EXHIBIT 10.39
AMENDMENT NO 2.
TO
THE POWER PURCHASE AND OPERATING AGREEMENT
BETWEEN
PANDA-▇▇▇▇▇▇▇▇. L.P.
AND
VIRGINIA ELECTRIC AND POWER COMPANY
This Amendment No. 2 (hereinafter the "Amendment")
effective as of July 30, 1993, is by and between PANDA-
ROSEMARY, L.P., ("Operator") a Delaware limited
partnership, and VIRGINIA ELECTRIC AND POWER COMPANY
("North Carolina Power" or the "Company"), a Virginia
public service corporation.
RECITALS
WHEREAS, Operator and North Carolina Power are parties
to a Power Purchase and Operating Agreement dated
January 24, 1989, originally entered into between Panda
Energy Corporation and North Carolina Power and subsequently
assigned to Panda-▇▇▇▇▇▇▇▇ Corporation May 15, 1989 and
amended with Amendment No. 1 effective October 1, 1989
(such Agreement as amended by Amendment No.1. is hereafter
referred to as the "Agreement"); and
WHEREAS, the Agreement was assigned as of January
6, 1992 to Operator; and
WHEREAS, the Agreement contains a provision that
allows Operator and North Carolina Power to redetermine
the Base Gas Index, the Composite Gas Index, and/or the
fuel component of the Base Fuel Compensation Price; and
WHEREAS, Operator and North Carolina Power have
redetermined the Energy Purchase Price and now wish to
amend certain provisions of the Agreement;
NOW, THEREFORE, in consideration of the mutual
promises and obligations stated herein, Operator and North
Carolina Power do hereby agree to amend the Agreement as
follows:
(1) In Section 1.10, first sentence, lines 6 and 7,
delete the words "thirty-five (35) percent of the Dependable
Capacity or fifty (50) percent to Seventy-five (75)" and
insert the words "nineteen (19) percent of the Dependable
Capacity, twentyfour (24) percent to fifty-four (54) percent
of the Dependable Capacity, or sixty-five (65) percent to
eighty (80)"
(2) Section 10.2, is hereby deleted in its entirety
and replaced with the following:
"Unless the provisions of Sections 10.4 or 10.6 are in
effect, during the Months of April, May, June, July, August,
September, and October, the Fuel Compensation Price shall
be equal to the Summer Gas Compensation Price ("SGCP").
During the months of November, December, and March, the
Fuel Compensation Price shall be equal to the Winter Gas
Compensation Price ("WGCP"). During the months of January
and February, the Fuel Compensation Price shall be equal to
the Winter Oil Price ("WOP"). In each case, the Heat Rate
shall be 8900 Btu/kWh ("Contract Heat Rate"). The Energy
Purchase Price shall be calculated using the formula:
Energy Purchase Price
8,900 Btu/kWh
= [(Fuel Compensation Price)( ------------)] + O&M
1,000,000
Price specified in Section 10.14 where,
Fuel Compensation Price is in cents/mmBtu, and Variable O&M
Price specified in Section 10.14 is in cents/kWh."
