EXHIBIT 10.5
INTERCONNECTION AGREEMENT
BETWEEN
INDIANAPOLIS POWER & LIGHT COMPANY
AND
WABASH VALLEY POWER ASSOCIATION, INC.
FOR
INTERCHANGE WHOLESALE SALES AND PURCHASES UNDER
EMERGENCY SERVICE, ENERGY TRANSFER,
INTERCHANGE POWER, SHORT-TERM POWER,
LIMITED TERM POWER (FIRM) AND
DIVERSITY POWER SCHEDULES
0.01 This Agreement, dated as of the 7th day of October,
1987, between Indianapolis Power & Light Company ("IPL" or a
"Party"), and Wabash Valley Power Association, Inc. ("Wabash
Valley" or a "Party"), both Indiana corporations (the
"Parties"):
WITNESSETH:
0.02 WHEREAS, IPL is a public utility engaged in the
generation, transmission, distribution and sale of electric
power and energy in Indiana; and
0.03 WHEREAS, IPL is interconnected with the Joint
Transmission System (hereinafter defined) that is jointly
owned by Wabash Valley, Public Service Company of Indiana,
Inc. ("PSI") and the Indiana Municipal Power Agency ("IMPA");
and
0.04 WHEREAS, Wabash Valley is a Not-For-Profit Corporation
which jointly owns the Joint Transmission System in the State
of Indiana and is engaged, among other things, in the
generation, transmission and sale of electric power and
energy to Rural Electric Membership Corporations serving
customers in northern Indiana and southern Michigan; and
0.05 WHEREAS, the Parties believe mutual benefits can be
realized from conducting coordinated interconnected
operation, such as the interchange, sale and purchase of
electric power and energy; and
0.06 WHEREAS, the Parties desire to fix the terms and
conditions upon which such interconnected operations may be
conducted and upon which the furnishing of interconnection
services shall be effected;
0.07 NOW, THEREFORE, in consideration of the premises and of
the mutual covenants herein set forth, the Parties agree as
follows:
ARTICLE 1
DEFINITIONS
1.01 Joint Transmission System. The Joint Transmission
System shall be the transmission facilities jointly owned by
PSI, Wabash Valley, and IMPA consisting of PSI facilities
functionally serving as transmission facilities and
facilities of Wabash Valley and IMPA connected to the
transmission facilities of PSI, all having an operating
voltage of 69 KV or higher, as defined in the Uniform System
of Accounts prescribed by the Federal Energy Regulatory
Commission ("FERC").
1.02 Out-of-Pocket Cost. Out-of-Pocket Cost shall mean those
costs of generating electric energy in the generating
stations of the system of either Party which are incurred by
the supplying system directly by reason of its generating of
such energy and which, otherwise, would not have been
incurred by such system. Out-of-Pocket Cost of electric
energy purchased from a source outside of the system of the
supplying Party will be the total amount paid therefor by the
supplying Party which, otherwise, would not have been paid by
such Party.
ARTICLE 2
PROVISIONS REGARDING CONTINUITY OR
INTERRUPTION OF INTERCONNECTION OPERATIONS
2.01 Representations as to Facilities and Equipment. IPL
hereby represents that it owns and controls all the
transmission, substation and metering facilities and
equipment necessary to implement and carry out fully all the
provisions, terms and conditions of this Agreement. Wabash
Valley hereby represents that it jointly owns the
transmission, substation and metering facilities and
equipment necessary to this Agreement and has obtained all
right, power and authority from PSI and/or IMPA that is
necessary and proper for the implementation and carrying out
of all transactions of the Parties contemplated by this
Agreement. Wabash Valley hereby agrees that, notwithstanding
anything in this Agreement to the contrary, its
implementation of and compliance with the provisions, terms
and conditions of this Agreement and its resultant
obligations and responsibilities hereunder shall not be
excused because of the nature or extent of Wabash Valley's
ownership and control over the transmission, substation and
metering facilities and equipment it jointly owns with PSI
and IMPA.
2.02 Synchronous Operation. At the Points of Interconnection
(hereinafter defined) throughout the duration of this
Agreement, subject to the provisions of this Paragraph 2.02
and of Paragraph 2.03 below, IPL and Wabash Valley systems
shall be operated in continuous synchronism. If synchronous
operation of the systems at the Points of Interconnection
becomes interrupted either manually or automatically due to
reasons beyond the control of either Party or due to
scheduled maintenance that has been agreed to by both
Parties, the Parties shall cooperate to remove the cause of
such interruption as soon as practicable and restore the
Points of Interconnection to normal operating conditions.
Neither Party shall be responsible to the other for any
damage or loss of revenue caused by such interruption.
2.03 Interruption of Operation. The Parties agree that
either of them may interrupt synchronous operation through
the Points of Interconnection if either determines that its
facilities may be damaged due to excessive loadings, and such
loadings may be reduced or alleviated by such interruption.
If such interruption occurs, the Parties shall cooperate to
remove the cause of such loadings as soon as practicable and
restore the Points of Interconnection to normal operating
condition. Neither Party shall be responsible to the other
for damage or loss of revenue caused by such interruption.
The Parties further agree to study and negotiate the
installation, ownership, and cost of any additional equipment
necessary to effect a long-term solution to any such
excessive loading herein described in the event either Party
determines that this interconnection contributes to the
excessive loading and requests such negotiation.
2.04 Maintenance of Equipment. The Parties shall each keep
the lines, together with all associated equipment and
appurtenances that are located on their respective sides of
the Points of Interconnection, in a suitable condition of
repair at all times, each at its own expense, in order that
said lines will operate in a reliable and satisfactory manner
and in order that reduction in the capacity of said lines
will be avoided to the extent practicable.
2.05 New Interconnections. The Parties understand that each
of their transmission systems is interconnected with the
electric transmission systems of other electric utility
companies and each has contracted for other such
interconnections and may hereafter during the term of this
Agreement desire to make additional interconnections with
such companies or with other electric utility companies.
Each such additional interconnection with another electric
utility system shall be discussed between the Parties and if,
in the opinion of either Party, the establishment of such
interconnection will cause unreasonable transfers of real
power or reactive power through either system during normal
parallel operations as a result of the proposed additional
interconnection, before such additional interconnection is
made, joint load studies shall be conducted to determine the
effect such interconnection will have on the transmission
systems of the Parties. If, as the result of such studies it
is the reasonable opinion of a Party that the proposed
additional interconnection would cause unreasonable transfers
of real power or reactive power through the electric
transmission system of such Party or otherwise impair the
ability of such Party to carry out its own obligations, then
the Party proposing such additional interconnection shall,
before such proposed interconnection is placed in service:
2.051 agree to compensate the other Party for the use
of that portion of its facilities determined to be
dedicated to the proposed additional interconnection;
and/or
2.052 install and/or remove such equipment as
reasonably may be necessary to avoid such unreasonable
transfers of power or reactive power; or
2.053 abandon the establishment of such additional
interconnection.
ARTICLE 3
SERVICES TO BE RENDERED
3.01 Interconnection Service Schedules. It is the purpose of
the Parties to realize on an equitable basis, all benefits
practicable to be effected through coordination in the
operation and development of their respective systems. It is
understood by the Parties that such benefits may be realized
under the stated terms and conditions of the following
interconnection services:
3.011 Emergency Service. The furnishing of mutual
emergency and standby assistance, in accordance with
Service Schedule A annexed hereto.
3.012 Energy Transfer. The transfer of electric energy
through the transmission system of one Party for the
benefit of the other, in accordance with Service
Schedule B annexed hereto.
3.013 Interchange Power. The interchange, sale, and
purchase of energy to effect operating economies, in
accordance with Service Schedule C annexed hereto.
3.014 Short-Term Power. The sale and purchase of short-
term electric power and energy available on the system
of one Party and desired by the other Party, in
accordance with Service Schedule D annexed hereto.
3.015 Limited Term Power (Firm). The sale and purchase
of limited term power and energy available on the system
of one Party and desired by the other Party, in
accordance with Service Schedule E annexed hereto;
3.016 Diversity Power. The sale and purchase of
diversity power and energy, in accordance with Service
Schedule F annexed hereto.
3.02 Inasmuch as the specific services to be rendered in
furtherance of such purpose will vary, and the terms and
conditions applicable to such services may require
modification from time to time while this Agreement is in
effect, it is intended that, except as provided in Paragraph
3.05 below, such specific services and the terms and
conditions applicable thereto be set forth in service
schedules mutually agreed upon from time to time between the
Parties. Such service schedules, until and unless changed by
such mutual agreement, shall be those provided by Paragraph
3.03 below, each of which, while in effect, shall be deemed
to be a part of this Agreement.
3.03 The respective service schedules shall be designated as
follows:
I. Service Schedule A - Emergency Service
II. Service Schedule B - Energy Transfer
III. Service Schedule C - Interchange Power
IV. Service Schedule D - Short-Term Power
V. Service Schedule E - Limited Term Power (Firm)
VI. Service Schedule F - Diversity Power
Such service schedules as agreed upon between the Parties are
attached hereto, made a part hereof, and marked Exhibits I,
II, III, IV, V, and VI, respectively.
3.04 Price Protection. Except as provided in Section 4.2 of
Service Schedule F, nothing in this Agreement shall require
either Party to purchase power or energy from a third party
and resell it to the other Party at a price less than the
total cost of supplying such purchased power or energy.
