Preliminary Cost Estimate. (a) The Generator has provided to the Counterparty, prior to the date hereof, a preliminary Basis of Estimate Report for the First Unit. Such preliminary Basis of Estimate Report consists of a detailed breakdown of the estimated costs for the Refurbishment Work and the applicable One-Time Costs for the First Unit and describes the basis for the costs for each work breakdown item and the risk associated with that cost. The preliminary Basis of Estimate Report also includes a detailed work plan to develop the Fully-Scoped Refurbishment Cost and the Fully-Scoped Refurbishment Duration by the scheduled Refurbishment Lock-in Date of the First Unit. The Counterparty acknowledges receipt of such preliminary Basis of Estimate Report in form and scope acceptable to it. On or prior to December 31 of each year after the Effective Time and prior to the Refurbishment Lock-in Date of the First Unit, the Generator will update such preliminary Basis of Estimate Report and work plan for such Unit and will deliver to the Counterparty an updated Base Estimate and Contingency determined in accordance with Section 2.6 for the Refurbishment Work for such Unit. (b) Not later than thirty-six (36) months prior to the Scheduled Refurbishment Outage Date of each Unit to be Refurbished after the First Unit, the Generator will deliver to the Counterparty a Base Estimate and Contingency determined in accordance with Section 2.6, for the Refurbishment Work for such Unit. This estimate will consist of a detailed breakdown of the estimated costs for the Refurbishment Work and the applicable One-Time Costs for such Unit, including a preliminary Basis of Estimate Report that clearly describes the basis for the costs for each work breakdown item and the risk associated with that cost. Such estimate will also include a detailed work plan to develop the Fully-Scoped Refurbishment Cost and the Fully-Scoped Refurbishment Duration by the scheduled Refurbishment Lock-in Date of such Unit. On or prior to each anniversary of the date on which the preliminary Basis of Estimate Report is delivered in respect of each subsequent Unit to be Refurbished after the First Unit, until the Refurbishment Lock-in Date of such Unit, the Generator will deliver to the Counterparty an update of the preliminary Basis of Estimate Report and plan for developing the Fully-Scoped Refurbishment Cost and the Fully-Scoped Refurbishment Duration for such Unit. (c) During the preparation of any Basis of Estimate Report or update thereof in respect of a Unit to be Refurbished and for which there is an Adjusted Prior Unit Cost, the Generator will, upon determining with reasonable certainty that a Prior Unit Cost Divergence or a Prior Unit Duration Divergence exists, provide the Counterparty with notice thereof, and as soon as reasonably practicable thereafter and, in any event, not later than the Refurbishment Lock-In Date of such Unit, a reasonably detailed explanation of the cause and anticipated effect of each such Prior Unit Cost Divergence and Prior Unit Duration Divergence on the Adjusted Prior Unit Cost, the Adjusted Prior Unit Duration, or both, of the applicable Unit and a reasonably detailed explanation as to why such Prior Unit Cost Divergence or Prior Unit Duration Divergence, as applicable, is reasonable in the circumstances. Without limitation of the generality of the foregoing: (i) in respect of each Prior Unit Cost Divergence specified in clause (d) of the definition of Adjusted Prior Unit Cost, if any, that the Generator has determined is Beneficial to the Ratepayer, the Generator will provide the Counterparty with a detailed description to demonstrate why the Generator has determined that the change is Beneficial to the Ratepayer, including reasonable details of all corresponding changes proposed to be made to the then current Financial Model, including the relevant Inputs thereto, and in respect of each Prior Unit Cost Divergence that the Generator undertakes or commits to undertake for the primary purpose of reducing the expected Refurbishment Duration for such Unit, a detailed description of the trade-off that is being made between cost and duration, including reasonable details of all corresponding changes proposed to be made to the then current Financial Model, including the relevant Inputs thereto; and (ii) in respect of each Prior Unit Duration Divergence specified in clause (d) of the definition of Adjusted Prior Unit Duration, if any, that the Generator has determined is Beneficial to the Ratepayer, the Generator will provide the Counterparty with a detailed description to demonstrate why the Generator has determined that the change is Beneficial to the Ratepayer, including reasonable details of all corresponding changes to the then current Financial Model, including the relevant Inputs thereto. The Counterparty may within ten (10) days of receipt of a notice of a Prior Unit Cost Divergence or a Prior Unit Duration Divergence, request reasonable additional information. The Generator shall provide such reasonable additional information as is available to it within ten (10) days of receipt of such request. (d) The Generator will not be entitled to a Prior Unit Cost Divergence specified in clause (d) of the definition of Adjusted Prior Unit Cost unless the change is Beneficial to the Ratepayer. The Generator will not be entitled to a Prior Unit Duration Divergence specified in clause (d) of the definition of