(3) Section 10.3, is hereby deleted in its entirety
and replaced with the following:
"(a) During the Months when the Fuel Compensation Price
shall be set equal to the SGCP, the SGCP shall be
calculated using the formula (See Exhibit B, Example
1):
1 1
SGCP = [(((1-SR1)(1-SR2))+0.03)(SSG)] + SGT
where,
SR1 = the latest published Transco tariff retainage
value issued prior to and effective on the first day of
the applicable Month for Transco Zone 3-5 Interruptible
Transportation;
SR2 = the North Carolina Natural Gas (NCNG) tariff
retainage fixed at 2%;
SSG = Summer Spot Gas for the applicable Month
is the arithmetic average of prices determined as of the
first of that Month for (i) the Transco Zone 3 Index Price
for Spot Gas delivered to pipelines as published in the
first issue of either Inside FERC's Gas Market Report,
or Inside FERC's Gas Market Report Special Report,
whichever is published first, as appropriate; (ii) the
contract index price for spot gas delivered to pipelines
under the heading "Columbia - Rayne" as published in
Natural Gas Intelligence Gas Price Index; and (iii) the bid
week price for the Month in question, for Transcontinental
Gas Pipe Line Corp., Zone 3 as published in Natural Gas
Week in the table Spot Prices on Interstate Pipeline
Systems; and
SGT = Summer Gas Transportation for the applicable
Month is the sum of (i) the latest published Transco
tariff charges, including applicable surcharges, issued
prior to and effective on the first of the Month, for
Transco Zone 3-5 Interruptible Transportation; (ii)
$0.25, adjusted monthly beginning August 1, 1993 by the
percentage change between the index values for the Months
four and five Months prior to the applicable Month, of the
Consumer Price Index for All Urban Consumers, U. S. City
Average, as first published in Table 1 of the CPI Detailed
Report, in the row titled, "All Items", under the column
heading "Unadjusted percent change to (date) from"; and
(iii) $0.04. All references to Transco "published
tariffs" in this Section 10.3 shall refer to amounts
reported on the Transco electronic bulletin board,
"TRANSIT"; provided however, that if there is any dispute
as to the accuracy of such amounts, the term "published
tariffs" shall mean those tariff(s) filed by Transco at the
FERC.
(b) During the Months where the Fuel Compensation Price
shall be set equal to the Winter Gas Compensation
Price, the WGCP shall be calculated using the formula
(See Exhibit B, Example 2):
1 1 1
WGCP = [(((1-WR1)(1-WR2)(1-WR3))+0.03)(WSG)] + WGT
where,
WR1 = the latest published Transco tariff retainage
value issued prior to and effective on the first day of
the applicable Month for Transco ▇▇▇▇ ▇-▇ (▇▇▇▇ ▇▇▇▇▇,
▇▇. to Pleasant Hill, N.C.), Interruptible Transportation;
WR2 = the latest published CNG tariff retainage value
issued prior to and effective on the first day of the
applicable Month for CNG Interruptible Transportation;
WR3 = the North Carolina Natural Gas tariff retainage fixed
at 2%;
WSG = Winter Spot Gas for the applicable Month
is the arithmetic average of prices determined as of the
first of that Month for (i) the CNG Appalachia Index Price
for Spot Gas delivered to pipelines as published in the
first monthly issue Inside FERC's Gas Market Report, or
Inside FERC's Gas Market Report - Special Report, as
appropriate; and (ii) the contract index price for spot
gas delivered to pipelines under the heading "Appalachia -
CNG" as published in Natural Gas Intelligence Gas Price
Index; and
WGT = Winter Gas Transportation for the applicable
Month is the sum of (i) the latest published Transco
tariff charges, including applicable surcharges, issued
prior to and effective, on the first of the Month, for
Transco ▇▇▇▇ ▇-▇ (▇▇▇▇ ▇▇▇▇▇, ▇▇. to ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.)
Interruptible Transportation; plus (ii) the latest
published CNG tariff charges, including applicable
surcharges, issued prior to and effective, on the first day
of the Month for CNG Interruptible Transportation; plus
(iii) $0.25, adjusted monthly beginning August 1, 1993 by
the percentage change between the index values for the Months
four and five Months prior to the applicable Month, of the Consumer
Price Index for All Urban Consumers, U. S. City Average as
first published in Table 1 of the CPI Detailed Report,
in the row titled "All Items", under the column heading
"Unadjusted percent change to (date) from"; and (iv) $0.04.