3.05 Specific Short-Term Power Purchase. Wabash Valley
hereby agrees to purchase from IPL and IPL agrees to provide
to Wabash Valley, 100 megawatts of short-term power and
energy beginning January 1, 1988 through December 31, 1988 at
a demand rate of $.47/KW/week and an energy rate of IPL's Out-
of-Pocket Costs plus 10%. In all other respects, such
purchase and sale shall be in accordance with and subject to
the terms and conditions of this Agreement and of Service
Schedule D hereof.
3.06 Energy Scheduling. As a general practice, the receiving
Party shall schedule energy deliveries on an hourly basis
with the supplying Party by 12:00 o'clock Noon, E.S.T., of
the day before such energy is to be delivered; thereafter,
the supplying Party shall not be obligated to schedule energy
deliveries until the next day; provided, however, that the
Parties may schedule energy at such other times and upon such
other conditions and/or make such changes in existing energy
schedules as both Parties may agree upon in writing.
ARTICLE 4
SERVICE CONDITIONS
4.01 Control of System Disturbance. Each Party shall
maintain and operate its system in accordance with sound
operating practice so as to minimize the likelihood of
disturbance originating in one system which might cause
impairment to the service of the other system or of any
system interconnected with the other system.
4.02 Control of Kilovar Exchange. It is intended that
neither Party shall be obligated to deliver kilovars for the
benefit of the other Party; also that neither Party shall be
obligated to receive kilovars when to do so may introduce
objectionable operating conditions on their respective
systems. The Operating Committee shall be responsible for
the establishment from time to time of operating procedures
and schedules, in respect of carrying kilovar loads by one
system for the other in order to secure adequate service and
economical use of the facilities of both systems and in
respect of proper charges, if any, for the use of facilities
carrying kilovar loads. In discharging such duties the
Operating Committee shall recognize that in the transmission
and delivery of power and energy hereunder the carrying of
kilovar loads by either Party, in harmony with sound
engineering principles of transmission operation with
interconnected systems, is subject to numerous variables
contingent upon loading and operating conditions that my
exist simultaneously on both systems. The operating
procedures and schedules so set up by the Operating Committee
shall be in accord with such principles and shall require
each Party to carry kilovar loads at such times and in such
amounts as will be equitable to both Parties.
4.03 Control of Unscheduled Power and Energy Deliveries.
The Paries shall exercise reasonable foresight in carrying
out all matters related to the providing and operating of
their respective electric power resources so as to minimize,
to the extent practicable, deviations between actual and
scheduled deliveries of electric power and energy between
their systems. The Parties shall provide and install on
their respective systems such communication and telemetering
facilities as are essential to so minimize such deviations
and, to avoid, to the extent practicable, deviations from
scheduled deliveries, shall fully cooperate with each other
and with third parties whose systems are directly or
indirectly interconnected with the systems of the Parties and
who of necessity, together with the Parties, must unify their
efforts cooperatively to achieve effective and efficient
interconnected operation. The Parties recognize, however,
that, despite their best efforts to prevent it, unscheduled
deliveries of electric energy from one Party to the other may
occur. In such events, electric energy delivered hereunder
shall be settled for either by the return of equivalent
energy or by payment of the Out-of-Pocket Cost (such cost
being at the Point or Points of Interconnection set forth in
Paragraph 5.01 below, taking into account electrical losses
incurred from the source or sources of such energy to said
Point or Points) of electric energy delivered hereunder to
the supplying Party plus ten percent of such cost. If
equivalent energy is returned, it shall be returned at times
when the load conditions of the Party receiving it are
substantially equivalent to the load conditions of such party
at the time the energy for which it is returned was delivered
or, if such Party elects to have equivalent energy returned
under different conditions, it shall be returned in such
amounts, to be agreed upon by the Operating Committee, as
will compensate such Party for the difference in conditions.
ARTICLE 5
DELIVERY POINTS, METERING POINTS, AND METERING
5.01 Points of Interconnection.
5.011 All electric energy delivered under this
Agreement shall be of the character commonly known as
three-phase sixty hertz energy and, except as otherwise
provided in Paragraph 5.012 below, shall be delivered at
the IPL established points of interconnection listed
below ("Points of Interconnection"):
Petersburg substation of IPL near Petersburg,
Indiana
Sunnyside substation of IPL near Oaklandon, Indiana
Five Points substation of PSI in Five Points,
Indiana
Whitestown substation of PSI in Whitestown, Indiana
5.012 In addition to the Points of Interconnection, IPL
has interconnections with Indiana & Michigan Electric
Company, Southern Indiana Gas and Electric Company and
Hoosier Energy Rural Electric Cooperative, Inc. (each
such utility being hereinafter referred to as a "Third
Party"). If Wabash Valley requests IPL to deliver
energy under this Agreement to a Third Party, Wabash
Valley shall be responsible for obtaining transmission
agreements with such Third Party for the transmission
and delivery of energy to a designated Third Party
interconnection point for and on behalf of Wabash
Valley; provided, that IPL shall not be responsible to
Wabash Valley or such Third Party for such energy beyond
such Third Party interconnection point. Wabash Valley
shall provide in advance to IPL an information copy of
each such transmission agreement and a copy of each PSI,
IMPA and Third Party letters concurring with each of
such transactions. In addition, Wabash Valley shall
obtain IPL's consent in writing to such Third Party
transaction, which consent shall not be unreasonably
withheld.
5.02 Metering Points. Electric power and energy supplied
under this Agreement shall be measured by suitable metering
equipment, at the voltages and metering points specified
below ("Metering Points") and at such other points, voltages,
and ownership as may be agreed upon by the parties in a
written amendment hereto:
345 KV meters owned by IPL at the Petersburg
substation of IPL.
138 KV meters owned by IPL at the Petersburg
substation of IPL.
345 KV meters owned by IPL at the Sunnyside
substation of IPL.
138 KV meters owned by IPL at the Five Points
substation of PSI.
345 KV meters owned by IPL at the Whitestown
substation of PSI.
5.03 Metering Equipment. Suitable metering equipment at the
metering points provided in Paragraph 5.01 above shall
include electric meters, potential and current transformers,
and such other appurtenances as shall be necessary to give
for each direction of flow the following quantities: a
continuous automatic graphic record of both kilowatts and
kilovars; an automatic record of the kilowatthours for each
clock hour; and a continuous integrating record of the
kilowatthours.
5.04 Measurement of Electric Energy. Measurement of electric
energy under this Agreement shall be made by standard types
of electric meters installed and maintained at the Metering
Points. The timing devices of meters shall be synchronized
as closely as practical. All meters shall be sealed, and the
seals shall be broken only when the meters are to be tested
or adjusted.
5.05 Access to Meters and Records. Authorized
Representatives (hereinafter defined) of both Parties shall
have reasonable access to the premises where the meters are
located and to the records made by the meters.
5.06 Meter Testing. Each Party shall routinely test or have
tested the above-referenced meters and shall maintain records
of meter accuracy all in accordance with prudent utility
practices. Each Party shall have the right, at its expense,
to require that the other Party conduct a special test of its
meters as soon as practicable; provided, that if such test
shows the meter to be more than two percent (2%) inaccurate,
the Party owning the meter shall bear the cost of such test.
Representatives of both Parties shall be notified and
afforded the opportunity to be present at all routine or
special tests and whenever any readings are taken from meters
not providing an automatic record. Both Parties shall be
provided with a schedule of routine testing dates for
metering equipment which measures transactions entered into
pursuant to this Agreement.
5.07 Adjustments Due to Inaccuracies. If any metering
equipment test discloses an inaccuracy exceeding two percent
(2%), the energy account between the Parties shall be
adjusted to correct for the inaccuracy disclosed over the
shortest of the following periods; (i) for the six (6) month
period immediately preceding the day of the test, or (ii) for
the period that such inaccuracy may be determined to have
existed, or (iii) if the last test took place within the
immediately preceding six month period and the period of
inaccuracy cannot be determined, for the period since the
last test. Should the metering equipment fail to register,
the amount of electric power and energy delivered shall be
determined from the best available data.
5.08 Communication, Telemetering And Load Control Facilities.
Each Party shall provide such communication, telemetering and
load control facilities as are now or may hereafter be
determined and agreed upon by the Parties as necessary for
the proper and efficient interconnection operation of the
Parties' systems.
ARTICLE 6
RECORDS AND STATEMENTS
6.01 Records. In addition to records of the metering
provided for in Article 5 hereof, the Parties shall keep
complete records as may be needed to substantiate a clear
history of the various deliveries of electric energy made,
and of the clock-hour integrated demands in kilowatthours
delivered, by one Party to the other. In maintaining such
records, the Parties shall effect such segregations and
allocations of demands and electric energy delivered into
classes representing the various services and conditions as
may be needed to effect settlements under this Agreement.
All such records shall be retained by the Party keeping the
records. A Party's records shall be available at all
reasonable times for inspection by the other Party's
Representative and may be copied at such other Party's
expense.
6.02 Statements. As promptly as practicable after the end of
each calendar month, the Parties shall cause to be prepared a
statement setting forth the electric power and energy
transactions between the Parties during such month in such
detail and with such segregations as may be needed for
operating records or for settlements under this Agreement.
