford Prelect Exchtase)Boaocv¹o................ ~~.~~~~On!or.Totxt Porchx<<d Power Expioxe~~~Ocacrxdog Kxpoa<<~~~~~~"""""" Teal Pov5or Sorpty Kxp aie~"hor Exroaie (IodcdSag Dep~tng Tax oi)To&Oportdog Expoa<<o.~...~..Cotdooicd Bxtxace Shoot Not Vc7Nty Pliat..................... Other Pioncny tad Iavcoa<<atx .......Correct As<<tt..................... Deferred Dc'S<<......~.~.~~~.~.~~~~.Teel Aisoio.................... Disirioio sxootnoonuoo coooosoiivoo 318.790 364,163 13,428,085 2.840,603 I 0,492.C6)1P06 13251532 559358 I)$10,830 2$47$7$)02$6)341,01)9,118.891 164.645 3,$855033 456516 509.0!I 5 623 623 IO,V&.677 1$24$22 127,619 153,669 3,60S.SCO 504$81 3 463 010 I 101 9P69292 2,094)$71,686'35/$4 748,ID2 858$05 26315 TN 3$ttk229 17,840.106 6213 215827$1S 6,184975 28$12.193 5$06.6S4 7 19,855 827/47&.638$49 5$4$$55 14$69$91 N.911 20612'll 6414.67 26677 955 5.$56.651 SIC)$)RTIS$$4.105,125$43,449$09 2933.56 3220,'lll NNII llo,l5L6N 4 47 3:5 99 9 11.21$654$211.60&09 59 N4$%0,778$52 663D 65$237.608.611 $216,1$f.65f 8 10$59,140 5),t(Xk9)5 1.0'9.$25$64,669$(O 10350DII$75059513 IIM I.'I 2 19IP53.3N$16$13,489 45,18 161.656.5DS 9 PL 63Ãl,lil L565.164 1 665399 D 108217 473$115P39412$293,1 89,87$7)~N65,840 49,63f NN22 11.622A66$421,11)A06 $401,162.021 5'60.895 30$35.1'73 9271.Dl 449,433,19D $1$8$94.623 9,624 877 20$52"I I 4.63 i.'19591P14 $883$46$22 135 751 (tv 2.722 9 0$1,141,743,170 5$40.666274 50$4N 924 9$,601,726 9.44 I$1$'9$5S.165 Ixxtnxtvvsi 15oapTcrm Doht~~~~~~~~~~~.""'" Correct UohnttSa~~~~~~~"'eterred Crcd!ts~~~~~~"""-""" Ro<<rva.Coauihssdcos h Atd of Co~4 Rctxtood Kxrohgi.................. Tccot 1)tt3(htta ................ Percent Po~tNNx$168,60)A05 21,427$$1 Sfyt)$33 112,192$$37.114 2~19.631 llli 713,NI 56268$240.602.0CO 1$$14$76'88$56 3,t44,137 9 930.835'IIDSN515 1494 4l 2 550 22.639$156,106$2 I$$50,077 79)$3 190.717 6N11$60 IS369N$'319191¹20A93$565$12$26 48,751,704 9.626$01 4207,1C6 24A$6,709 I.59.DI$1@4'1$43,170 100.000$506.849$3)415829,835"g,402 3,4)0$04 2'15.736 653 I.$9$1.049,$58,165$8$95$36$5 6.623 8'1.636781 31$69$)0 10$5K119 W5$0.786 2)5.505 80$$92~8$28$40 N(yk)TI'1228),7)4 8 IR225$95 3539394 61955N I 5 9 9 1539669.$19019400 4 122'I!844 1 8,19D 446$7LN17N$3515LI04 2 5 1 0 Board of Direc:ors Washinyon Public Power Supply System Rich!and, Washinyon Slot!0 Cnxoe TCO iuoeoSxo$ooc k ttoox Opodou, Noo JOSOOy 01443 hfa:ch 6, f975 Subjects Washington PuMc Poser Supply S)stem Hudcar Projea!qtk 2 fhe Pro jec,'21 consist of a sing c u 4t, bodmg~~t~r rcaaor c cairn generating ~t~t~~n hav nomic capaaty of 1,100,000 kilowatts together vfith thc neccssa5y transfotmtdon, ssitching aad related 500 k fuasidcs to intcreonnax the generating shtion vfith the 500 kV faaiiiics of d:c Federal Columbia River Power S)vten.The plant hyout and deign, which provides for thc initiJ development of a shgic 1,100,000 k!$$sutt unit,!naudcs coasidcrat!on of th possible future expansion to a staion with ano er gencrathig unit Foaowhg is a summ-p desefipdon of thc ficafic gencnuing stadon.The Projea sid bc located on the Hafiord Rcservadon, approfimttely 3 nd!es oust of d:c Co!un:bia River and 12 mQcs nonh of thc City of Richhnd.The plant<<i!I consist of a nudear stcam supp'iy s)steat, turbine-gaicmtor, coo!hg tosur and fiver makeup water pumping aaf b!Owdosvt discharge facilities, comp!Cm vi h stn~e, auxiTiay equipment, iasDiumcctadon, confro!s and other associated accessoncs. There sill bc s:vcn basic stmctures compfisin" th ovcral!power p!ant.'1hesc are thc reactor buil~ng r~vo sutta M!ding.turbhe-gcrerator buildhg, diesel generator buikhng and savicc Barns and Roe Ine.has been selcacd and rctamed by%rayon Pubhc Po icr Supp y System to provide cngineefing. design mid construcdon management services for DWmhinyoa Public Power Supply System Nudm project 10'tk 2 (the"projea")being eotnuuaed on thc U.S.Atomic Energy Commhfion's Hsnford Reservudon, near Ricxtud, Washinyon. Burns mid Roc's raponsibihdcs cover comp!etc engheefing. quality assumncc and construaion management seisin a-d include prcparadon ot phns and specidcadom, capital