In addition to the WGCP, Operator will be paid a
startup fee for each "Start-up" during the Months of
November, December, and March, except as set forth
below. For the purpose of this Agreement, Start-up shall
mean each time the Facility produces Net Electrical Output
following zero Net Electrical Output, or each time the
Facility is Dispatched to continue delivery of Net
Electrical Output after Company delivers gas pursuant to
Section 10.4. The start-up fee (SF) shall be determined
using the following formula (See Exhibit B, Example 3);
SF = $38,286.00(WOP - WGCP)
where,
WOP = Winter Oil Price, using the same formula
specified in Section 10.3(c) below, but for the Months of
November, December, and March; and
WGCP = Winter Gas Compensation Price, as
determined in this Section 10.3(b). Payment of the
start-up fee will accrue upon each Start-up, and will
be made with the regular monthly billing. Payment of
the start-up fee shall be contingent upon Operator's
compliance with North Carolina Power's Dispatch and
the Design Limits of the Facility. If the Facility
operates in accordance with North Carolina Power's
Dispatch for the lesser of North Carolina Power's
Dispatch or twenty-four (24) hours and then experiences
an off-line Forced Outage, Operator will receive
payment of a start-up fee. Operator will not receive
the start-up fee for (i) any periods of time Operator
requests North Carolina Power to receive Net
Electrical Output and North Carolina Power agrees to
accept such Net Electrical Output when North Carolina
Power would not have otherwise Dispatched the
Facility to deliver such Net Electrical Output; (ii)
the first test, or Operator requested tests, for
Dependable Capacity during any Winter Period; and (iii)
Start-up following a Forced Outage that resulted from
the Facility delivering to North Carolina Power zero
Net Electrical Output during a period of time the
Facility was Dispatched to deliver Net Electrical
Output to North Carolina Power where (x) a start-up
fee has already accrued for such Dispatch period or
(y) the Start-up for such Dispatch period occurred in
a Month other than November, December, or March. The
total Fuel Compensation Price, plus the start-up
fee, for Net Electrical Output delivered during the
Dispatch period shall not exceed the WOP as determined
for the Months of November, December, and March.
(c) During the Months where the Fuel Compensation Price
shall be set equal to the Winter Oil Price, the WOP
shall be calculated using the formula:
WOP = ($4.45/mmBtu)(OI)
where,
OI = Oil Index which will be based on prices
reported in ▇▇▇▇▇'▇ Oilgram Price Report in the U.S. Tank
Car/Truck Transport table for No. 2 fuel oil. The index
will be the sum of the most recently reported average of
low and high prices on No. 2 fuel oil delivered to
Greensboro and Norfolk, determined as set forth below,
divided by 114.49 cents/gallon (which is the sum of the
average of the low and high prices for No. 2 fuel oil for
the same locations as published in each Wednesday's ▇▇▇▇▇'▇
Oilgram during the month of December 1992). In calculating
the numerator for the Oil Index for the current month,
the average price for No. 2 fuel oil delivered to each
location, will be determined using the values published in
each Wednesday's ▇▇▇▇▇'▇ Oilgram for the preceding Month,
i.e. that is January's price would be determined by prices
reported in December."
(4) Section 10.4, is hereby deleted in its
entirety and replaced with the following:
"(a) Subject to the provisions of Sections 10.2, 10.3. and
10.6, North Carolina may, at its election and in compliance
with the restrictions and provisions set forth below, supply
gas to the Facility during periods when North Carolina Power
is able to obtain sufficient quantities of gas to allow
Operator to meet North Carolina Power's Dispatch in a
manner consistent with the Facility's Design Limits.
North Carolina Power shall contact Operator each Friday
morning and advise Operator of North Carolina Power's
plans to supply the Facility with gas for the following
week, including any actual arrangements committed to as
well as additional arrangements being considered. Operator
shall use its best efforts to accept and consume North
Carolina Power's gas, except Operator shall be under no
duty to accept deliveries of natural gas for the
production of Net Electrical Output if the Facility
was projected by North Carolina Power on Friday of the
previous week to be Dispatched on-line at the Energy
Purchase Price or the price Operator has nominated
pursuant to Section 10.6; provided, however, Operator shall
be obligated to produce Net Electrical Output in
accordance with Dispatch from North Carolina Power
delivered natural gas if one of the following conditions
exist:
(x) the Company has an identifiable off system
power sale opportunity and the Company has, within a
reasonable time after having identified such off-system
power sale opportunity, provided notice thereof to
Operator, or (y) the Company has gas available as a
result of a forced outage at a Company natural gas
turbine facility and the Company has provided, within a
reasonable time after such forced outage, notice thereof to
Operator, or (z) the Company has scheduled an outage of
a Company natural gas turbine facility and the Company
has given Operator at least 30 days notice prior to
delivery of natural gas. (b) Notwithstanding anything in
this Agreement to the contrary, Operator shall not be
required to accept deliveries of gas from North Carolina
Power if (i) the consumption and/or acceptance of such
gas would cause Operator to breach or violate any
statute, regulation or permit applicable to the Facility,
or (ii) Dispatch of the Facility would transgress any
other provision of this Agreement. If it is found that
acceptance and/or consumption of such gas will be in
conflict with any of Operator's contracts, Operator shall
immediately advise North Carolina Power of such conflict.