ARTICLE 7
▇▇▇▇▇▇▇▇, PAYMENTS AND BILLING DISPUTES
7.01 All bills for amounts owed by one Party to the other
shall be due and payable on the fifteenth (15th) day of the
month next following the month in which the service was
provided, or on the tenth (10th) day after receipt of a ▇▇▇▇
therefor, whichever is later. Interest on unpaid amounts
shall accrue at the annual rate of five percent (5%) above
the prime commercial lending rate established from time to
time by Merchants National Bank and Trust Company of
Indianapolis, Indiana (the "Prime Lending Rate") and is
payable from the date the ▇▇▇▇ is due to the date of payment.
The term "month" shall mean a calendar month for the purpose
of settlements under this Agreement.
7.02 Billing Disputes. If either Party disputes the
correctness of a ▇▇▇▇, it will, nevertheless, pay the
undisputed portion of such ▇▇▇▇ plus a minimum of one-half
(1/2) of the disputed amount and shall submit to the other
Party a written statement detailing the items disputed. If
the Parties are unable to agree upon the disputed items, such
items shall be submitted to the Operating Committee for
decision. Should the Operating Committee be unable to reach
a decision, the matter shall be submitted to the President of
IPL and the General Manager of Wabash Valley for decision.
Any refund or additional payment ordered by the Operating
Committee or by the President of IPL and General Manager of
Wabash Valley shall be subject to interest computed at the
Prime Lending Rate existing at the time of the refund or
additional payment plus five percent (5%), said interest to
be calculated, in the case of a refund, from the date the
amount to be refunded was paid to the date of the refund and,
in the case of an additional amount ordered to be paid, from
the original due date to the payment date.
ARTICLE 8
OPERATING COMMITTEE
8.01 Operating Committee Organization And Duties. To
coordinate the operation of their respective generation,
transmission and substation facilities in order that the
advantages to be derived under this Agreement may be realized
by the Parties hereto to the fullest extent practicable, the
Parties shall establish a committee of authorized
representatives to be known as the Operating Committee. Each
Party shall designate in a writing delivered to the other
Party, the person who is to act as its representative on the
Operating Committee and each person who may serve as
alternates whenever such representative is unable to act
("Representatives"). Each of such Representatives shall be
persons familiar with the generation, transmission, and
substation facilities of the system of the Party he or she
represents, and each shall be fully authorized (i) to
cooperate with the other Representatives and (ii) to
determine and agree from time to time, in accordance with
this Agreement and with any other relevant agreements then in
effect between the Parties, upon the following:
8.011 All matters pertaining to the coordination of the
maintenance of generation and transmission facilities of
the Parties.
8.012 All matters pertaining to the control of time,
frequency, energy flow, kilovar exchange, power factor,
voltage, and other similar matters bearing upon the
satisfactory synchronous operation of the systems of the
Parties.
8.013 Such other matters not specified herein in
respect of which cooperation, coordination, and
agreement as to quantity, time, method, terms and
conditions are necessary to the efficient operation of
the respective systems of the Parties, to the end that
the intent and purpose of this Agreement shall be
realized by the Parties to the fullest extent
practicable.
8.02 Operating Committee Access. For the purpose of
inspection and reading of meters, checking of pertinent
records and related matters, the Representatives shall have
the right of access at any reasonable time to all facilities
and equipment of the Parties used or to be used in the
performance of this Agreement.
8.03 Operating Committee Expenses. Each Party shall be
responsible for the expenses of its members; provided that
any expense jointly incurred by the Operating Committee in
performing its duties shall be shared equally by the Parties.
8.04 Operating Committee Meetings. The Operating Committee
shall meet at least annually at a time and place mutually
agreed to by the Representatives. On request of any
Representative, a special meeting shall be arranged not more
than five working days after the request unless the Party
requesting the meeting agrees to a later date. Attendance at
the meetings shall not be limited to Representatives;
however, the Parties recognize the practical necessity of
limiting attendance of non-Representatives to those who are
expected to take an active part on the agenda for a given
meeting.
8.05 Agreement Not To Be Modified By Committee. The
Operating Committee shall not have authority to modify any of
the terms or conditions of this Agreement.
8.06 Change of Representatives. Each Party shall give prompt
written notice to the other Party of any change in
designation of its primary or alternate Representative on the
Operating Committee.
8.07 Unresolved Disputes. If the Operating Committee shall
be unable to take action on any matter to be acted upon by it
under this Agreement because of a dispute between the
Representatives as to such matter, then the matter shall be
referred to the President of IPL and the General Manager of
Wabash Valley.
ARTICLE 9
CONTINUITY AND SUSPENSION OF SERVICE,
RELATIVE RESPONSIBILITIES
9.01 Continuity and Suspension of Service. Each Party shall
exercise reasonable care and foresight to maintain continuity
of service as provided in this Agreement, but neither Party
shall be considered in Default (hereinafter defined) in
respect of any obligation hereunder if prevented from
fulfilling such obligation by reason of Force Majeure as
defined in Article 11 below. In no event shall either Party
be liable to the other Party for loss or damage arising from
failure, interruption or suspension of service. Each Party
reserves the right to suspend service without liability at
such times and for such periods and in such manner as it
deems advisable, including, without limitation, suspensions
for the purpose of making necessary adjustments to, changes
in, or repairs on, its facilities, and suspensions in cases
where, in its sole opinion, the continuance of service to the
other Party would endanger persons or property. Both Parties
shall use their best efforts to provide each other with
reasonable notice in the event of suspension of service.
9.02 Relative Responsibilities. Each Party assumes all
responsibility for receipt and delivery of electricity on its
system to and from its Points of Interconnection. Neither
Party assumes any responsibility with respect to the
construction, installation, maintenance or operation of the
system of the other Party or of the systems of third parties,
in whole or in part. Neither Party shall, in any event, be
liable for damage or injury to any persons or property,
whatsoever, arising, accruing or resulting from, in any
manner, the receiving, transmission, control, use,
application or distribution by the other Party of said
electricity. Each Party shall use reasonable diligence to
maintain its facilities in proper and serviceable condition,
and shall take reasonable steps and precautions for
maintaining the services agreed to be provided and received
under this Agreement.
ARTICLE 10
TERM OF AGREEMENT
10.01 Effective Date. The effective date of this
Agreement (the "Effective Date") shall be the date as of
which all conditions precedent set forth in Paragraph 13.01
below have been satisfied. Such Effective Date shall be
specified in a writing executed by both Parties. The Parties
agree to use their best efforts to support and cooperate with
each other to satisfy said conditions precedent.
10.02 Term. The term of this Agreement and of the
annexed Service Schedules shall begin on the Effective Date
and continue through December 31, 1997 (the "Initial Term");
thereafter, the Agreement and Service Schedules shall
continue for successive terms of three (3) years each until
terminated pursuant to notice given by either Party to the
other or otherwise terminated under Paragraphs 18.01 or 19.03
below. Any notice of termination given hereunder shall be
given in writing, at least two (2) years prior to the end of
the Initial Term or any successive term, and may be delivered
at any time after the Effective Date of this Agreement;
provided, that this Agreement shall not be deemed to have
terminated until all prior commitments for sales or purchases
of power and energy under this Agreement have been fulfilled
and all payments therefor have been made.
ARTICLE 11
FORCE MAJEURE
11.01 Force Majeure. The term "Force Majeure" shall mean
any cause beyond the control of the Party invoking the Force
Majeure, including, but not limited to, failure or threat of
failure of facilities, equipment or fuel supply, ice, act of
God, flood, earthquake, storm, fire, lightning, explosion,
epidemic, war, civil war, invasion, insurrection, military or
usurped power, act of the public enemy, riot, civil
disturbance or disobedience, strike, lockout, work stoppage,
other industrial disturbance or dispute, labor or material
shortage, national emergency, sabotage, failure of
contractors or suppliers of materials, inability to obtain or
ship materials or equipment because of the effect of similar
causes on suppliers or carriers, restraining by court order
or other public authority or governmental agency, or action
or non-action by, or failure to obtain the necessary
authorizations or approvals from, or obtaining of the
necessary authorizations or approvals only subject to
unreasonable restrictions from, any governmental agency or
authority, which by the exercise of due diligence such Party
could not reasonably have been expected to avoid. Nothing
contained herein shall be construed to require a Party to
settle any strike, lockout, work stoppage or other industrial
disturbance or dispute in which it may be involved or to take
an appeal from any judicial, regulatory or administrative
action. Any Party rendered unable to fulfill any of its
obligations under this Agreement by reason of Force Majeure
shall exercise due diligence to remove such inability with
all reasonable dispatch. In the event either Party is
unable, in whole or in part, to perform any of its
obligations by reason of Force Majeure the obligations of the
Party relying thereon, insofar as such obligations are
affected by such Force Majeure, shall be suspended during the
continuance thereof but no longer. The Party invoking the
Force Majeure shall specifically state the full particulars
of the Force Majeure and the time and date when the Force
Majeure occurred. Notices given by telephone under the
provisions of this Article shall be confirmed in writing as
soon as reasonably possible. When the Force Majeure ceases,
the Party relying thereon shall give immediate notice thereof
to the other Party. This agreement shall not be terminated
by reason of Force Majeure but shall remain in full force and
effect.