cost esdmadng.site sclccdon, pardap tion in thc preparation of app!ications and reports for such items as thc Luclear Reydxtory Commission (the"LLIRCN)consttuaion perndt and operadng license and Corps of Engineers'ermits, economh analyses, projea scheduling, rcvicw of bids, cxpedinng of vendors and contractors, assistance in phut stan-up and test and training ot opcmding pcrsonwl, manayng of construcdon con-tracts and coordinauon of contracton, direcdon of contraaor worL, es:ab!hhing and administefing site safety, smufity, Erst.aid and other such site programs, and a!I related items to result in a complac and successful oper" ting phut.47*0-t0NL<<' buMng (togetss:r conprising m maLi p)snt),<<ooUng towers a=d<<L<u)aring piunpho sc, and river naL<<'iip<<'atef p)aaL AU structures <<iB be generally supported on compacted structural fi)L Thc approximate ovcraB dimensions of the maht pleat<<Jl be 420 feet by 360 feet and thc nahum heighi from baseincat to root will be 225 feet in thc reactor building and 180 feet in the turbiac-gen<<r tor buildiag.Thc reactor building wilt be of concrete constmetioa and will include a seed suptstruaure. Primary eoataL>>ntent uiB bo furnished by a scparatc steel vessel withia thc rc" ctor building.This vessel will bc surrounded by coa-ae:e from primaty shielding. The radioaaive waste dhposal facility, which adjoins the reactor building and houses thc equipment for treatment ot radio"cuve was'.es, vill a)so bc concrete.The turb)ne-generator buL'ding siB have a reinforced concmtc foundatk>n. The portion above gad<<siU bc of htsu)ated metal pane)s except for the nuns<<ndosed by concrete for radiariion sh)e)ding. Thc nuclear plant wiU contaht a General E)cade Conpny boiling,<<ster reactor of proven design.The reaaor core will coataia 764 fuel bundles<<ach coiuposed of an 8 by 8 rod a.ray of sfighfiy enriched UOs peUets<<ith ZL~oy-2 dadding.Thc assembly wiB bc cont"ined ia a Z)resin)A reusah!e<<oo!xat fiow channel which wiB provide a fixed fiow path for'hc boiLiag coo)ant, seri<<as a guide surface for thc control rod blades mtd protect the fuel during h."dfing.Four fuel assembhcs wBI surround each of 185 contre)rods, whkh atu bo:ton mounted and'h>t)raulicaBy driven to control reactiiity aad mode)ate rcaaor oinput.Ihe core aud associated Iaternris wiB be housed ia a vatical steel vase)approximately 76 feet high and 21 feet ia diameter.Thc nuclear s:ean supply systan siH be comp)ac uirit stean separators aad drias, rocircu)aring pu ps aad sub-syscns!naut thos<<required tor norma)operation aad for shut doss.The nuaear steam supp!y system wHI have a gus~re<rariag o',300 megawatts t"erm J aad will supply approxhnatcly 14,295,000 pounds per ho r of stean at 985 psia<<ith fecdiva:cr rerumcd at 420 degrees F.Tlis s'.cern to the turbine-generator <<SU resu)t in a gaaranteed output of I~154.745 kBoustts of genertion under expeaed condirions of opentiou.After subtmaing thc electrical require-ments for snrion operatiag aux)Uaries, thc net p)aat output eU'e approxins:c)y 1,093,000 kilowaas, The tarbiao generator uiB be a tandemeapound. 6-fiow unit consisring of a hi~it-pre<<rut<< tur.bine seaioa on the same shaft with three low.prasurc turb)ne seaions and the e)ectrie generator. Each low-pressure seaioa will ans)st of two paraLiel fiow pathsmahag .total of six paraUcl steam exhamt paths.The exhaust end of each turb'iB contain rotating b)adcs 44)aches ht length.The turbine.generator rotates<<4 1,800 rpn.Thc generator sill bc a three-phase, 60 c)u)e AC unit rated at 1,231,700 kVA at 0.975 power factor aad sill genaatc at 25 kV.Thc turbine cycle will iaclude six points of regenerative feedwater heatiag utiliiriiag extractioa steam from thc turbhtc.The feedwata heaters sill be ainnged in parallel paths,<<ith thc lowest pressure heat<<r in thc nccL of the condenser to<<I)ect economies ia space and materiaL Steam exhausting from the turbine will be condens:d by circ<<)sting water coo)ed by tnechsnical drft cooling towers.The coa-densate wiU thea be retu:ned to thc reactor through the