In such event the parties will endeavor to resolve such
conflict; however, Operator shall not be required to accept
deliveries of natural gas until the conflict is resolved.
As of the execution of this Amendment, Operator is unaware
of any such conflict with any of its contracts.
(c) North Carolina Power shall pay Operator, for
the Net Electrical Output generated each day with gas
supplied by North Carolina Power, an amount equal to the
Converted Energy Purchase Price, as adjusted by sub-
section 10.4(k) hereof, in lieu of payment of the
Energy Purchase Price pursuant to Sections 10.1 through
10.3. For purposes of this section, the Converted Energy
Purchase Price shall be calculated as follows:
CEPP = NEO [O&M + (Heat Rate * (MGT Fee + PO Fee))]
+ [(DN Fee)(#Days gas supplied)]
where,
"CEPP" = Converted Energy Purchase Price
"NEO" = Net Electrical Output, expressed in kWh and
defined in Section 1.28
"O&M" = 0&M Price specified in section 10.14
"Heat Rate" = .0089 MMBtu/kWh
"MGT Fee" = The management fee of 4 cents/MMBtu
"PO Fee" = The pipeline operating fee of 12 cents/MMBtu,
adjusted monthly beginning August 1, 1993 by the percentage
change between the index values for the Months four and
five Months prior to the applicable Month, of the
Consumer Price Index for All Urban Consumers, U. S. City
Average as first published in Table 1 of the CPI Detailed
Report, in the row titled "All Items", under the column
heading "Unadjusted percent change to (date) from"
"DN Fee" = The daily nomination cost of $450 each day
(d) On each day which North Carolina Power elects
to Dispatch the Facility on-line pursuant to this Section
10.4, (i) Operator will operate the Facility in accordance
with the terms of this Agreement, and (ii) North Carolina
Power will be obligated to deliver to Operator such
quantities of natural gas as are sufficient to allow
Operator to meet Dispatch during such day, based on the
Contract Heat Rate of 8900 Btu/kWh. The amount of natural
gas presumed to have been consumed by the Facility during
such day will be based on the following:
FC = NEO * Heat Rate
where,
"FC" = Fuel Consumed, the amount of natural gas presumed
to be consumed by the Facility during Dispatch under this
section, in MMBtu's.
"Heat Rate" = .0089 MMBtu/kWh
The actual adjusted amount of natural gas delivered to the
Facility at its Pleasant Hill measuring station shall be
based on the followinq:
FA = FS * (.98) where,
"FA" = Fuel Accepted, the amount of natural gas actually
placed into the Facility's pipeline adjusted by NCNG's 2%
retainage tariff in MMBtu's.
"FS" = Fuel Supplied, the amount of natural gas
specified, in MMBtu's, in the monthly measurement
statements produced by Transcontinental Gas Pipeline Company
and/or Columbia Gas Transmission Corporation and allocated
as delivered by North Carolina Power.
Any positive difference between the Fuel Accepted
("FA") less the Fuel Consumed ("FC") ("Over Delivery") shall
be reconciled on a monthly basis as provided below in sub-
section 10.4(k)1.
