Standard Form Contract - Schedule PP (NC) NCUC Docket No. E-100, Sub 74
FROM NCSTDPP.FRM (Rev. 6/23/95)
PURCHASED POWER AGREEMENT
-------------------------
between
DUKE POWER, A DIVISION OF DUKE ENERGY CORPORATION
and
MILL SHOALS HYDRO COMPANY, INC.
"High Shoals Hydroelectric Facility"
Contract No. 97-06
Contract Date: -----------------
Initial Delivery Date: ------------------------
PURCHASED POWER AGREEMENT
-------------------------
THIS PURCHASED POWER AGREEMENT ("Agreement") is made this
____ day of _______________, 1997, by and between
DUKE POWER, A DIVISION OF DUKE ENERGY CORPORATION,
a North Carolina Corporation ("Company"), and
MILL SHOALS HYDRO COMPANY, INC.
A DELAWARE Corporation ("Supplier" or "Customer"), for the
"HIGH SHOALS HYDROELECTRIC FACILITY,"
a qualified facility as determined by the Federal Energy Regulatory Commission
pursuant to Section 210 of the Public Utilities Regulatory Policies Act of 1978,
consisting of A SINGLE, VERTICAL SHAFT, ▇▇▇▇▇▇-TYPE TURBINE DIRECTLY COUPLED TO
A SINGLE, 1800 KILOWATT SYNCHRONOUS GENERATOR (the "Facility"), which is located
in ▇▇▇▇▇▇ COUNTY at or near HIGH SHOALS, North
Carolina.
(Hereinafter, the parties are also referred to individually as "Party" and
collectively as "Parties").
In consideration of the mutual covenants herein contained, the
Parties hereto, for themselves, their successors and assigns, do hereby agree to
the following:
1. Service Requirements.
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1.1 The Supplier shall sell and deliver exclusively to the Company all
of the electric power generated by the Facility, net of the Facility's own
auxiliary electrical requirements, and the Company shall purchase, receive, use
and pay for the same, subject to the conditions contained in this Agreement.
Back-up and maintenance power for the Facility's auxiliary electrical
requirements shall be provided to Supplier by the Company pursuant to a separate
electric service agreement under the Company's rate schedule appropriate for
such service.
1.2 The electric power to be delivered hereunder shall be three phase,
alternating, at a frequency of approximately sixty (60) hertz, and at
approximately 4160 volts.
1.3 Delivery of said power shall be made in ▇▇▇▇▇▇ County at or near
HIGH SHOALS, North Carolina at a delivery point described as follows:
AT THE COMPANY'S DISCONNECTING SWITCHES MOUNTED ON THE SUPPLIER'S POLE ON THE
LOW TENSION SIDE OF THE COMPANY'S STEP-UP SUBSTATION AT OR NEAR THE SUPPLIER'S
HIGH SHOALS HYDRO PLANT.
1.4 (a) The nameplate capacity of the Supplier's generating facilities
is 1800 KILOWATTS, consisting of A SINGLE, VERTICAL SHAFT, ▇▇▇▇▇▇-TYPE TURBINE
DIRECTLY COUPLED TO A SINGLE, 1800 KILOWATT SYNCHRONOUS GENERATOR.
(b) The Supplier shall deliver to the Company throughout the
term of the Agreement approximately 900 KILOWATTS during On-Peak Periods as its
"Capacity Commitment" as defined in Paragraph 1.4(c) below.
Page 1 of 8
(c) The "Capacity Commitment" shall be the average capacity in
kilowatts the Supplier commits to deliver to the Company during On-Peak Periods
through the term of the Agreement taking into account scheduled and forced
outages, fuel availability, steam requirements and any other conditions which
might impact the average capacity during On- Peak Hours.
1.5 The Company will install and own such meter(s) as shall be
necessary to measure and record the electrical energy and demand(s) delivered
and received in accordance with the terms and conditions of this Agreement, such
meter(s) to be located:
ON THE HIGH TENSION (12 KV) SIDE OF THE COMPANY'S SUBSTATION.
2. Rate Schedule and Service Regulations. The sale, delivery, and use of
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electric power hereunder, and all services of whatever type to be rendered or
performed in connection therewith, shall in all respects be subject to and in
accordance with all the terms and conditions of the Company's RATE SCHEDULE
PP(NC) ELECTRICITY NO.4, THIRD REVISED LEAF NO.90, 15- YEAR FIXED RATE -
DISTRIBUTION and its Service Regulations, both of which are now on file with the
North Carolina Utilities Commission, and are hereby incorporated by reference
and made a part hereof as though fully set forth herein. Said Service
Regulations are subject to change, revision, alteration or substitution, either
in whole or in part, upon order of said Commission or any other regulatory
authority having jurisdiction, and any such change, revision, alteration or
substitution shall immediately be made a part hereof as though fully written
herein, and shall nullify any prior provision in conflict therewith.