dehrineralizer and fecdwater heaters by motor-driven condensate aad condensate booster pumps and turbinc4riven reactor feed pumps.The tuibiae-generator pleat uiB be comp)cte with auxiTiary systems, pump, co" tro's, wrumentarioa, e!ectric switc-gcar and fire pro:ection equipnen'hc gcnaator e)ectrieal output will be transnritted by isolated.phase bus dua to three single.phase main step.up trans.ernie, e transfomters, each havLig a raring o'.380,000 kVA.wheh roe the vohage from 25 kV:o 500 kV for transmission. A)to)nc)uded<<iB be onc sprc single-phase uxs!orner of ritc sane ntmg.I i~>'er Fcmpuousc which proiidcs condenser oeoBag<<<<ter, fire s)>>tcn water aid service auxiBary cooling wa'.er sill be located south oi~>>pL-"t adjs'=t to m cooHng to<<<<a.It<<Ul 48 house thre=)argo vertieJ circa)aring wata pumps totaUing approxim te!y SS3,000 gpm capcity, conp!etc with wa:cr scrcers aud oiher auxBiaries, aad thc 6:c pumps.The coedcaser cooling<<uter uiB discharge from the turbiac-g:aerator building aad retura to the six round mech~!ca)draB cooling towers.hiakcup water to rcp!aee the evaporative losses of thc circulatiag <<ter coolLig s>item<<iB bc obtained from the Columbia River by means of three makeup water pumps.Blouriown from the circularing water sl>>tem<<ill be discharged to thc Co)unbia River do<<ttstream of thc make-up water intake.There<<iL'e a heavyMuty bridge-typ. aane in both thc turbine-generator and area)sting water bui)dings for scrv)ring cyipnient, aad in thc reactor building for handiiag both equipment and fue).A computer will be instsfied in the central control rotxvt for coUecting and analyzing data to aid ia contre)rod positioning, plant operations and p)ant perfonnance analysis.Diesel genera'.ors <<i)i be Iaduded for emergency use ia the cveat of loss of auxiliary power.The diesel generators <<iB bc housed ia a separate concrctc buildiag located adjacent to the reactor bui)ding.The seriice buBding adjacent to thc turb!re-generator aud reactor buihUngs wiU house o)H<<cs, laboratories, locker room, lobby, first~d fs<<Biri~machiac shop and storerooms. Construcrioa Prtricss and Sebkha!a Contmaioa of thc Pro,'~sss started in August, 1972 under a Constn:aion Permit variance granted by thc AEC, pm&msor agency to QeÃRC.The Construaion Pcrnit was granted by thc AEC on hfarch 19, 1973 n which tim"<<ontruaioa of thc res<<mr buBding subsuuaurc uas started.Con-strucrion of the rene)ada of the main phut was started oa hfsy 19, 1973.Erection of thc cont<<bun<<at tassel was stated ia Sep'tembcr, 1973.Coofirg tower cottstruction was started ia April, 1974.Thc instsBation of temporary f&ries is comp!ete.Thc reaaor buiMing substructure has beca compkted and the coatrianent vessel wh)eh rests on it was 83.2%compte as of December 31, 1974.'Ihe substmcturc for thc turbiaageaertor buLiiing has been complacd and sv>rk is now Li pro~oa tku turb'edcst2 mid the waUs of the twbin~erator building.Thc subsuuaure of th-radusste buBding is oonplac and work is starring oa thc suprstruaure. Conaete sork oa the spray ponds and savioc water pump housn is nearLig comp)etioa. KYork has started oa the cooLng touvr bases~>>th circa)ti"8 wa:cr pump hone.'Ihe reaaor vessel is schedu)cd for deUvcry in December, 1975, aad thc turb'"~castor is scha!cled for d<<Every in June, 1975.Thc Proiea is projeaed to be about eight months behind scheMe.The compietioa dates have been<<hanged axerdin Jy.Comm<<rein) oprarion is presatt)y scheduled for Jun I, 1978.Achieve-ment of this date wBI mquLm a sig8icant improv<<meat ia the rate of construaioa progress As of Deeanber 31~1974, ovcfsB onsttrucrion vms<<stinated to bc)3.0 lo complete compared to a schcd u!<<d 38%comp!