Adjusted Prior Unit Duration unless the change is Beneficial to the Ratepayer. If the Counterparty disagrees that a change specified in clause (d) of the definition of Adjusted Prior Unit Cost or clause (d) of the definition of Adjusted Prior Unit Duration is Beneficial to the Ratepayer, it shall so notify the Generator by the 30th day after the Generator has provided the applicable information contemplated by Section 2.4(c)(i) or 2.4(c)(ii), as the case may be, together with a reasonably detailed explanation of why the Counterparty disagrees. If the Generator, in turn, provides notice of dispute (a “Generator Accelerated Dispute Notice”) within fourteen (14) days of receipt of the Counterparty’s notice, the dispute shall be resolved in accordance with Accelerated Dispute Resolution pursuant to Exhibit 2.4(d) and the issues for determination in such dispute will be limited to whether such Prior Unit Cost Divergence or Prior Unit Duration Divergence is Beneficial to the Ratepayer and, if so, the amount of such Prior Unit Cost Divergence or Prior Unit Duration Divergence. Such Generator Accelerated Dispute Notice must describe the nature of the dispute in reasonable detail in order that the Counterparty is able to provide the “Counterparty Decision Reasons” in accordance with Exhibit 2.4(d). If the Counterparty does not deliver its notice of disagreement to the Generator within such 30 day period it will be deemed to have agreed that such change is Beneficial to the Ratepayer. If a Generator Accelerated Dispute Notice is not delivered to the Counterparty within such 14 day period, the Generator will be deemed to have agreed that such change is not Beneficial to the Ratepayer. (e) In respect of any Prior Unit Cost Divergence specified in clause (h) of the definition of Adjusted Prior Unit Cost or any Prior Unit Duration Divergence specified in clause (g) of the definition of Adjusted Prior Unit Duration, the Generator will not be entitled to such divergence unless such divergence is beyond the Generator’s reasonable control and the Counterparty has approved that such is the case, which approval shall not be unreasonably withheld. If the Counterparty withholds its approval to a change specified in clause (h) of the definition of Adjusted Prior Unit Cost or a change specified in clause (g) of the definition of Adjusted Prior Unit Duration it shall so notify the Generator by the 30th day after the Generator has provided the reasonably detailed explanation contemplated by Section 2.4(c), together with a reasonably detailed explanation of why the Counterparty is withholding its approval. If the Generator, in turn, provides a Generator Accelerated Dispute Notice within fourteen (14) days of receipt of the Counterparty’s notice, the dispute shall be resolved in accordance with Accelerated Dispute Resolution pursuant to Exhibit 2.4(d) and the issues for determination in such dispute will be limited to whether such Prior Unit Cost Divergence or Prior Unit Duration Divergence is beyond the Generator’s reasonable control and, if so, the amount of such Prior Unit Cost Divergence or Prior Unit Duration Divergence which shall be determined in accordance with Accelerated Dispute Resolution pursuant to Exhibit 2.4(d). Such Generator Accelerated Dispute Notice shall describe the nature of the dispute in reasonable detail in order that the Counterparty is able to provide the “Counterparty Decision Reasons” in accordance with Exhibit 2.4(d). If the Counterparty does not provide such approval to the Generator within such 30 day period it will be deemed to have approved such change. If a Generator Accelerated Dispute Notice is not delivered to the Counterparty within such 14 day period, the Generator will be deemed not to have disputed the Counterparty’s determination to withhold its approval of such divergence in accordance with this Section 2.4(e). The Counterparty acknowledges and agrees that (i) a Discriminatory Action is, by definition, beyond the reasonable control of the Generator except where and to the extent such Discriminatory Action is directed specifically at the Generator in response to, or is implemented specifically to address, an act or omission on the part of the Generator that is contrary to Ontario Laws and Regulations (as such Ontario Laws and Regulations existed prior to such change); and (ii) a Change of Law and the terms and conditions of any permit, certificate, impact assessment, licence, registration, authorization, consent or approval held or necessary to be held by or on behalf of the Generator in connection with a Refurbishment are beyond the reasonable control of the Generator except where and to the extent: (i) the coming into force of such Change of Law was known, or could reasonably have been known, by the Generator as at the date hereof; (ii) the Change of Law was in response to, or is implemented specifically to address, an act or omission on the part of the Generator that is contrary to Laws and Regulations (as such Laws and Regulations existed prior to such change); or (iii) the Change of Law was caused by the Generator’s negligence or willful misconduct. (f) This Section 2.4 shall not apply to any Terminated Unit following any election or deemed election not to proceed with such Terminated Unit in accordance with Article 9 unless either the Generator or the Counterparty elected to proceed with the Refurbishment of such Unit pursuant to Section 9.1(d) or 9.1(e), as the case may be.