3. Initial Delivery Date.
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3.1 The Initial Delivery Date shall be the first date upon which energy
is generated by the Facility and delivered to the Company, and such energy is
metered by the Company. The Initial Delivery Date under this Agreement is the
SECOND DAY OF APRIL, 1997.
3.2 The Initial Delivery Date must occur no later than 30 months from
the date of execution of this Agreement.
3.3 The initial delivery of electric power is dependent upon the
Company securing from the manufacturers all necessary apparatus, equipment and
material for the delivery of said power, and the Company shall not be required
to receive said power until it shall have secured and installed such equipment,
apparatus and material.
3.4 If either Party shall be delayed or prevented from delivering or
receiving electric power on the Initial Delivery Date by reason of an event or
condition of force majeure as defined in Paragraph 7 hereof, then the Initial
Delivery Date and the beginning of Supplier's obligation to pay Interconnection
Facilities Charges pursuant to Paragraph 5.3 hereof shall be extended for a
period proportionate to such delay or prevention.
4. Term. The term of this Agreement shall be FIFTEEN (15) YEARS beginning with
----
the Initial Delivery Date. The Company shall have the right of termination
provided in the attached Rate Schedule.
This Agreement shall be renewable for subsequent term(s) at the option
of the Company on substantially the same terms and provisions, and at a rate
either (1) mutually agreed upon by the Parties negotiating in good faith and
taking into consideration the Company's then avoided cost rate and other
relevant factors, or (2) if no agreement can be reached in a reasonable time,
set by arbitration.
In the event that this contract is terminated by either Party prior to
the expiration of the initial term the Supplier will reimburse the Company for
the total energy and capacity credits
Page 2 of 8
received in excess of that which would have been received under variable rates,
plus interest at the rate of 8.63% per annum until repaid.
5. Interconnection Facilities Charge.
---------------------------------
5.1 In accordance with the provisions of the attached rate schedule,
the Company will furnish, install, own and maintain Interconnection Facilities,
including protective devices, metering equipment, etc. to permit parallel
operation of the Supplier's facilities with the Company's system. The
Interconnection Facilities Charge, calculated in accordance with the Extra
Facilities Provisions of the Company's Service Regulations, to be paid by the
Supplier each month shall be
$ 871.42, which is 1.7% of the installed cost of said Interconnection
Facilities, which amount is $ 51,260.00.
5.2 The monthly charge for the Interconnection Facilities to be
provided under this Agreement is subject to the rates, service regulations and
conditions of the Company as the same are now on file with the state regulatory
commission having jurisdiction and may be changed or modified from time to time
upon approval by said regulatory commission. Any such changes or modifications,
including those which may result in increased charges for the Interconnection
Facilities to be provided by the Company, shall be made a part of this Agreement
to the same effect as if fully set forth herein.
5.3 Duke shall furnish and install the Interconnection Facilities no
later than the date requested by Supplier for such installation. Supplier's
obligation to pay the Interconnection Facilities charges shall begin on the date
that such Interconnection Facilities become operational, except as provided in
Paragraph 3.4 hereof, and such charges shall apply at all times thereafter
during the term of this Agreement, whether or not Supplier is actually supplying
electric power to Company.
6. Service Interruptions. The Parties do not guarantee continuous service. They
---------------------
shall use reasonable diligence at all times to provide satisfactory service, and
to remove the cause or causes in the event of failure, interruption, reduction
or suspension of service, but neither Party shall be liable for any loss or
damage resulting from such failure, interruption, reduction or suspension of
service, nor shall same be a default hereunder, when due to any of the
following:
(a) An emergency action due to an adverse condition or
disturbance on the system of the Company, or on any other system directly or
indirectly interconnected with it, which requires automatic or manual
interruption of the supply or electricity to some customers or areas in order to
limit the extent or damage of the adverse condition or disturbance, or to
prevent damage to generating or transmission facilities, or to expedite
restoration of service, or to effect a reduction in service to compensate for an
emergency condition on an interconnected system.
(b) An event or condition of force majeure as defined in
Paragraph 7 hereof.
(c) Making necessary adjustments to, changes in, or repairs on
Company lines, substations, and facilities, and in cases where, in its opinion,
the continuance of service from Supplier's premises would endanger persons or
property.