<<rion under the origina)schcdulc which contemp)aux) a commercial operation dstq of Scptanbcr I, 1977.P~prational tesring is cxpeacd to begin on certain components in June, 1976 and conrinue through November, 1977.Fuel 1<@ding is scheduled for December, 1977, with start-up and power tesring to bc coaduaed prior to hfay I, 1978.The estitnatcd costs shown in Exhibit A arc based oa a conmercia) opcratiag date of Juae I, 1978.!I th)s date Is sigtufimnfiy <<xcccded, the badge)siU have to be IncrcnctL Coastmction Costs ead Coustmcrion Contracts The to:al esturated project coastmetioa cost of the)tcrr4 under Barns and Roc's scop of reipon-siMhy as En@'" er, Contrucrion and Quality Assur ce hfanager is 5447,416,800 as showa in deiail in Exhibh A aaaehcd to this)atcr.Thc capital cost csrimatc covers aB nudear elearic gencraring plant cqvcpnent and construaion up to and Iae)ud."ng the main step.up transformers, Bwa aad Roe cni,N<<rin, consuuefitn U qu'y ns~naiagemc ty shc consu)tantsy and sales taxy<<onringency and csn)arion appfimbin to the domn~ritnetL Nuclear."w)anl.own:r's coax arc not InJ~in Exh!gt A.It sho id be noM t".t the~~'ion costs have now bcca distributed ia thc tUrea co<<sL~rion cost to nak it agre<<<<ith the Washing'ub~a Powa Supp!y System amouaring system.49 Thc total costs of equipment and construction conuacts awarded to December 31, 1974 rc she<<a oa Exhibit B awaehed to thc lcncr.As no!cd oa this exhibit these coatmcts to~ig 5258,05$,567, include provision for escalation. The amounts for these contracts total approximately 74.6~v of the currcatly estimated total direct construction and equipment costs including escahtion but exclusive of engineering, consuvcdoa management, and conthgencies. 'Ihc two largest cquipmeat cont!ace uvre awarded for thc furnishing of So nuclear steam supply s)stem to General Electri Company m d for the n"bine genera!et! to KVcsringhousc Ehctiic Corporarion. The presert contract prices a:e 544,060,100 and$35,074,126. rcspecdrcly. The nuclear stcam supply six!em contract covers thc furnishing of a conventional boiling<<<<ter rex!or, comphte<<iih prcssure vessel and ail rehtcd pumps, controls and other equipment as normally furnished by Ge"-ral Ehctric Company to the eieetric uriihy indusuy.The KVcsdnghouse contract conrs thc fora~in!g of a turbhc geacrator complc;c uith aB appurtenances to uuTizc th=output s:eam from the ruelear sieam supply system to generate approximateiy 1,100,000 hlowatts of eicctricity. Dae to thc long cn~wcering aad fabricadion schedule for these item, they u'ere awarded early ia the project progt~to meet t" sched sled piaat construction and operation date Thc major concrete construction contract for the reactor building, turbine-gen ratoi build-ing, diesel-generator buildiag, radioacun waste building and service buildhig was awarded to Banc aad Crail Coastrucdon Company on hbrch 20, 1973, and thc present contract price is$32,749/76, The mcchanica! equipmcnt mid piping bstallation oonir ct for the main phut was awarded to a job!veau:ic, Bone M Crafl Constmction Company-Geneml Encry Resources, inc.on I by 10, 1974, and thc present contract price is$60,094,374. AII contracts<<arc a<<<<:ded oa&basis of compcntivc bidd<<mg.The coarct a<<u4 uc.made on thc bash of thc bidder's cxperieace, quaLGcatitm, avsihb!c persoaael and fMidcs as<<all as price consideradions. In ou.opiaion, the vendots and conte<ra eche!cd are ail rcspont3sh a"d well quahged fbms for the particular rJpe of<<'o:k to bc performed. EscalatIon and Contingencies As stated previously, the provision for escalation has aow beca distributed ia thc con!true<<on costs as shown ia Exhibit A.Exhibi!B shows those conwacts for v'hich cicahdion proiisions have bccn contractually made aloag<<5th thc amount proc-'ed in tbe budget for those comracts.Ia addition, pro.vision is incladed fn Exhibit A for escalation for cont~ts not as yei awardeL An addirionai atlommcc of$26,478Q00<<m b;hded ia thc estimated capital cos!to corer uaforeseea contiagcacy item<<hich may be nccessa~as the dctaih of design arc furWr dcn!oped end as construcrion progresses. It h our considered opia:on, with respect to the Project, thfti 1.The piesent phns and desiga are suitable for the site, and thc site is sod!table for thc projem.2.Thc program for construcriion is realistic and a commercial opmtion date of June I, 197S has a reasonable chance of achicvcmen!. However, it vill require a signigcant iinprovement ia thc rate of constriicrion progress 3.'Ibe work uithia m scop: of our rcsponsibTihy <<ill be completed withia thc present cost estimate provided the daic of commercial operarion is noi dehycd si~ntiy beyond Juac I, 1978.Ia the cvcnt iiat this date is sigai5candy exceeded, thc budget<<ill have to be Increased. 