Any negative difference between the Fuel Accepted ("FA")
less the Fuel Consumed ("FC") ("Under Delivery") shall be
reconciled on a monthly basis as provided below in sub-
section 10.4(k)2.
(e) To the extent that the quantity of natural gas
actually consumed at the Facility to generate the Net
Electrical Output produced by the Facility differs from
the quantity of natural gas presumed to have been
consumed at the Facility ("FC", as defined above),
Operator shall be responsible for any shortfall,
or shall be entitled to retain any surplus, of
natural gas.
(f) North Carolina Power may not exercise its election to
supply gas to the Facility unless the Facility will be
Dispatched to run for a minimum of 8 consecutive
hours.
(g) Except as provided for in Section 10.4(f) above, North
Carolina Power's Dispatch rights will not be affected
by gas deliveries made by North Carolina Power.
(h) North Carolina Power's natural gas shall be
delivered, and title to such natural gas will pass to Operator, at
Operator's Pleasant Hill measurement station. North
Carolina Power warrants title to all gas delivered to
Operator and is responsible for obtaining all necessary
regulatory authorizations.
(i) North Carolina Power's natural gas will be
delivered to Operator's Pleasant Hill measurement
station at no cost to Operator.
(j) North Carolina Power will indemnify and hold Operator
harmless from over and under deliveries of gas attributable
to North Carolina Power's movement of gas to the Facility on
interstate pipelines and such over and under deliveries will
be settled by North Carolina Power in a manner consistent
with the imbalance settlement provisions of the appropriate
pipeline(s).
(k) Over and Under deliveries of natural gas to
Operator (e.g., imbalances) attributable to North Carolina
Power's movement of gas to the Facility will be settled
monthly as follows:
1. Over Delivery of natural gas by North Carolina Power
to Operator will be credited to the Company on the
monthly billing at a rate equal to the average of
Transco's average cash-in/cash-out tied to Zone 3 IT
(See Exhibit B), including associated transport
costs and retainage factor, for such month the Over
Delivery occurs (See Exhibit B, Example 4).
2 . Under Delivery of natural gas by North Carolina
Power to Operator will be credited to Operator on the
monthly billing at a rate equal to the average of Transco's
average cash-in/cash-out tied to Zone 3 IT (See Exhibit B),
including associated transport costs and retainage factor,
for such month the Under Delivery occurs (See Exhibit B,
Example 5).
(l) If the Facility has to shut down due to a loss of gas supply
from North Carolina Power, it shall not be construed as a
Forced Outage.
(m) If the Facility is Dispatched to continue delivery
of Net Electrical Output after North Carolina Power's
delivery of gas is completed, the Energy Purchase
Price in effect at the time shall then apply for
such additional generation. If this situation
occurs in the Months of November, December, and
March, Operator shall receive the start-up fee as set
forth in Section 10.3(b).
(n) Notwithstanding any other provision of this Agreement
including Section 15.1, North Carolina Power agrees to pay
any taxes applicable to the Company's supply of or transfer
of title to natural gas under this provision. If the new
taxes are levied on the sale of energy or the
combustion/consumption of natural gas, then the Company
shall i) pay such taxes applicable to the sale of energy
or the combustion/consumption of natural gas whenever it
elects to exercise its rights under this Section 10.4, or
(ii) forfeit its rights under this Section 10.4 to supply
gas to the Facility."
(5) Section 10.5, is hereby deleted in its
entirety and replaced with the following:
"If any Government index used to determine the Energy
Purchase Price is discontinued, an index specified by an
appropriate U.S. Government agency, if available, shall be
substituted for such discontinued Government index, and if
no such replacement government index is made available, a
new index shall be determined by agreement of the
Parties. In addition, if any publication, or index within
a publication, used to determine the Energy Purchase Price
is discontinued, a new publication or index shall be
determined by agreement of the Parties. If any of the
indices or publications specified herein are determined
by both Parties to no longer represent market conditions,
or if the basis of calculation of those published
indices or publications is substantially modified, the
indices or publications may be replaced by agreement of the
Parties, except, however, that changes in the base year(s)
reporting basis, minor changes in weighting and minor
changes in benchmarks shall not be construed as
substantial modifications of the indices or publications and
the affected values shall be reestablished in accordance
with the instructions of the appropriate Government agency
or publication."