ARTICLE 12
DEFAULT
12.01 Default Defined. As used herein, "Default" shall
mean the failure of a Party to make any payment or perform
any obligation at the time and in the manner required by this
Agreement, except where such failure to discharge obligations
(other than the payment of money) is the result of Force
Majeure. Failure to make any payment in the time and manner
required by this Agreement shall not be excused as a Default
by payment of late charges except with respect to a Default
cured in accordance with the provisions in Paragraph 12.02
below.
12.02 Remedies for Default. Upon failure of a Party to
make a payment or perform an obligation required hereunder,
the other Party shall give written notice of Default to the
Defaulting Party. The Defaulting Party shall have thirty
(30) days within which to cure the Default. If a Default is
not cured within such period, the Party not in Default, at
its option, may, in addition to all other rights and remedies
available at law, in equity or under any other provision of
this Agreement: (i) give notice to the Defaulting Party of
its intention to cure the Default and to take such steps as
such Party deems necessary to cure the Default, or (ii)
suspend this Agreement for a period of 6 months, after which
this Agreement shall automatically terminate. The Defaulting
Party shall, in any event, pay to the other Party the total
of all additional costs reasonably incurred by the Party as a
result of such Default and/or the curing of such Default,
including reasonable attorneys' fees, money reasonably paid
to others, the reasonable equivalent in money for services or
property obtained, and any other costs reasonably incurred by
such non-Defaulting Party in attempting to remedy such
Default, together with interest on the total of such costs at
the per annum rate of five (5) percent above the Prime
Lending Rate. This provision is not intended as a liquidated
damages provision or to limit liability in any way, and the
Party not in Default may also maintain such other actions for
damages as may be provided by law, in equity or under this
Agreement.
ARTICLE 13
CONDITIONS PRECEDENT TO EFFECTIVENESS
OF AGREEMENT AND AMENDMENTS
13.01 Conditions Precedent. The Effective Date of this
Agreement is conditional upon the approval by the United
States Bankruptcy Court having jurisdiction over the property
and operations of Wabash Valley and the approval or
acceptance of this Agreement by FERC and any other regulatory
authority or other governmental agency having jurisdiction.
If any of the terms and conditions of this Agreement are
altered or made impossible of performance by order, rule, or
regulation of said Court or of any such regulatory agency
and, as a result, the Parties hereto are unable to agree upon
a modification of such terms and conditions that will satisfy
such order, rule or regulation, then neither Party shall be
liable to the other for failure thereafter to comply with
such terms and conditions; provided, that if either Party
deems that the impossibility of such performance results in a
substantial loss of the benefits to be derived from this
Agreement, this Agreement may be terminated forthwith upon
notice.
13.02 Cooperation With FERC Filing. Both Parties
recognize and agree that this Agreement must be filed with
the FERC, and both Parties agree to jointly request
acceptance for filing of this Agreement without suspension by
the FERC. In this connection, both Parties agree that each
of them will execute any and all documents, duly authorize
all officers or agents as necessary, and do all other things
necessary and appropriate to secure acceptance for filing of
this Agreement, including the terms and conditions and the
initial rates and charges hereof, by the FERC without
suspension, or change or modification in the terms hereof.
13.03 Amendments. Except as otherwise provided in
Paragraph 19.02 below or in the provisions of the Service
Schedules, this Agreement may be amended only by mutual
agreement of the Parties, which amendment shall be in writing
and shall become effective upon satisfaction of the above
Conditions Precedent applicable thereto.
ARTICLE 14
INDEMNIFICATION AND LIMITATION OF LIABILITY
14.01 Limitation of Liability. In no event shall one
Party be liable to the other Party for any indirect, special,
incidental or consequential damages with respect to any claim
arising out of this Agreement.
14.02 Indemnification Clause. Each Party shall
indemnify, defend and hold harmless the other Party from and
against any liability, loss, cost, damage and expense because
of injury or damage to persons or property resulting from, or
arising out of the use of its own facilities or the
production or flow of electric energy by and through its own
facilities, except when such injury or damage is due to the
sole negligence of the other Party. In addition, each Party
shall hold the other Party harmless for any taxes, licenses,
permits, fees, penalties, or fines assessed against one Party
upon any of the property of such Party located on the
premises of the other Party.
14.03 Each Party shall be responsible for its own
compliance with all applicable environmental regulations, and
each Party shall hold the other Party harmless from any
liability, loss, cost or expense arising out of, and shall
bear all costs arising from, its failure to comply with such
environmental regulations.
ARTICLE 15
TAXES
15.01 If at any time during the term of this Agreement
there should be levied or assessed against either of the
Parties any direct taxes by any taxing authority on the power
and/or energy generated, purchased, sold, transmitted,
interchanged, or exchanged under this Agreement, which taxes
are in addition to or different from the forms of direct
taxes being levied or assessed on the date of this Agreement
and such direct taxes results in increasing the cost to
either or both Parties of carrying out the provisions of this
Agreement, then the rates and charges for such power and/or
energy furnished hereunder shall be increased automatically
to the extent necessary to make adequate and equitable
allowance for such taxes.
ARTICLE 16
WAIVERS
16.01 Any waiver by either Party of its rights under this
Agreement, shall not be deemed a waiver with respect to any
rights that subsequently accrue. Any delay, less than the
statutory period of limitations, in asserting or enforcing
any rights under this Agreement, shall not be deemed a waiver
of such rights.
ARTICLE 17
INSURANCE
17.01 Insurance. Each Party shall be responsible for the
procurement and maintenance of its own property, casualty and
third-party liability insurance to adequately protect its
personnel and property and to cover its liabilities and
responsibilities under this Agreement.
ARTICLE 18
ASSIGNMENT
18.01 Assignment of Agreement. This Agreement shall
inure to the benefit of, and be binding upon, the respective
successors and assigns of the Parties and, insofar as
permitted by law, on any trustee appointed for a Party under
the United States Bankruptcy Code; and this Agreement may not
be assigned by either Party, without the written consent of
the other Party. In the event either Party is liquidated or
dissolved as a corporation or otherwise terminates its
business operations, this Agreement shall become null and
void and all obligations under this Agreement and the Service
Schedules, except financial obligations incurred prior to
such event shall cease upon the date of such event.
ARTICLE 19
MISCELLANEOUS
19.01 Prudent Utility Practices. The Parties shall
discharge all obligations under this Agreement in accordance
with prudent utility practices.
19.02 Change in Rates. Nothing herein shall be construed
as affecting in any way the right of Wabash Valley to
unilaterally make a change in rates or charges applicable to
the furnishing of service by Wabash Valley under this
Agreement provided such change is approved by appropriate
state and/or federal regulatory authority. Nothing contained
herein shall be construed as affecting in any way the right
of IPL in furnishing service under these rate schedules to
unilaterally make application to the FERC for a change in
rates under Section 205 of the Federal Power Act and pursuant
to the FERC's Rules and Regulations promulgated thereunder.
19.03 No Partnerships; Tax Matters. Notwithstanding any
provision of this Agreement to the contrary, the Parties do
not intend to create hereby any joint venture, partnership,
association taxable as a corporation, or other entity for the
conduct of any business for profit, and any construction of
this Agreement to the contrary which has an adverse tax
effect on either Party shall render this Agreement null and
void from its inception.
19.04 Survivorship Of Certain Obligations.
Notwithstanding Paragraph 19.03 above, the voidance of this
Agreement shall not discharge any Party from any obligation
it owes to the other Party under this Agreement by reason of
any transaction, loss, cost, damage, expense or liability
which shall have occurred or arisen after the Effective Date
of this Agreement, but prior to such voidance. It is the
intent of the Parties that should this Agreement be voided
under Paragraph 19.03 above, the satisfaction of any such
obligation and the provisions for indemnification and limited
liability of Article 14 above shall constitute a separate
agreement between the Parties that is severable from this
Agreement and, as such, shall remain in full force and effect
for actions that occurred prior to the voidance of this
Agreement.
19.05 Computation of Time. In computing any period of
time prescribed or allowed by this Agreement, the day of the
act, event, or default from which the designated period of
time begins to run shall be excluded but the last day of such
period shall be included, unless it is a Saturday, Sunday, or
legal holiday, in which event the period shall run until the
end of the next business day which is not a Saturday, Sunday,
or legal holiday.
19.06 Section Headings Not To Affect Meaning. The
descriptive headings of the Articles and paragraphs of this
Agreement have been inserted for convenience only and shall
not modify or restrict any of the terms and provisions
thereof.
ARTICLE 20
NOTICES
20.01 Notices Relating to Provisions of this Agreement.
Any notice, demand or request made by a Party to the other
Party pursuant to any provision of this Agreement shall be
made in writing and shall be delivered in person, by prepaid
telegram or by registered or certified mail to the named
officer of the Party at the address listed below; provided,
that either Party may, from time to time, change such
designated officer or the address thereof by giving written
notice of such change to the other Party.
TO IPL:
President
Indianapolis Power & Light Company
P. O. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TO Wabash Valley:
General Manager
Wabash Valley Power Association, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
P. O. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
20.02 Notices Of An Operating Nature. Any notice,
request or demand pertaining to matters of an operating
nature may be served in person or by United States mail,
messenger, telephone, or telegraph, as circumstances dictate,
to a Representative; provided, that should the same not be
written, confirmation thereof shall be made in writing as
soon as practicable thereafter, upon request of the Party
being served.