4.There arc no major enynecring or construction probkm assoriated with the Project that requir any uatricd design methods.5.Thc Pro,'xt is feasible from an cn jinccring aad construcdon standpo', is of accept-abh commercial desiga and caa be cxpectcd to operate regably<<itb rema)mrintenanw. 6.The description of the Project aad the statcmeats aad summaries ot our estinates which appear in the 06icf J Sta!emcnt to which thh report is an cxhbit are correct and in coa-formity<<itis, and a fa'r and adequate presentation of, the infor anon b ths report.V'e have revi<<nd tbe Project description and capimi cost estimate submit:ed by R.1V.Beck aad Associates ia their report dated hfarch I, 1975, and corZtm that theso~ately rcQec!the Project and its cons bsofar as they rehte to th Bems specigcd herrin which are withh ih soope of rcsponsMIT of Bum aad Roc, Irc.Very tmly you>, K.A.Roa Prcsfdeai ard Chasm of rAe Boarrf Conclusions Thc project<<ill include a boiling water reactor of provea dcsiga famished by the Geaeral Eiccuic Company-a reactor type already in use ia, under construcdon or planned for maay hrge commercial udiity iasmUations. Thc reiaainder of thc phut is gcnerNy sinufar fn design to convcn tonal thermal ph"ts except for thc special considerations that are rehied m usbg steam from a boiling<<uter reactor, aad the compo" eats dupidcate or arc very s~to, thorn v:hich arc now ia sucnssbl commcrrial opera-uon.Vfe have cxambcd the plant eqmpment cs to its feasibTiity, rcUabiuty a" d mrin:enance char~~Isdcs.iVc deter~ed that the proposed or contemphmd item of eqtdpmert are<<"a of prcsengy ptovcn thsfgn or remo&h cxtens:Om of s&&ps.50 E]iB]BIT h KSIEtfATKD PROJKCP COYSIRUC]10]I COST Co.'tsraucT'oA CosTs Suwturcs a"-d Improvements Rector Plant Etpdpmeat Tarbo Generator Uaits Accessory E]ectdcal Et]uipmett .hdscellanoous Potcur P]aat Equipment.................... Stadoa Et]tdpmcnt Temporary Coastrucdoa Feei]iYies ....................... Subtos~suucdoa Costs.......:........... Octot>cr, t 974 5 63,040,700 112,443/00 101.34$,$00 27,760,700 ],4S7,500 6,037,900 3,553,000 5315,668,810 ttcccmbcr. 't O74 5 64,624,500 128,697,900 108,003,000 30,999,900 2,779 900 6,643,100 4,>SS,SM 3343,S29,1M111 Subtotal.Esedadon Coadngcacy Tom]Esdmatcd Project Consuucdon Cast.386,022,000 3",59$,400 28,799,400 420,938,610 (I)26,47S,'200 8'474163M SM7456800 (I]Tbo atra]otic>o ttas bccc 4$5553buMd Ia du~erato to mate it theo 309h tho w~psttcio potrcr Supply Syttcm~S ayttc522.Orttata Datncr Cosrs Sales Tat5%~............ S 15;]83,500 5 17,291,500 Eag]needng am]Miga Coastrucdoa hfanagcmcnt, Site Co"=su]rants aad Qua]:y Assurance 54+69,700 S7,818,000 hrr"WdptojM KS]uipmcnt md Coasuucdon Cort.-cts (As of Dccembcr 31, 1974)prcccat Gwead AoSosSot S 35,074,]26 54,160,]00(l) 3,249,016 2,817,842 2,020,003 1,56$,464 hutSNtor Westinghouse Gcaeral E]ecuic Westinghouse Southwestern Eag.Asa, Inc.BotTc gc Crail Const.Corp.ltfarley Corp.S:etratt-Erichtoa PDM Sted Co.Whidug Corp, Bovec 8: Crall Const.Corp.Wdvsxt&Co, Revvatt and Stevenson Vdan Vdvc Corp.PDM S:ecl Co.Bovee 45 Cra]I Coast.Corp4-Gcn. Eaergy Resoua0es lnc.Thc Waldinger Corp.General Electric Okoa!tc Raychem hfchfiUan Bros.Coatract AS>ard Data 5/2/67 3/23/71 I/14/72 I/14/72 7/14/72 7/24/72 stem Turbine Gcncrator 8 A~sodas......Nuclear Steam Supply S]Ttem.........Cordeatcr and Auxiliadcs ........... Peedkwter Heaters................. Maa Step.Up Trantfcumets .......... Temporary Facdides................ Gehng Tatters.....,...... Reactor Bldg.Subsuucture .........,.eat Vcssd.......... Turbine Rooni lh~~r BMg.Cranes 9/22/72 10/20/72 10/20/72 3/9/73 3/30/73 7,259,150 2,434,1]3 8,496,801 1,040,515 32,749+76 Standard Cast or Forged Stud Vo]vea...Diesel Ge-"<<rotors ................. Nudear Valves............,... Structurd Sled hfch.Quip.Ias>>ladon........7/13/73 7/13/73 12/3/73 3/12/74 5/10/74],617,266 I>254,566 1,418,596 4,119,753 69,364,374(2) HVAC g.Plumbing Iastd]anon Btsuumentadon and Conuo]Bo>>s E]eetdca]Cable.........E]ecuica]Cable.........hf tc UP Water Pump House..Other Msce]]ament 5/10/74 6/17/74 7/9/74 7/9/74 12/27/74 5,508,695 I 360.850 649,944 2,218,009(3) 3,551,869 16,127939"535.058667~<28>1>l~42-3MMM 420~~(Ii I I'l>.IMSS>7 0)~$]OI>7CO 45du6ucd$2 53 E'.(IUBIT IV OPTIONS OF COUNSEL[LETTERHEAD OF WOOD DAWSON LOVE 6: SABATQIEj P.EITERHEAD OF HOUGHTON CLUCK COUGHLD(fe RILEY)Boa<of Directors Washington Pubgc Po<<er Supply S)v:em Rtc~dssd, Wasaasgtos ..., 1975 We h.ve ex~cd th.Comdmsos asd statutes of thc State of Wasbfsa~, and certLaed eop!es cf proeeeKngs of the BoM of Dheetors of the S)x:em authorir!ng the Issuance of said Iesds, Including thc Bond Reso'.rtion, other proofs re!sting m taa issuance of saM bonds aml as executed ooupos bosd of s-rd seder.In our opisios, thc System is a municipal corporation of thc State cf Washhrgtos, duly created asd va!My cxht!"g;thc Bond Resolution has bus duly adopted asd thc pmvhoss thereof arc vaM~bin&g upos the System, end saiC'bonds have bees duly authorise and issred is mMasec<<!th thc CossEitudos and sts'.utes cf the Sts:e of Washhrgton ard cossututc valid aA Ieg Jly b!sdisg ob>Jgsdons of the System payah!c so':!y from the funds tmd raven es as set fosh asd pmvidal is thc Bond Reso!udos os a paity<<fth thc System's presently outstanding Wmaasgtos Pubhc Po<<vr Supply System NuJesr Project No.2 Revenue Bonds, Sedcs 1973, Series 197C and Series 1974 A, and any bonds heres!ter Its&os a psi:y t em<<5th pursuant to the Bond Ress!utios. It is also our opt"ros that t" a interest os said bonds is exempt from taxatios by taa: Us!M Sass of A-erha usa r exiting la<<w and regulat!ass ""d spec!go~rr gs issaA by the Istaa~J Revenue SaVu<<5th rcspcct to sshI bo" ds, daM Novcmb:r 18, 1970, a" d November 30, 1972.Dmr Sirs: WASHDiGTON PUBLIC POINTER SUPPLY SYSIEhf NUCLEAR PROJECI'NO. 2 REVENUE BONDS>SERIES 1975 A,$125>000>000 At Juor retires!.<<c have cxamin>M in:o thc suMty o!$125.000,000 Washhrg.os PuM!c Porrer Supply System Nuclear Project No.2 Revenue Bonds, Series 1975 A, ot Wes<<Jngtos P"bR Pov>'er Supply S)mem (thc"S)x:em"), a municipal corporation of the S'tate of IVash'ngtos. Said beads am issuable is coupon form, registrab!e as to pdseipsI cmly, is thc denomination of$5,000 each, asd is fully regis:ered form,<<dthout coupons, is the demrwaatioss of$5,000 or r u!tip!os thercoL Thc coupon bonds are numbered from I up<<uW and arc dated hfareh I, 1975.The fu>Jy reghtcred bonds arc numbeel from R-I upwards and, except fully regis:ared bonds isiiia!iy issued,<<Meh arc dated hf arch I, 1975, shall be dated so t"at so ga!s or loss of interest shsQ ress!t from exch""ges or transfers the~f as prorMed there!s and is thc Bond Rescinder hem~ter menurmerL Said bonds mar~on July I is each of thc pars asd Is thc amounts a"d bear istemst, payab!o Ju!y I, 1975, aud semi-aausL>ta rgtterosJanu I&Jul l,asfo!!owst y y tarriest let>tart Year Araaeat Rara Year Arr>oaat Rara Md bor4 src subu to redemption prior to matvrity upon thc terms snd eosdidons set forth there!s, asd recite that dray are issued under asd pursuant to R~Iuthrs No.640, adop:ed by taa: Board of Directors of thc System os thc 26th dsy of Junc, 1973, and a resolu Jos supplemental thereto, Reso!utica No....., adopted by said Board os......., 1975 (here!rafter referred to colleedvely as the"Bond Resoiudios"). and urdar the authority of asd is full eosrplia."m vdth th-Constitution asd statum of thc Sta:c of Washing!on, Including Tides 43 md 5C of thc Revis<Code of KVashiagtos, for the purpose of aetiui~sg. by purchase or condemn t!on, and eonsnuetisg s sr Cea eleesic gererau" 5 p!art asd msoeiated f~r'des as a sepctmm utiii:y s)stem constituting asd to b.Imo<<n as tim Washingms PubEc Po<<ur Supply System Nu Jeer Projem No.