7. Force Majeure. Circumstances beyond the reasonable control of a Party which
solely cause that Party to experience delay or failure in delivering or
receiving electricity or in providing continuous service hereunder, including:
acts of God; unusually severe weather
Page 3 of 8
conditions; earthquake; strikes or other labor difficulties; war; riots; fire;
requirements, actions or failure to act on the part of governmental authorities
(including the adoption or change in any rule or regulation or environmental
constraints lawfully imposed by federal, state or local governments bodies), but
only if such requirements, actions or failures to act prevent or delay
performance; or transportation delays or accidents shall be deemed to be "events
or conditions of force majeure". Events or conditions of force majeure do not
include such circumstances which merely affect the cost of operating the
Facility.
8. Offset For Charges Due to Company. Company reserves the right to set off
---------------------------------
against any amounts due from Company to Supplier, any amounts which are due from
Supplier to Company, including, but not limited to, unpaid charges for
Interconnection Facilities or past due balances on any accounts Supplier has
with Company for other services.
9. Records. In addition to the regular meter readings to be taken once each
-------
month for billing purposes, the Company may require additional meter readings,
records, transfer of information, etc. as may be agreed upon by the Parties.
10. Waiver. The failure of either Party to enforce or insist upon compliance
------
with any of the terms or conditions of this Agreement shall not constitute a
waiver or relinquishment of any such terms or conditions, but the same shall be
and remain at all times in full force and effect.
11. Assignment. The rights and obligations accruing to the Supplier under this
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Agreement may be assigned to another person, partnership, or corporation,
subject to the Company's prior approval of the assignment of said person, firm,
or corporation, which approval shall not be unreasonably or arbitrarily
withheld. However, before such rights and obligations are assigned, the assignee
must first obtain necessary approval from all regulatory bodies including, but
not limited to, the North Carolina Utilities Commission.
12. Notification of Assignment, Transfer of Sale. In the event of an assignment
--------------------------------------------
of the rights and obligations accruing to the Supplier under this Agreement
pursuant to Paragraph 11 hereof, or in the event of any contemplated sale,
transfer or assignment of the Facility or the Certificate of Public Convenience
and Necessity, the Supplier shall, in addition to obtaining the approvals
required by Paragraph 13 hereof, advise the Company and the North Carolina
Utilities Commission of any plans for such an assignment, sale or transfer, or
of any accompanying significant changes in the information required by
Commission Rule R1- 37(b)(1), all as more fully set forth in Commission Rule
R1-37, as amended, which is incorporated by reference herein.
13. Regulatory Approval. This entire Agreement is contingent upon the Supplier's
-------------------
obtaining required approval from all regulatory bodies including, but not
limited to, a Certificate of Public Convenience and Necessity or its equivalent
from the North Carolina Utilities Commission. The Parties hereto agree that
performance under this Agreement shall not commence unless and until such
approvals are obtained. If at any time during the term of this Agreement any of
such required approvals expire, are withdrawn, are revoked or for any reason
become invalid, the Company shall allow the Supplier a reasonable period to cure
the problem before giving notice of termination of this Agreement.
14. Prior Agreement Superseded. This Agreement supersedes the purchased power
--------------------------
agreement between Duke Power Company and McBess Industries dated April 6, 1982
and ssigned to Mill Shoals Hydro Company, Inc. effective July 14, 1993 by
agreement dated June 22, 1992, which shall be canceled and rendered of no force
and effect on and after the Initial Delivery Date hereunder. Performance under
the prior agreement has been fully discharged by the Parties.
Page 4 of 8
Duke Power Company Electricity No. 4
North Carolina Third Revised Leaf No. 90
Superseding North Carolina Amended Second Revised Leaf No. 90
SCHEDULE PP (NC)
PURCHASED POWER
AVAILABILITY (North Carolina only)
Available only to establishments located in the Company's North Carolina service
territory which have generating facilities not in excess of eighty (80)
megawatts which are interconnected directly with the Company's system and which
are qualified facilities as determined by the Federal Energy Regulatory
Commission pursuant to Section 210 of the Public Utility Regulatory Policies Act
of 1978.