ARTICLE 21
GOVERNING LAW AND CONSTRUCTION OF AGREEMENT
21.01 This Agreement shall be governed by and construed
according to the laws of the State of Indiana.
ARTICLE 22
ENTIRE AGREEMENT CONTAINED HEREIN
22.01 This is the entire agreement between the Parties
and no oral or other written representations shall have the
affect of amending or modifying this Agreement.
IN WITNESS WHEREOF, the Parties have caused this Agreement to
be executed by their respective duly authorized officers and
their respective corporate seals to be hereunto affixed as of
the date first above written.
INDIANAPOLIS POWER & LIGHT
COMPANY
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇, President
and
Chief Operating Officer
ATTEST:
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President,
Secretary and General Counsel
WABASH VALLEY POWER
ASSOCIATION,
INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
ATTEST:
By: /s/ ▇▇▇ ▇. ▇▇▇▇
▇▇▇ ▇. ▇▇▇▇, Secretary
EXHIBIT I
SERVICE SCHEDULE A
EMERGENCY SERVICE
Under Interconnection Agreement dated October 7, 1987 between
Indianapolis Power & Light Company and
Wabash Valley Power Association, Inc. (the "Agreement")
SECTION 1 - DEFINITIONS
1.1 The meaning of the terms used herein shall be the same
as those used in the Agreement.
SECTION 2 - DURATION
2.1 This Service Schedule shall become effective as of the
Effective Date of the Agreement and shall continue in effect
throughout the duration of the Agreement.
SECTION 3 - SERVICES TO BE RENDERED
3.1 In the event of a breakdown or other emergency in or on
the system of either Party involving either sources of power
or transmission facilities, or both, which impair or
jeopardize the ability of a Party suffering the emergency to
meet the loads of its system, the other Party shall deliver
the electric energy ("Emergency Energy") that such Party
requests; provided, however, that a Party shall not be
obligated to deliver such energy which it, in its sole
judgment, cannot deliver without interposing a hazard to or
economic burden upon its operations or without impairing or
jeopardizing the other load requirements of its system; and
provided further, that neither Party shall be obligated to
deliver electric energy to the other Party: (a) for a period
in excess of forty-eight consecutive hours during any single
emergency, or (b) when it is delivering electric energy under
another (other) mutual emergency interchange agreement(s), or
(c) at any time that delivery of emergency energy will impair
its own system's ability to meet its load.
SECTION 4 - COMPENSATION
4.1 Emergency Energy delivered under Section 3 above that is
generated by the supplying Party shall be settled for either
by the return of equivalent Energy or, at the option of the
Party that supplied such Energy, by payment of the greater of
110 percent of the Out-of-Pocket Costs of supplying such
Energy or 30 ▇▇▇▇▇ per kilowatthour thereof.
4.2 Emergency Energy delivered under Section 3 above that is
purchased by the supplying party from another interconnected
system which is not a signatory to this Agreement ("Third
Party") at the request of the receiving party shall be
settled for as follows:
4.21 When IPL is the supplying party, a payment of 100
percent of the amount paid to such Third Party plus up
to 3.46 ▇▇▇▇▇ per kilowatthour (consisting of up to 2.46
▇▇▇▇▇ per kilowatthour for a transmission charge and 1
mill per kilowatthour for difficult to quantify energy
related costs) plus any transmission losses.
4.22 When Wabash Valley is the supplying party, a
payment of 100 percent of the amount paid to such third
party plus 2.0 ▇▇▇▇▇ per kilowatthour plus any
transmission losses.
4.3 If the supplying Party opts to receive equivalent energy
for Emergency Energy delivered, such equivalent energy shall
be returned at times when the load conditions of the Party
originally supplying Emergency Energy are substantially
equivalent to the load conditions of such Party existing at
the time the Emergency Energy was delivered or, if such Party
elects to have equivalent energy returned under different
conditions, it shall be returned in such amounts and at such
times as the Operating Committee agrees will compensate the
original supplying Party for the difference in conditions.
EXHIBIT II
SERVICE SCHEDULE B
ENERGY TRANSFER
Under Interconnection Agreement dated October 7, 1987 between
Indianapolis Power & Light Company and
Wabash Valley Power Association, Inc. (the "Agreement")
SECTION 1 - DEFINITIONS
1.1 The meaning of the terms used herein shall be the same
as those used in the Agreement.
SECTION 2 - DURATION
2.1 This Service Schedule shall become effective as of the
Effective Date of the Agreement and shall continue in effect
throughout the duration of the Agreement.
SECTION 3 - TRANSFER ARRANGEMENT
3.1 In carrying out the interconnected operation of their
respective systems as provided for under the Agreement,
energy being received by a portion of one Party's system from
another portion of its system or from the system of another
interconnected company, or energy being delivered by a
portion of one Party's system to another portion of its
system or to the system of another interconnected company,
may flow over the transmission facilities of the other Party
as a natural result of the physical and electrical
characteristics of the interconnected network of transmission
lines to which the Parties are connected. Such flow of
energy may occur during periods of emergency caused by the
failure of either sources of power or transmission
facilities, or both. In respect to such flow of energy
(hereinafter called "Energy Transfer") the Parties agree as
follows:
3.11 Such Energy Transfer over their respective
transmission facilities shall be permitted whenever such
transfer occurs; provided, that such Energy Transfer
shall not be of such magnitude or duration as to affect
adversely, or jeopardize the ability of, the Party over
whose system such Energy Transfers occur, to render
proper service to its customers, and to render or accept
service to or from companies with which it now has, or
at any time hereafter may have, contractual arrangements
for the interchange of power or energy.
3.12 The Parties recognize that in carrying out the
provisions of this Service Schedule, the Energy Transfer
either during periods when conditions of system
operation are normal or during periods of emergency, or
both, may eventually require the installation of
additional transmission facilities in order that such
Energy Transfer may be properly controlled to the end
that the ability of the Party over whose system such
Energy Transfer occurs to
meet its own requirements, as described under 3.11
above, is not affected adversely or jeopardized. In the
event the need for such additional transmission
facilities becomes apparent to either of the Parties
during the duration of this Service Schedule, upon
written notice given by either Party to the other Party
and as soon as practicable following such notice, the
Parties shall jointly reexamine conditions relating to
Energy Transfer. In such reexamination, if called for,
the Parties shall agree upon such additional
transmission facilities as may be required to be
installed, if any, and upon an equitable basis for
bearing the cost of installing, maintaining and
operating such facilities, if installed.
SECTION 4 - POWER AND ENERGY ACCOUNTING
4.1 The Parties recognize that Energy Transfer as described
under Section 3 above, except for such amounts of electrical
losses as may be incurred because of such Energy Transfer, is
the simultaneous acceptance and delivery of like amounts of
power and energy by and from the system of the Party over
whose system such transfer occurs. Power and energy
associated with Energy Transfer, including electrical losses
associated therewith, shall be accounted for each clock-hour
as provided for under Article 6 of the Agreement. Proper
consideration to such electrical losses will be in accordance
with the manner agreed upon by the Operating Committee. It
is understood by the Parties, however, that such electrical
losses resulting from Energy Transfer, to be taken as losses
over and above the losses prevailing under basic conditions
agreed upon by the Parties, shall be supplied simultaneously
by the Party for whom the Energy Transfer is being made. The
Parties agree that initially such basic conditions will be
established as those that exist when the scheduled net
delivery between the systems of the Parties and between their
respective systems and the systems of other interconnected
companies, is zero kilowatts. It is further understood that,
from time to time, conditions may require the establishment
of different basic conditions for such purpose. Either Party
by written notice given to the other Party may call for a
prompt reexamination and reconsideration of matters pertinent
to the establishment of said basic conditions, whenever such
reexamination appears to be warranted, and the Parties will
thereupon agree to effect such changes in the basic
conditions, if any, that will equitably compensate the
Parties for such losses. Should such reexamination be
required, a statement will be prepared by the Parties which
shall include in detail the amounts of energy delivered and
received by the Parties that are associated with Energy
Transfer and the amounts of electrical losses associated
therewith.
EXHIBIT III
SERVICE SCHEDULE C
INTERCHANGE POWER
Under Interconnection Agreement dated October 7, 1987 between
Indianapolis Power & Light Company and
Wabash Valley Power Association, Inc. (the "Agreement")
SECTION 1 - DEFINITIONS
1.1 The meaning of the terms used herein shall be the same
as those used in the Agreement.
SECTION 2 - DURATION
2.1 This Service Schedule shall become effective as of the
Effective Date of the Agreement and shall continue in effect
throughout the duration of the Agreement.
SECTION 3 - SERVICES TO BE RENDERED
3.1 Economy Energy. Either Party may arrange to purchase
from the other Party electrical energy ("Economy Energy")
when it is possible to effect a saving thereby and, when, in
the sole judgment of the supplying Party, such energy is
available. Prior to each Economy Energy transaction, the
amount of energy, the time of its delivery, and the
compensation therefore shall be determined by the Parties.
Compensation so determined by the Parties shall not be
subject to later review or adjustment. In the event
conditions arise during such scheduled period which cause the
delivery of Economy Energy to become burdensome to the
supplying Party, said Party has the right to request the
receiving Party to reduce the amount of such energy to any
quantity specified. Receipt or delivery of Economy Energy
may also be arranged with other interconnected systems not
Parties to this Agreement.