>55 [LEITERIIEAD OF WOOD DAWSON LOVE P SABATLx(E[ [LEITERHEAD OF HOUGHTON CLUCK COUGHLD(tjx RILEY]Board of Dircmors Washiagton PubUc Power Supply System Richland, Wmbjngton......, 197$WASHPNGTON PUBLIC POIVER SUPPLY SYSIESI NUCLEAR PROJECP NO.2 REVE.aUE BONDS, SERIES 197$A, 512$>000,000 0 Under the date ot............, 1975, wc rendered an opinion ppprovjng thc vnhdity of ihc above bonds (the"Bonds")issued pursuant to rcsoludons adopted by the Board of Directors of thc tVashjng.on Public Poiver Supply S>stem (the"S>xtem")on June 26, 1973 and March 6, 1975 (eoUectivcly, the Bond ResolilUion ), tVo have examined into the validity of the project Afxecment (Camtrnet No.f443-19121), dated January 4, 1971, between tho United States of Amerfm, Di~cnt of thc Interior, acting by mid through thc BonnexiUe po<<vr Administrator, and Was)dng(on pubUe power Supply System, referred to on page 24 of the 0!Ueial Siatcmcnt of the S>x;em, dated March 6, 1975.relating to the Boi:ds.IVith respect to thc authorization, ex:cation a."3 dchvery ot szhf ngrcemcnt, wc have cznmivavf eer iced copb of proevxfings of ihc Boz:d of Director of the S>stem authoiiring the execvrion 2nd delivery ot aid agreement, nnd such other documents. proeccdings and maners relating to thc nuthorimtjon, cxeeuriion and deUvery of said agreement b>each of the parties thereto ns<<u deemed rejexmh In our opinhxa, szM agreement hzs been duly nuthorizcd, cxea::ed and delivered by each of rite parties thereto and comtitutes n valid nnd binding agreement enforce" blc bx accordance with is terms.'tVo have also examined into thc v<<Udity o(............ of tbe¹t BiUing h-eemcnts, rc(erred to on page 21 of ari 0!Ueizj Statement, among the United Smtcs of America, Department of tho In'.crior, acting by nnd through the Bon"miUc Power AdmiYist.tor, thc S>vtem, 2nd c stain of the PzrtiYipsnts.referred to in Exhibit I of s"id 0!Ucial Statement, u hich.......... agreements proiide for the purchase aud assignment of an aggregate of......ic of the czpnbUhy o(the Project, ns such project is defined in thc Bond Rcsolupion, nnd i"elude aU such Nct BUUng Agreements provMing for the purchase nnd nssignmcnt by any Participant of more th n....9c ot thc eapnbUity of thc Projea.W th respect to ihc nuthorization, execution and dehvery of said.......... I(et Billing Agrecn its,<<e have examined certi8%copies ot proeeeChngs of tbc S>stem nnd of the Pnnieipzns which are pzttj thereto, author Yiing thc execution and delivery of said........Net BUling Agreements, and such other docun.cnts, proceedings nnd matters relating to thc nuthorizatjpn, exec-tion and delivery of said..........Net BUling Agreements by each of the parties thereto ns<<u deemed rclcvank ln our opinion, e eh of said........Hct Biliin Agreemcms has been duly authorized, executed and delivered by each of the parties thereto and eontdtutes a v~vd and binding agreement, enforccsblc in accordance <<ith is'ternis.In renderin this ophdon, v:c have rcUed upon ihc opinion of counsel for each of thc Pzltjefpans that tho 1(ct BU!in Agreement to wHch such Paacipznt is par:y hzs b'n duly execu:ed and delivered by ari Parricipant and is not Ln eo."Mc<<ith, or M viola'.', and<<SU not be a breach of, or constitute a dc(suit under, tho terms a" 6 eondirions of may other agent o: commitment by which svch pzwpat fs bound.Very n cjy>vxure, BO<<vs~LE POI>'ER AD>ID(ISXRATION Projected Revenues (I mtmcux)BPA Coat ot ptxcat Opcrxdcn Puavhxxc Surplus Veer~ad~ad Avxtkbk rcr Eudtcg BPA Matctcuaucc Exchxxxc¹tBPA%ppSSNo 2 pxymcutioxbc Jane 30~LAI~EI11 K I R~Bll'II.L 1975.........225.6 42.1 31$t 1$1.6 0.0 151.6 1976.........296.0 45.6 31.1 219.3 0.0 219.3 1977.........312.5 49.0 29.9 233.6 25.0 208.6 1978.........330A 49.9 24.9 2$$.6 703 185.3 1979.........364.6 51.6 23.2 289.8 70.3 219.5 1980.........484.3 54.1 127.3 302.9 70.3 232.6 1981.........489.1 55.6 211.3 222.2 703 151.9 1982.........497.6$6.1 211.1 230.4 70.3 160.1 1983.........525.$$6,9 211.4 257.2 70.3 186.9 19S4.........527.8 578 210.9 259A 70.3 IS9.1 19SS.........S26.4 57.6 210.9 2$7.9 70.3 187.6 1986.........527.3 57.6 210.9 2$S.S 70.3 1888 1987,.