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Sources: Bruce Power Refurbishment Implementation Agreement, Bruce Power Refurbishment Implementation Agreement
Preliminary Cost Estimate.
(a) The Generator has provided to the Counterparty, prior to the date hereof, a preliminary Basis of Estimate Report for the First Unit. Such preliminary Basis of Estimate Report consists of a detailed breakdown of the estimated costs for the Refurbishment Work and the applicable One-Time Costs for the First Unit and describes the basis for the costs for each work breakdown item and the risk associated with that cost. The preliminary Basis of Estimate Report also includes a detailed work plan to develop the Fully-Scoped Refurbishment Cost and the Fully-Scoped Refurbishment Duration by the scheduled Refurbishment Lock-in Date of the First Unit. The Counterparty acknowledges receipt of such preliminary Basis of Estimate Report in form and scope acceptable to it. On or prior to December 31 of each year after the Effective Time and prior to the Refurbishment Lock-in Date of the First Unit, the Generator will update such preliminary Basis of Estimate Report and work plan for such Unit and will deliver to the Counterparty an updated Base Estimate and Contingency determined in accordance with Section 2.6 for the Refurbishment Work for such Unit.
(b) Not later than thirty-six (36) months prior to the Scheduled Refurbishment Outage Date of each Unit to be Refurbished after the First Unit, the Generator will deliver to the Counterparty a Base Estimate and Contingency determined in accordance with Section 2.6, for the Refurbishment Work for such Unit. This estimate will consist of a detailed breakdown of the estimated costs for the Refurbishment Work and the applicable One-Time Costs for such Unit, including a preliminary Basis of Estimate Report that clearly describes the basis for the costs for each work breakdown item and the risk associated with that cost. Such estimate will also include a detailed work plan to develop the Fully-Scoped Refurbishment Cost and the Fully-Scoped Refurbishment Duration by the scheduled Refurbishment Lock-in Date of such Unit. On or prior to each anniversary of the date on which the preliminary Basis of Estimate Report is delivered in respect of each subsequent Unit to be Refurbished after the First Unit, until the Refurbishment Lock-in Date of such Unit, the Generator will deliver to the Counterparty an update of the preliminary Basis of Estimate Report and plan for developing the Fully-Scoped Refurbishment Cost and the Fully-Scoped Refurbishment Duration for such Unit.
(c) During the preparation of any Basis of Estimate Report or update thereof in respect of a Unit to be Refurbished and for which there is an Adjusted Prior Unit Cost, the Generator will, upon determining with reasonable certainty that a Prior Unit Cost Divergence or a Prior Unit Duration Divergence exists, provide the Counterparty with notice thereof, and as soon as reasonably practicable thereafter and, in any event, not later than the Refurbishment Lock-In Date of such Unit, a reasonably detailed explanation of the cause and anticipated effect of each such Prior Unit Cost Divergence and Prior Unit Duration Divergence on the Adjusted Prior Unit Cost, the Adjusted Prior Unit Duration, or both, of the applicable Unit and a reasonably detailed explanation as to why such Prior Unit Cost Divergence or Prior Unit Duration Divergence, as applicable, is reasonable in the circumstances. Without limitation of the generality of the foregoing:
(i) in respect of each Prior Unit Cost Divergence specified in clause (d) of the definition of Adjusted Prior Unit Cost, if any, that the Generator has determined is Beneficial to the Ratepayer, the Generator will provide the Counterparty with a detailed description to demonstrate why the Generator has determined that the change is Beneficial to the Ratepayer, including reasonable details of all corresponding changes proposed to be made to the then current Financial Model, including the relevant Inputs thereto, and in respect of each Prior Unit Cost Divergence that the Generator undertakes or commits to undertake for the primary purpose of reducing the expected Refurbishment Duration for such Unit, a detailed description of the trade-off that is being made between cost and duration, including reasonable details of all corresponding changes proposed to be made to the then current Financial Model, including the relevant Inputs thereto; and
(ii) in respect of each Prior Unit Duration Divergence specified in clause (d) of the definition of Adjusted Prior Unit Duration, if any, that the Generator has determined is Beneficial to the Ratepayer, the Generator will provide the Counterparty with a detailed description to demonstrate why the Generator has determined that the change is Beneficial to the Ratepayer, including reasonable details of all corresponding changes to the then current Financial Model, including the relevant Inputs thereto. The Counterparty may within ten (10) days of receipt of a notice of a Prior Unit Cost Divergence or a Prior Unit Duration Divergence, request reasonable additional information. The Generator shall provide such reasonable additional information as is available to it within ten (10) days of receipt of such request.