3.2 Non-Displacement Energy. It is recognized that
occasions will arise when transactions under subsection 3.1
above will be impracticable although a Party may have
electric energy (herein called "Non-Displacement Energy")
which it is willing to make available from surplus capacity
from its own system or from outside sources, or both and
which can be utilized advantageously for short intervals by
the other Party. In such event, the Party desiring such
receipt of energy shall notify the other Party of the extent
to which it desires to obtain Non-Displacement Energy, and if
the other Party, in its sole judgment, determines that Non-
Displacement Energy is available, schedules providing the
periods and extent of use shall be mutually agreed upon.
Neither Party shall be obligated to make any Non-Displacement
Energy available to the other.
SECTION 4 - COMPENSATION
ECONOMY ENERGY
4.1 The charge for Economy Energy purchased by either Party
from the other Party shall be based on the principle that the
Party purchasing it shall pay the Out-of-Pocket Cost of the
Party supplying such Energy and that the resulting savings to
the receiving Party shall be equally shared by the supplying
and receiving Parties.
4.2 When Economy Energy is obtained from or delivered to a
system interconnected with either of the Parties which is not
a signatory to the Agreement ("Third Party"), payments among
the participants in such a transaction shall be based on the
Out-of-Pocket Costs of the supplying Party or Third Party
providing the Energy and an allocation of the gross savings,
which are defined as the difference between (1) what the Out-
of-Pocket Costs of the receiving Party or Third Party would
have been to generate such Energy, and (2) the Out-of-Pocket
Costs of the supplying Party or Third Party providing the
Energy. Such allocation shall be made as provided in
Subsections 4.21 and 4.22 herein below.
4.21 The transmitting party shall be paid (A) its cost
of purchasing the Energy supplied, plus (B) its costs of
additional transmission losses plus (C) the following:
(1) When IPL is such transmitting party:
The greater of (i) fifteen percent of the
gross savings remaining after deducting all
such payments for transmission losses or (ii)
an amount not to exceed 3.46 ▇▇▇▇▇ per
kilowatthour of Energy received for
transmission.
(2) When Wabash Valley is such transmitting party:
The greater of (i) fifteen percent of the
gross savings remaining after deducting all
such payments for transmission losses or (ii)
an amount not to exceed 2.0 ▇▇▇▇▇ per
kilowatthour of Energy received for
transmission.
4.22 The supplying Party or Third Party shall be paid
its Out-of-Pocket Costs of providing the Energy, plus
one-half of the gross savings remaining after deducting
all payments made under Subsection 4.21 (B) and (C).
The receiving Party or Third Party shall pay an amount
which will provide it with the other one-half of the
gross savings remaining after deducting all payments
made under Subsection 4.21 (B) and (C).
NON-DISPLACEMENT ENERGY
4.3 Non-Displacement Energy delivered hereunder that is
generated by the supplying Party's system shall be settled
for either by the return of equivalent Energy or, at the
option of the supplying Party, by payment of the Out-of-
Pocket Costs of the supplying Party in generating such Energy
plus ten percent of such cost. If equivalent Energy is
returned, it shall be returned at times when the load
conditions of the Party receiving it are equivalent to the
load conditions of such Party at the time the energy in
exchange for which it is returned was delivered or, if such
Party elects to have equivalent Energy returned under
different conditions, it shall be returned in such amounts,
to be agreed upon by the Operating Committee, as will
compensate for the difference in conditions.
4.4 Non-Displacement Energy delivered under Subsection 3.2
above that is purchased by the supplying party from another
interconnected system which is not a signatory to this
Agreement ("Third Party") at the request of the receiving
party shall be settled for as follows:
4.41 When IPL is the supplying party, a payment of 100
percent of the amount paid to such Third Party, plus up
to 3.46 ▇▇▇▇▇ per kilowatthour (consisting of up to 2.46
▇▇▇▇▇ per kilowatthour for a transmission charge and 1
mill per kilowatthour for difficult to quantify energy
related costs) plus any transmission losses.
4.42 When Wabash Valley is the supplying party, a
payment of 100 percent of the amount paid to such Third
Party plus 2.0 ▇▇▇▇▇ per kilowatthour plus any
transmission losses.
EXHIBIT IV
SERVICE SCHEDULE D
SHORT TERM POWER
Under Interconnection Agreement dated October 7, 1987 between
Indianapolis Power & Light Company and
Wabash Valley Power Association, Inc. (the "Agreement")
SECTION 1 - DEFINITIONS
1.1 The meaning of the terms used herein shall be the same
as those used in the Agreement.
SECTION 2 - DURATION
2.1 This Service Schedule shall become effective as of the
Effective Date of the Agreement and shall continue in effect
until termination of the Agreement.
SECTION 3 - SERVICES TO BE RENDERED
3.1 Either Party, by giving the other Party sufficient
notice, may reserve for periods of one or more days or weeks,
such electric power (herein called "Short Term Power") as the
supplying Party at that time may have and is willing to
supply as Short Term Power. The Party asked to supply Short
Term Power shall be the sole judge as to the amounts and
periods that it has electric power available that may be
reserved by the other Party as Short Term Power. As used
herein, the term "week" shall mean any seven consecutive
days.
3.2 The Party desiring to reserve Short Term Power shall
specify in a notice to the other Party the number of
kilowatts and the period for which it desires to reserve such
power and the desired delivery schedule for such power. The
supplying Party shall promptly acknowledge receipt of such
notice and, shall signify the extent of its ability and
willingness to supply power in accordance with the provisions
of such notice. Any such notice or acknowledgement thereof
initially may be given orally; however if requested by either
Party, it shall be confirmed in writing and such confirmation
shall be forwarded not later than the third day following the
day such oral notice is given, excluding Saturdays, Sundays
and holidays.
3.3 During the period that Short Term Power has been
reserved as provided in Section 3.2 above, the supplying
Party shall deliver upon call electric energy (herein called
"Short Term Energy") to the other Party at the Point or
Points of Interconnection set forth in Section 5.01 of the
Agreement in the amounts not to exceed the number of
kilowatts reserved. However, in the event conditions arise
during such period which could not have been reasonably
foreseen and such conditions would cause the delivery of said
power to be burdensome to the supplying Party, such Party
shall have the right to request the other Party to reduce for
any portion of such period the amount of Short Term Energy
being taken to that amount specified by the supplying Party.
The purchasing Party shall promptly comply with such
requirements of the supplying Party.
SECTION 4 - COMPENSATION
4.1 The Party reserving Weekly or Daily Short Term Power
shall pay the supplying Party the following demand charges:
4.11 WEEKLY SHORT TERM POWER
(a) When IPL is the supplying Party, Wabash Valley
shall pay IPL for Weekly Short Term Power at the rate of
up to $1.05 per kilowatt reserved per week.
(b) When Wabash Valley is the supplying Party, IPL
shall pay Wabash Valley for Weekly Short Term Power at
the rate of up to $1.05 per kilowatt reserved per week.
(c) In the event the amount of Weekly Short Term Power
reserved is reduced upon notice from the supplying
Party, the demand charge for each day during which any
such reduction is in effect shall be reduced by one-
sixth (1/6) of the supplying Party's weekly demand rate
per kilowatt for each kilowatt of reduction but not more
than the rate agreed upon for each kilowatt per week.
4.12 DAILY SHORT TERM POWER
(a) When IPL is the supplying Party, Wabash Valley
shall pay IPL for Daily Short Term Power at the rate of
up to $.21 per kilowatt reserved per day.
(b) When Wabash Valley is the supplying Party, IPL
shall pay Wabash Valley for Daily Short Term Power at
the rate of up to $.21 per kilowatt reserved per day.
(c) In the event the amount of Daily Short Term Power
reserved is reduced upon notice from the supplying
Party, the demand charge per kilowatt for each day
during which any such reduction is in effect shall be
waived for each kilowatt of reduction.
4.13 THIRD PARTY WEEKLY SHORT TERM POWER
(a) For any week that Weekly Short Term Power is
reserved by IPL for and at the request of Wabash Valley
from a Third Party, such Short Term Power shall be
supplied at the rate of up to $.295 per kilowatt
reserved per week plus the demand charge paid therefor
by IPL to the Third Party.
(b) For any week that Weekly Short Term Power is
reserved by Wabash Valley for and at the request of IPL
from a Third Party, such Short Term Power shall be
supplied at the rate of $.12 per kilowatt reserved per
week plus the demand charge paid therefor by Wabash
Valley to the Third Party.
(c) In the event the amount of Weekly Short Term Power
reserved from a Third Party is reduced upon the request
of the Third Party, the demand charge for each day
during which such reduction is in effect shall be
reduced by the amount by which the demand charge payable
by the supplying Party is reduced under its Agreement
with such Third Party plus, in the case of Power
reserved by IPL, one-sixth of the rate per kilowatt
agreed to under Paragraph (a) of this Section 4.13 for
each kilowatt of reduction each day; but not more than
the rate agreed upon for each kilowatt per week; and, in
the case of Power reserved by Wabash Valley, one-sixth
of the rate per kilowatt stated in Paragraph (b) of this
Section 4.13 for each kilowatt of reduction each day;
but not more than the rate agreed upon for each kilowatt
per week.