~~~...~526 5 57 9 2109 2$7.7 70.3 187.4 1988.........535.9 SS.4 210.7 266.S 70.3 1965 1989.......~~534.6 58.6 21'LO 264.0 70.3 193.7 1990.........533 I 59 I 2105263 5 703 193 2 1991......".5404 598 2072 273 7 70.3 203 4 1992.........$39.S 59.6 206.6 273.6 70.3 2033 1993.........$37.8$9.6 206.6 271.6 70.3 201.3 (l)Bcvauucx are baird ou ucw pouvr whotcxxk rxicx cfacxivc t>cccmbcr 20, 7974 aad an aariYipxtcd rxic lecrcxic of 30%ta nims, year l9so.Thcic rcvcaucx do uot (uctudc BpA rcvcuucx<<bjch wnt result from thc xxtc of thc addtiNuxxt rcaourccx a<<tetrad from Wp PSS Nuckxr pro)cctx Nox I aad 3.(2)1>ocx act juctudc axy cat!matc of BPA'c avavrxtjon and mxkicaxccc cxPcuxex for xmmhxion fxcnmcx xxxoctxtcd with WPPSS Nudcxr Pio';ccu Ncx.l aud 3.(3)Thc coat io Bph ot xcquhiug thermal power through nat bgnug xgrccmcuix for (a)ihc Hxnford project, (b)thc Tmjin Nuclear prujccn cad (c)xhc Wxxhtcgrou pubti powc.Supply System Nudcxr projccu Nox.I xad 3.Bph'c tuymceii thrwugh zci bmicg (or Trojan power cummcaccd la lxuuxiy ut l974, aud will couuucucc (cr thc WppSS Nu kxr project No.l tn Jaeuxry l9gn.aad Nuckxr prcjam 7'o.3 tu lxuuxry lsgt.(4)BpA Rcavaucx m(cex BpA Opcrxiko aud St'niccxucc Bxpcuxcx xmt Coat u(pcrchxic and Exehxugc power.(5)Nci bjniug tcc ihc project witt bcs(a no ktcr than scpnmbcr k l977.Any cmoucix uot px!d ihrcczh nat~~'r:m x;c p yxb:c from t'c BPA peed on a purity xdk SPA Cpu!scca anz htxn n xacc Expcexc aud ccct of purchxm ced~Puwcn$6 57 United States Department of the Interior BOXikTV!ILK POWER ADJUIXISTRATION rA sex kku.reelsAM esrctkv kuks oI/Ice on Tll~AO TIKI vknk ken In reply refer toi XORS Nokumb<<12, 1974'O: hfa.yxcc J.grant hfcr"ging Director IVxstmvoro'4 Puattc Powaa Sugar Srsxxw P.O.Box 968 Richland.KVashingmn 99352 All PmtiYipants in WPPSS Nucle~Projects¹>>.I, 2 and 3 W thc Trojan Proj<<t¹t BUUng Agrccments GcnUcment The Supply System is p!eaning to issue an addition J$125 mUion of long term bends to Seance the consttumion of its Nudear Project No.2.BonneviL'e, as in th past, is coopcradng <<5th the Supply System and its financial advisors ia piquing the OIUeiaI Stateinent end other suppotung documentation which arc re!xted to the Issue.As the result of thc ensmment of tbe Federal Co!umbia River Tyansmission Syste~Act (Pub.I No.93S54)there has l>>en sigrdUcant improvement ht the overall security aUorded thc ho!ders of aU bonds issued or to be issued by the Supply System for Nuclear projems Nos.I, 2 and 3 aud by the City of Eugene for thc Trojan project.Und:r the proviuons of the Transndssion S)stem Act BonnckiUe now has the authority to use its revenues deposited ia the Bonnekille Power Adnunhtmdion Fund (Fund)"without further appropriatioa" of Congress"for any purposes necessary or appropriate to carry out the dudes imposed upon the Admirdszator pursuant to lsw, Indudiag... (6)purchme of electric power (Inciudhkg thc entitIement of eiceuic p!ant crpabhsty) ...if such purchase hss been hcrctofoto a thorized.:.." In any year ia which ret biUiag credits may be Insu!U.":cnt to ofset thc aa:ouats ovkud to any part Ykpmkt these costs wouM bc paid from thc Fund oa a parity ufth other BonnciiUc opetaung expenses aad pdor to any psymeats by Bc~ki'!c to the Tr<<sary for reps)ent of (I)thc Federal Inkustment in thc Federal Columbia River System (2)Corps ov En@a~ad Bureau of Rcclamatioa costs conn<<ted with such spital, and (3)btmds Issued by Bonnek J!c under thc Act.BonneviUc's actiuiYidcm of txe cspxbihty of such pro)<<ts as p-c of the H!pro-Ther=xi Power Progr~ww exprcsslv approved by Corgrcss In the Appropdadon Acts of 1970~1971.Bounek@c, in accordance with the provisions of the TransmMon S>stem Act, wui psy in cash from the Fuad oa a psdty with oU:<<BoaacviUc opcradng expenses any costs biUed to thc PemYkpants for Supply System Nuciem Pioje<<s Nos.I, 2 and 3 mtd th-City of Eugcnc's ss-of m Trojan Pro j<<t w~~are not pahI through nrt biL'hg credits.Sh<<rc!y,/s/Dovxtrk Pxt't finnan'~druutor 58 EXHIBIT B REVENUE BOND SALE WASHINGTON PUBLIC POWER SUPPLY SYSTEM l