(d) The Generator will not be entitled to a Prior Unit Cost Divergence specified in clause (d) of the definition of Adjusted Prior Unit Cost unless the change is Beneficial to the Ratepayer. The Generator will not be entitled to a Prior Unit Duration Divergence specified in clause (d) of the definition of Adjusted Prior Unit Duration unless the change is Beneficial to the Ratepayer. If the Counterparty disagrees that a change specified in clause (d) of the definition of Adjusted Prior Unit Cost or clause (d) of the definition of Adjusted Prior Unit Duration is Beneficial to the Ratepayer, it shall so notify the Generator by the 30th day after the Generator has provided the applicable information contemplated by Section 2.4(c)(i) or 2.4(c)(ii), as the case may be, together with a reasonably detailed explanation of why the Counterparty disagrees. If the Generator, in turn, provides notice of dispute (a “Generator Accelerated Dispute Notice”) within fourteen (14) days of receipt of the Counterparty’s notice, the dispute shall be resolved in accordance with Accelerated Dispute Resolution pursuant to Exhibit 2.4(d) and the issues for determination in such dispute will be limited to whether such Prior Unit Cost Divergence or Prior Unit Duration Divergence is Beneficial to the Ratepayer and, if so, the amount of such Prior Unit Cost Divergence or Prior Unit Duration Divergence. Such Generator Accelerated Dispute Notice must describe the nature of the dispute in reasonable detail in order that the Counterparty is able to provide the “Counterparty Decision Reasons” in accordance with Exhibit 2.4(d). If the Counterparty does not deliver its notice of disagreement to the Generator within such 30 day period it will be deemed to have agreed that such change is Beneficial to the Ratepayer. If a Generator Accelerated Dispute Notice is not delivered to the Counterparty within such 14 day period, the Generator will be deemed to have agreed that such change is not Beneficial to the Ratepayer.
(e) In respect of any Prior Unit Cost Divergence specified in clause (h) of the definition of Adjusted Prior Unit Cost or any Prior Unit Duration Divergence specified in clause (g) of the definition of Adjusted Prior Unit Duration, the Generator will not be entitled to such divergence unless such divergence is beyond the Generator’s reasonable control and the Counterparty has approved that such is the case, which approval shall not be unreasonably withheld. If the Counterparty withholds its approval to a change specified in clause (h) of the definition of Adjusted Prior Unit Cost or a change specified in clause (g) of the definition of Adjusted Prior Unit Duration it shall so notify the Generator by the 30th day after the Generator has provided the reasonably detailed explanation contemplated by Section 2.4(c), together with a reasonably detailed explanation of why the Counterparty is withholding its approval. If the Generator, in turn, provides a Generator Accelerated Dispute Notice within fourteen (14) days of receipt of the Counterparty’s notice, the dispute shall be resolved in accordance with Accelerated Dispute Resolution pursuant to Exhibit 2.4(d) and the issues for determination in such dispute will be limited to whether such Prior Unit Cost Divergence or Prior Unit Duration Divergence is beyond the Generator’s reasonable control and, if so, the amount of such Prior Unit Cost Divergence or Prior Unit Duration Divergence which shall be determined in accordance with Accelerated Dispute Resolution pursuant to Exhibit 2.4(d). Such Generator Accelerated Dispute Notice shall describe the nature of the dispute in reasonable detail in order that the Counterparty is able to provide the “Counterparty Decision Reasons” in accordance with Exhibit 2.4(d). If the Counterparty does not provide such approval to the Generator within such 30 day period it will be deemed to have approved such change. If a Generator Accelerated Dispute Notice is not delivered to the Counterparty within such 14 day period, the Generator will be deemed not to have disputed the Counterparty’s determination to withhold its approval of such divergence in accordance with this Section 2.4(e). The Counterparty acknowledges and agrees that (i) a Discriminatory Action is, by definition, beyond the reasonable control of the Generator except where and to the extent such Discriminatory Action is directed specifically at the Generator in response to, or is implemented specifically to address, an act or omission on the part of the Generator that is contrary to Ontario Laws and Regulations (as such Ontario Laws and Regulations existed prior to such change); and (ii) a Change of Law and the terms and conditions of any permit, certificate, impact assessment, licence, registration, authorization, consent or approval held or necessary to be held by or on behalf of the Generator in connection with a Refurbishment are beyond the reasonable control of the Generator except where and to the extent:
(i) the coming into force of such Change of Law was known, or could reasonably have been known, by the Generator as at the date hereof; (ii) the Change of Law was in response to, or is implemented specifically to address, an act or omission on the part of the Generator that is contrary to Laws and Regulations (as such Laws and Regulations existed prior to such change); or (iii) the Change of Law was caused by the Generator’s negligence or willful misconduct.
(f) This Section 2.4 shall not apply to any Terminated Unit following any election or deemed election not to proceed with such Terminated Unit in accordance with Article 9 unless either the Generator or the Counterparty elected to proceed with the Refurbishment of such Unit pursuant to Section 9.1(d) or 9.1(e), as the case may be.
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