4.14 THIRD PARTY DAILY SHORT TERM POWER
(a) For any day that Short Term Power is reserved by
IPL for and at the request of Wabash Valley from a Third
Party, such Short Term Power shall be supplied at the
rate of up to $.059 per kilowatt reserved per day plus
the demand charge paid therefor by IPL to the Third
Party.
(b) For any day that Short Term Power is reserved by
Wabash Valley for and at the request of IPL from a Third
Party, such Short Term Power shall be supplied at the
rate of $.02 per kilowatt reserved per day plus the
demand charge paid therefor by Wabash Valley to the
Third Party.
(c) In the event that the amount of Daily Short Term
Power reserved from a Third Party is reduced upon the
request of the Third Party, the demand charge for such
Power shall be reduced by the amount by which the demand
charge payable by the supplying Party is reduced by the
Third Party.
4.2 The reserving Party shall pay the supplying Party for
all Weekly or Daily Short Term Energy delivered at the
following rates:
(a) For each kilowatthour that is generated by the
supplying Party's system, 100 percent of the Out-of-
Pocket Costs of supplying Short Term Energy called for
during such period, plus 10 percent of such costs.
(b) For each kilowatthour purchased by IPL from a Third
Party in order to supply the Short Term Energy called
for during such period, 100 percent of the amount of the
Energy charge paid therefor by IPL plus 1 mill per
kilowatthour plus any transmission losses.
(c) For each kilowatthour purchased by Wabash Valley
from a Third Party in order to supply the Short Term
Energy called for during such period, 100 percent of the
amount of Energy charge paid therefor by Wabash Valley
plus 1 mill per kilowatthour plus any transmission
losses.
EXHIBIT V
SERVICE SCHEDULE E
LIMITED TERM POWER (FIRM)
Under Interconnection Agreement dated October 7, 1987 between
Indianapolis Power & Light Company and
Wabash Valley Power Association, Inc. (the "Agreement")
SECTION 1 - DEFINITIONS
1.1 The meaning of the terms used herein shall be the same
as those used in the Agreement.
SECTION 2 - DURATION
2.1 This Service Schedule shall become effective as of the
Effective Date of the Agreement and shall continue in effect
until termination of the Agreement.
SECTION 3 - SERVICES TO BE RENDERED
3.1 Either Party, by giving the other Party notice, may
reserve for periods of not less than one (1) nor more than
twelve (12) months, such electric power [herein called
"Limited Term Power (Firm)"] as the other Party may be
willing to make available as Limited Term Power (Firm). The
Party asked to supply Limited Term Power (Firm) shall be the
sole judge as to the amounts and periods that it has electric
power available that may be reserved by the other Party as
Limited Term Power (Firm).
3.11 To reserve Limited Term Power (Firm) the Party
desiring such power shall specify in its notice to the
supplying Party the number of kilowatts and the period
for which it desires to so reserve such power. The
supplying Party shall signify the extent of its ability
and willingness to comply with the provisions of such
notice. Any notice or any acknowledgement of such
notice that initially may be given orally shall be
confirmed thereafter in writing.
3.12 During each period that Limited Term Power (Firm)
has been reserved as provided, the supplying Party shall
deliver upon call electric energy [herein called Limited
Term Energy (Firm)] to the other Party at the Point or
Points of Interconnection set forth in Section 5.01 of
Article 5 of the Agreement in any amount up to and
including the number of kilowatts reserved. However, in
the event conditions arise during such period which
could not have been reasonably foreseen at the time said
power was reserved and such conditions would cause the
delivery of Limited Term Energy (Firm) to be burdensome
to the supplying Party, the supplying Party may, upon
notice to the reserving Party, reduce or interrupt the
delivery of such energy to preserve the integrity of, or
to prevent or limit any instability on, its system.
3.13 The Limited Term Power (Firm) billing demand for
any period shall be taken as equal to the number of
kilowatts reserved as Limited Term Power (Firm) for such
period.
SECTION 4 - COMPENSATION
4.1 The Party reserving Limited Term Power (Firm) shall pay
the supplying Party the following demand charges:
4.11 MONTHLY LIMITED TERM POWER (FIRM)
(a) When IPL is the supplying Party, Wabash Valley
shall pay IPL for Monthly Limited Term Power (Firm) at
the rate of up to $5.50 per kilowatt reserved per month.
(b) When Wabash Valley is the supplying Party, IPL
shall pay Wabash Valley for Monthly Limited Term Power
(Firm) at the rate of up to $9.43 per kilowatt reserved
per month.
(c) In the event the amount of Monthly Limited Term
Power (Firm) taken is reduced upon notice from the
supplying Party, the demand charge for each day during
which any such reduction is in effect shall be reduced
by one-twentieth (1/20) of the supplying Party's monthly
demand rate per kilowatt for each kilowatt of reduction
but not more than the rate agreed upon for each kilowatt
per month.
4.12 THIRD PARTY LIMITED TERM POWER (FIRM)
(a) For any month that Monthly Limited Term Power
(Firm) is reserved by IPL for and at the request of
Wabash Valley from a Third Party, such Monthly Limited
Term Power (Firm) shall be supplied at the rate of up to
$1.28 per kilowatt reserved per month plus the demand
charge paid therefor by IPL to the Third Party.
(b) For any month that Monthly Limited Term Power
(Firm) is reserved by Wabash Valley for and at the
request of IPL from a Third Party, such Monthly Limited
Term Power (Firm) shall be supplied at the rate of up to
$1.20 per kilowatt reserved per month plus the demand
charge paid therefor by Wabash Valley to the Third
Party.
(c) In the event the amount of Monthly Limited Term
Power (Firm) reserved from a Third Party is reduced upon
the request of the Third Party, the demand charge for
each day during which reduction is in effect shall be
reduced by the amount by which the demand charge payable
by the supplying Party is reduced under its Agreement
with such Third Party plus, in the case of Power
reserved by IPL one-thirtieth (1/30) of the rate per
kilowatt agreed to under Paragraph (a) of this Section
4.12 for each kilowatt of reduction each day; but not
more than the rate agreed upon for each kilowatt per
month; and, in the case of Power reserved by Wabash
Valley, one-thirtieth (1/30) of the rate per kilowatt
agreed to under Paragraph (b) of this Section 4.12 for
each kilowatt of reduction each day; but not more than
the rate agreed upon for each kilowatt per week.
4.2 The reserving Party shall pay the supplying Party for
all Limited Term Energy (Firm) delivered at the following
rates:
(a) For each kilowatthour that is generated by the
supplying Party's system, 100 percent of the Out-of-
Pocket Costs of supplying Limited Term Energy (Firm)
called for during such period, plus 10 percent of such
costs.
(b) For each kilowatthour purchased by IPL from a third
Party in order to supply the Limited Term Energy called
for during such period, 100 percent of the amount of the
Energy charge paid therefor by IPL plus 1 mill per
kilowatthour plus any transmission losses.
(c) For each kilowatthour purchased by Wabash Valley
from a Third Party in order to supply the Limited Term
Energy (Firm) called for during such period, 100 percent
of the amount of the Energy charge paid therefor by
Wabash Valley plus 1 mill per kilowatthour plus any
transmission losses.
EXHIBIT VI
SERVICE SCHEDULE F
DIVERSITY POWER
Under Interconnection Agreement dated October 7, 1987 between
Indianapolis Power & Light Company and
Wabash Valley Power Association, Inc. (the "Agreement")
SECTION 1 - DEFINITIONS
1.1 The meaning of the terms used herein shall be the same
as those used in the Agreement.
SECTION 2 - DURATION
2.1 This Service Schedule shall become effective as of the
Effective Date of the Agreement and shall continue in effect
until termination of the Agreement.
SECTION 3 - DIVERSITY POWER
3.1 From time to time, because of differences in load
patterns a Party may have excess capacity during one Seasonal
Load Period at the same time the other Party is experiencing
its peak load season. At such time it may be to the Parties'
mutual advantage to schedule an exchange of certain portions
of any such excess capacity. Such capacity shall be termed
and is herein called "Diversity Power".
3.11 Seasonal Load Period shall mean for the Summer
Seasonal Load Period, the months of April thru September
and for the Winter Seasonal Load Period, the months of
October thru March.
3.2 At any time Diversity Power transactions are agreed upon
between the Parties, the Party which purchases Diversity
Power during one Seasonal Load Period shall be obligated to
have available a like amount of Diversity Power for the other
Party during the other Seasonal Load Period.
3.3 The Party supplying Diversity Power shall provide
reserve capacity for the committed amount, equivalent to that
provided for its own customers, exclusive of customers with
interruptible service contracts.
SECTION 4 - COMPENSATION
4.1 Demand Charges - There shall be no demand charge for
Diversity Power.
4.2 Energy Charges - Energy shall be billed at Out-of-Pocket
Cost of the supplying Party plus ten percent of such cost.
In the event that any part of the Out-of-Pocket Cost includes
energy purchased by the supplying Party, only the energy
related portion of such purchase cost shall be included. Any
associated charges for demand related costs shall be
excluded.
MODIFICATION NO. 1
TO THE
INTERCONNECTION AGREEMENT
BETWEEN
INDIANAPOLIS POWER & LIGHT COMPANY
AND
WABASH VALLEY POWER ASSOCIATION, INC.