Service necessary for the delivery of the Customer's net power into the
Company's system under this Schedule shall be furnished solely to the individual
contracting Customer in a single enterprise, located entirely on a single,
contiguous premise. Service hereunder shall be restricted in the net capacity of
the Customer's generating facilities which may be operated in parallel with the
Company's system. Service necessary to supply the Customer's total load
requirements other than auxiliary load, and service necessary to supply the
Customer's auxiliary load when the Customer's generating facilities are not
operating, shall be billed on the applicable schedule(s) of the Company. Net
power delivered to the Company under this Schedule shall not offset or be
substituted for power contracted for or which may be contracted for under any
other schedule of the Company, except at the option of the Company under special
terms and conditions expressed in writing in the contract with the Customer.
The obligations of the Company in regard to service under this Schedule are
dependent upon its securing and retaining all necessary rights-of-way,
privileges, franchises and permits for such service and the Company shall not be
liable to any customer or applicant for power in the event it is delayed in, or
is prevented from purchasing power by its failure to secure and retain such
rights-of-way, rights, privileges, franchises and permits.
TYPE OF SERVICE
Company will furnish 60 Hertz service through one metering point, at one
delivery point, at one of the following approximate voltages, where available,
upon mutual agreement:
Single-phase, 120/240 volts; or
3-phase, 208Y/120 volts, 460Y/265 volts, 480Y/277 volts; or 3-phase,
3-wire, 240, 460, 480,575, or 2300 volts; or 3-phase, 4160Y/2400,
12470Y/7200, or 24940Y/14400 volts; or
3-phase voltages other than the foregoing, but only at the Company's
option, and provided that the size of the Customer's contract warrants
a substation solely to serve that Customer, and further provided that
the Customer furnish suitable outdoor space on the premises to
accommodate a ground-type tr installation, or substation, or a
transformer vault built in accordance with the Company's
specifications.
The type of service under this Schedule shall be determined by the Company.
Prospective customers shall ascertain the available voltage by written inquiry
of the Company before purchasing equipment.
RATE:
Interconnected to Distribution System:
Fixed Long-Term Rates(a)
------------------------
Variable
I. Capacity Credit Rate 5 years 10 Years(b) 15 Years(b)
---------- ----------- -------------- -----------
a. All On-Peak Energy per On-Peak Month per KWH: 1.53(cent) 1.61(cent) 1.73(cent) 1.85(cent)
b. All On-Peak energy per Off-Peak Month per KWH: 0.91(cent) 0.96(cent) 1.03(cent) 1.10(cent)
II. Energy Credit
a. All On-Peak energy per Month per KWH: 2.36(cent) 2.54(cent) 2.89(cent) 3.20(cent)
b. All Off-Peak Energy per Month per KWH: 1.75(cent) 1.79(cent) 1.97(cent) 2.14(cent)
Page 5 of 8
(Schedule PP (NC) Continued)
Interconnected to Transmission System:
Fixed Long-Term Rates(a)
------------------------
Variable
I. Capacity Credit Rate 5 years 10 Years(b) 15 Years(b)
---------- ----------- -------------- -----------
a. All On-Peak Energy per On-Peak Month per KWH: 1.46(cent) 1.54(cent) 1.65(cent) 1.77(cent)
b. All On-Peak energy per Off-Peak Month per KWH: 0.87(cent) 0.92(cent) 0.99(cent) 1.05(cent)
II. Energy Credit
a. All On-Peak energy per Month per KWH: 2.25(cent) 2.43(cent) 2.76(cent) 3.06(cent)
b. All Off-Peak Energy per Month per KWH: 1.68(cent) 1.72(cent) 1.89(cent) 2.05(cent)
Notes: (a) Fixed Long-Term Rates are applicable to those qualifying
facilities which are either (1) hydroelectric generating facilities
owned or operated by a small power producer as defined in G.S.
62-3(27a) or (2) any other qualifying facility contracting to sell
generating capacity of five (5) megawatts or less.
(b) Contracts on these long-term rates are subject to a provision
making the contract renewable for subsequent term(s) at the option
of the Company on substantially the same terms and provisions and
at a rate either (1) mutually agreed upon by the parties
negotiating in good faith and taking into consideration the
Company's then avoided cost rate and other relevant factors, or (2)
if no agreement can be reached in a reasonable amount of time, set
by arbitration.
DEFINITIONS
Net Capacity: The term "net capacity" shall mean the total capacity of the
customer's generating facilities, less the portion of that capacity needed to
serve the generating facilities' auxiliary load.
Auxiliary Load: The term "auxiliary load" shall mean power used to operate
auxiliary equipment in the facility necessary for power generation (such as
pumps, blowers, fuel preparation machinery, and oxciters).
Net Power: The term "net power" shall mean the total amount of electric power
produced by the customer's generating facilities less the portion of that power
used to supply the generating facilities' auxiliary load.