THIS AMENDMENT made and entered into as of the 1st day of
January, 1995 by Indianapolis Power & Light Company ("IPL"),
being an Amendment to the Interconnection Agreement between
Wabash Valley Power Association, Inc. ("Buyer") and IPL dated
October 7, 1987 (the "Agreement").
WITNESSETH:
WHEREAS, IPL and Wabash Valley Power Association, Inc.,
entered into the Agreement on October 7, 1987, which
Agreement has been amended from time to time;
WHEREAS, the Agreement provides for the sale of power and
energy by IPL under Service Schedules described as:
Service Schedule A Emergency Service
Service Schedule C Interchange Power
Service Schedule D Short-Term Power
Service Schedule E Limited-Term Power
Service Schedule F Diversity Power
WHEREAS, the Agreement provides for the recovery of
incremental costs or "out-of-pocket" costs occasioned by the
sale by IPL of electric energy;
WHEREAS, IPL has implemented its Emissions Constrained
Dispatch Plan, attached hereto;
WHEREAS, the rates for Emergency Service, Interchange Power,
Short-Term Power, Limited-Term Power, and Diversity Power, do
not expressly include the cost of replacing sulfur dioxide
("SO2") emission allowances expended in order to provide such
energy in compliance with Federal laws governing SO2
emission;
WHEREAS, IPL desires to amend the Agreement to clarify
recovery of out-of-pocket costs occasioned by the sale of
said energy as including the recovery of the incremental cost
of SO2 emission allowances;
NOW, THEREFORE, in consideration of the premises and the
terms and conditions set forth herein; IPL desires to amend
the Agreement as follows:
Section 1. Compensation for SO2 Emission Allowances.
The Buyer shall compensate IPL for the consumption of Sulfur
Dioxide Emissions Allowances ("SO2 Allowances") directly
attributed to electric energy sales by IPL to Buyer under the
Service Schedules. Such compensation shall, at Buyer's
option, be made by either supplying IPL with the number of
SO2 Allowances directly attributed to such energy sales, or
by reimbursing IPL for the incremental cost of such number of
SO2 Allowances, rounded to the nearest whole SO2 Allowance.
If Buyer opts to reimburse IPL in cash for SO2 Allowances
associated with Buyer's energy purchases for the month, the
cash amount due at billing will be determined by multiplying
the number of SO2 Allowances attributed to the sale by the
incremental cost of the SO2 Allowances, as determined in
Section 2.2, at the time of the sale.
If Buyer opts to reimburse IPL in SO2 Allowances, Buyer will
record or transfer to IPL's account, the number of SO2
Allowances calculated below, at the time cash settlement for
the energy is due. In all cases, Buyer will transfer to
IPL's account the number of SO2 Allowances due IPL for
calendar year no later than January 15 of the following year.
"Transfer to IPL's account" shall mean, for purposes of the
Amendment, the transfer by the USEPA of the requisite number
of SO2 Allowances to IPL's Allowance Tracking System account
and the receipt by IPL of the Allowance Transfer
Confirmation.
Section 2. Determination of SO2 Emission Allowances Due IPL.
Section 2.1. Number of SO2 Allowances
The number of SO2 Allowances directly attributed to an
energy sale made by IPL shall be determined for each
hour, by determining the contribution from each of the
unit(s) from which the energy sale is being made for
that hour. For each unit, the emission rate in pounds
of SO2 per million Btu will be determined each month,
from fuel sulfur content, control equipment performance,
and continuous emissions monitoring data. The emission
rate and the unit heat rate will be used to determine
the SO2 Allowances used per megawatt-hour ("MWH"). The
energy from each unit attributable to the sale, and the
SO2 Allowances per MWH for each unit, will be used to
determine the number of SO2 Allowances attributable to
the sale.
Section 2.2 . Cost of SO2 Allowances
The incremental SO2 Allowance cost used to determine
economic dispatch of IPL's generating units in any
month, will also be the basis used to determine
compensation for IPL's energy sales. The incremental
SO2 Allowances cost, in dollars per ton of SO2, shall be
determined each month and will be based on the Cantor
▇▇▇▇▇▇▇▇▇▇ offer price for SO2 Allowances, or if such
is not available, then another nationally recognized SO2
Allowance trading market price or market price index, at
the beginning of the month. The SO2 Allowance value may
be changed at any time during the month to reflect the
more current incremental cost, or market price, for SO2
Allowances. Buyer will be notified of the new SO2
Allowance value prior to dispatch of IPL energy to
Buyer.
Section 3. Effective Date.
This Amendment to the Agreement shall be made effective as of
January 1, 1995.
IN WITNESS WHEREOF, IPL has caused the foregoing Amendment to
be signed by its duly authorized officer, effective as of the
date set forth above.
INDIANAPOLIS POWER & LIGHT COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Vice President
Resource Planning and Rates
MODIFICATION NO. 2
TO THE
INTERCONNECTION AGREEMENT
BETWEEN
INDIANAPOLIS POWER & LIGHT COMPANY
AND
WABASH VALLEY POWER ASSOCIATION, INC.
Effective as of
MODIFICATION NO. 2
TO THE
INTERCONNECTION AGREEMENT
BETWEEN
INDIANAPOLIS POWER & LIGHT COMPANY
AND
WABASH VALLEY POWER ASSOCIATION, INC.
Pursuant to Order No. 888, Indianapolis Power & Light
Company (IPL) restates the rates for service provided by IPL
under the Interconnection Agreement as the following:
1) The Interconnection Agreement provides for IPL sales of
capacity and energy under service schedules described as:
Service Schedule A - Emergency Service
Service Schedule C - Interchange Power
Service Schedule D - Short-Term Power
Service Schedule E - Limited Term Power (Firm)
Service Schedule F - Diversity Power
2) The wholesale generation component of the rate applicable to
service under these Service Schedules shall be the bundled rate
minus the transmission and ancillary service rates provided in
Section 3 of this Modification.
Where the Service Schedules provide for compensation to IPL
in the form of equivalent energy, such return of equivalent
energy shall be made of the generation component, with the
transmission and ancillary services related to such return of
equivalent energy arranged pursuant to and assessed as provided
in Section 3 of this Modification.
Service Schedule C provides for compensation to IPL
regarding third party sale and resale transactions of Non-
Displacement Energy in the form of a stated transmission charge
plus "one mill per kilowatt-hour for difficult to quantify energy
related costs." Service Schedule C is hereby revised to remove
the term "one mill per kilowatt-hour for difficult to quantify
energy related costs."
3) Transmission and ancillary services necessary to effectuate
sales under the Interconnection Agreement shall be arranged by
IPL under and subject to the rates, terms, and conditions of
IPL's Open Access Transmission Tariff. The rates for point-to-
point transmission service and the two ancillary services
necessary to effectuate sales under the Interconnection Agreement
are provided below. IPL will provide either Short-Term Firm
Point-to-Point or Non-Firm Point-to-Point transmission service
and ancillary services for Scheduling, System Control and
Dispatch Service (Scheduling Service), and Reactive Supply and
Voltage Control from Generation Sources Service (Reactive Supply
Service). IPL will not provide Regulation and Frequency Response
Service, Energy Imbalance Service, Operating Reserve-Spinning
Reserve Service, or Operating Reserve-Supplemental Reserve
Service in connection with the sales under the Interconnection
Agreement, and there will be no charge for such services in
connection with the sales under the Interconnection Agreement.
The rates for both Short-Term Firm and Non-Firm Point-to-
Point Service are: $ 930.00/MW of reserved capacity for monthly
service, $215.00/MW of reserved capacity for weekly service,
$43.00/MW of reserved capacity for on-peak daily, and $30.70/MW
of reserved capacity for off-peak daily service with the daily
service capacity charges capped at the weekly rates. Non-Firm
Point-to-Point service is available on an hourly basis at
$2.69/MW for on-peak hours and $1.28/MWH for off-peak hours with
the maximum hourly charges capped at the daily rates.
For Scheduling Service, the monthly charges are $10.00/MW of
reservation, the weekly rate is $3.00/MW, the daily rate is
$0.60/MW, and the hourly rate is $0.04/MWH. The sum of the
hourly charges is capped at the daily rates, the sum of the daily
charges is capped at the weekly rate, and the sum of the weekly
charges is capped at the monthly rate.
For Reactive Supply Service, the monthly charges are
$110.00/MW of reservation, the weekly rate is $25.00/MW, the
daily rate is $5.00/MW, and the hourly rate is $0.31/MWH. The
sum of the hourly charges is capped at the daily rates, the sum
of the daily charges is capped at the weekly rate, and the sum of
the weekly charges is capped at the monthly rate.
If transmission and ancillary services are obtained by
Wabash Valley Power Association, Inc. under Indianapolis Power &
Light Company's Open Access Transmission Tariff, there will be no
charge related to transmission and ancillary service assessed
under the Interconnection Agreement. A service agreement under
Indianapolis Power & Light Company's Open Access Transmission
Tariff is on file as of the effective date of this Modification
No. 2 to govern service to Wabash Valley Power Association, Inc.
for this power sale, and charges for transmission and ancillary
services for this power sale will be assessed to Wabash Valley
Power Association, Inc. under the Open Access Transmission
Tariff.