Month: The term "month" as used in this Schedule means the period intervening
between meter readings for the purposes of monthly billing, such readings being
taken once a month. The On-Peak Months shall be the billing months of June
through September and December through March. The Off-Peak Months shall be the
billing months of April, May, October and November.
DETERMINATION OF ON-PEAK AND OFF-PEAK PERIODS
The on-peak period shall be those hours, Monday through Friday, beginning at 7
A.M. and ending at 11 P.M. All other weekday hours and all Saturday and Sunday
hours shall be off-peak.
INTERCONNECTION FACILITIES CHARGE
The Customer shall be responsible for providing suitable control and protective
devices on his equipment to assure no disturbance to other customers of the
Company or to the Company itself, and to protect the Customer's facilities from
all loss or damage which could result from operation with the Company's system.
The Company will furnish, install, own, and maintain interconnection facilities
necessary for service under this Schedule including: suitable control and
protective devices installed on Company equipment to allow operation of the
Customer's generating facilities; metering facilities equipped to prevent
reverse registration for the measurement of service under this Schedule, and any
other modifications to its system required to serve the Customer under this
Schedule as determined by the Company. All such facilities shall be subject to a
monthly charge under the Extra Facilities provisions of the Company's Service
Regulations. The Company reserves the right to install at any time facilities
necessary for the appropriate measurement of service under this Schedule and to
adjust the Interconnection Facilities Charge accordingly, solely at the option
of the Company.
Page 6 of 8
(Schedule PP (NC) Continued)
DETERMINATION OF CAPACITY CREDIT
Capacity credit will be based on the energy, in kilowatt-hours, which is
supplied to the Company during the On-Peak Period of the month and will be
applied to the Customer's bill in the appropriate month.
POWER FACTOR CORRECTION
When the average monthly power factor of the power supplied by the Customer to
the Company is less than 90 percent or greater than 97 percent, the Company may
correct the energy, in kilowatt-hours, as appropriate. The Company reserves the
right to install facilities necessary for the measurement of power factor and to
adjust the Interconnection Facilities Charge accordingly, solely at the option
of the Company.
PAYMENTS
Credit ▇▇▇▇▇▇▇▇ to the Customer will be credited to the Customer's account or,
at the option of the Customer and upon ten (10) days' prior written notice,
shall be payable to the Customer within fifteen Six foot step ladder (15) days
of the date of the bill.
Bills under this Schedule are due and payable on the date of the bill at the
office of the Company. Bills are past due and delinquent on the fifteenth day
after the date of the bill. If any bill is not so paid, the Company has the
right to suspend service. In addition, all bills not paid by the twenty-fifth
day after the date of the bill shall be subject to a one percent (1%) late
payment charge on the unpaid amount. This late payment charge shall be rendered
on the following month's bill and it shall become part of and be due and payable
with the bill on which it is rendered.
CONTRACT PERIOD
Each customer shall enter into a contract which shall specify the amount of
capacity committed for delivery throughout the term of the contract and shall
specify one of the following as the minimum original term and associated rate:
variable rate for five (5) years, or, fixed long-term rate for five (5), ten
(10), or fifteen (15) years. The Company may require a contract for a longer
original term of years where the requirement is justified by the circumstances,
and, following the minimum original term, the variable rate stated above shall
apply to all power delivered to the Company until superseded by a new contract.
The Company reserves the right to terminate the Customer's contract under this
Schedule at any time upon written notice to the Customer in the event that the
Customer violates any of the terms or conditions of this Schedule or operates
his generating facilities in a manner which is detrimental to the Company or any
of its Customers, or fails to deliver energy to the Company for six (6)
consecutive months. In the event of early termination of a contract under this
Schedule, the Customer will be required to pay the Company for the costs due to
such early cancellation.
North Cardina Third Revised Leaf No. 90
Effective June 23, 1995
NCUC Docket No. E-100, Sub. 74
Page 7 of 8
IN WITNESS WHEREOF, on the day and year first above written, the
Parties hereto have caused their official names to be hereunto subscribed, and
their seals to be hereunto affixed by their respective Presidents, Vice
Presidents or Authorized Representatives, and attested by their respective
Secretaries or Assistant Secretaries. Executed in Duplicate.
ATTEST: DUKE POWER, A DIVISION OF DUKE ENERGY CORPORATION
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------- By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ --------------------
Assistant Secretary ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
ATTEST: MILL SHOALS HYDRO COMPANY, INC
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------- By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ --------------------
Secretary ▇▇▇▇▇▇ ▇. ▇▇▇▇
President
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