(6) Section 10.6, is hereby deleted in its entirety
and replaced with the following:
"Operator may set an Energy Purchase Price that it
believes will increase the on-line Dispatch of the
Facility, under the following terms:
(a) Operator must notify North Carolina Power in writing
prior to the close of business at noon on Wednesday of
any week that a new Energy Purchase Price is
offered, and such new Energy Purchase Price will
be effective beginning 11:59 PM the following
Friday.
(b) The new Energy Purchase Price shall remain in effect
until Operator provides notice of a new Energy Purchase
Price, but not less than seven days. (c) The new Energy
Purchase Price shall not exceed the Energy Purchase Price
in effect pursuant to Section 10.1 through Section 10.3."
(7) Section 10.7, is hereby deleted in its entirety and replaced
with the following:
"Opportunities to redetermine the Fuel Compensation
Price shall begin on the third July 1 after the
Commercial Operations Date, and every third July 1,
thereafter. Such date shall hereafter be the
"Redetermination Date." Either Party must submit written
notice to the other Party requesting such redetermination
no less than four (4) Calendar Months prior to the
Redetermination Date. Such written notice shall include
any proposed change(s) and the basis for such change(s).
The Parties shall within 30 Days of the submittal of such
notice enter into good faith negotiations for the purpose
of revising the Fuel Compensation Price to reflect more
accurately the prices then prevailing in the market for
prudent purchases of natural gas. If such redetermination
is not complete within thirty (30) Days after the
Redetermination Date, such matter may be submitted to
binding arbitration as discussed in Section 10.8 below.
The exercise by a party of its right to redetermine the
Energy Purchase price, shall cause all rights and
obligations of this Amendment No. 2, other than this
Section 10.7, to be null and void as of the Redetermination
Date, and the parties' rights and obligations under the
Agreement dated January 24, 1989 (as amended by Amendment
No. 1) will be substituted therefore."
(8) Section 10.14, is hereby deleted in its entirety
and replaced with the following:
"North Carolina Power shall also pay Operator, on a
per kWh basis, a variable operation and maintenance
adjustment. This O&M Price shall be 0.20 cents/kWh in
1993 dollars and shall be increased or decreased, as
appropriate, on April 1, 1994, and on each April 1
thereafter by the change in the Gross Domestic Product
Implicit Price Deflator for the previous Calendar Year."
Operator is responsible for securing any approvals of
this Amendment from any Lender providing financing for the
Facility (as that term is defined in the Agreement) or
those entities that are parties to the Consent to
Assignment, Delegation and Assumption Agreement other than
North Carolina Power and will bear all costs of obtaining
such approvals. North Carolina Power shall be allowed to
rely on Operator's execution of this Amendment as evidence
that such approvals have been obtained.
Except as expressly modified hereby, all the terms and
conditions of the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their duly authorized
representatives as set forth below:
VIRGINIA ELECTRIC AND
POWER COMPANY PANDA-▇▇▇▇▇▇▇▇, L.P.
By:_____________________ By Its General Partner,
▇▇▇▇▇ ▇▇▇▇▇ Panda ▇▇▇▇▇▇▇▇ Corporation
Title: Senior Vice President By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Dated: September 1, 1993 Title: Chairman
Dated August 30, 1993
EXHIBIT B
NOTE: ALL VALUES USED IN EXAMPLES ARE FOR ILLUSTRATIVE
PURPOSES ONLY.
EXAMPLE 1 - Summer Gas Compensation Price
SSG (Summer Spot Gas) = Average of:
i) Inside FERC Index - Transco Zone 3 =$2.07/Dth
ii) Natural Gas Intell - Columbia Gulf at Rayne =$2.09/Dth
iii) Natural Gas Week Average Bid Wk - Transco Zone 3 =$2.09/Dth
SSG = $2.083/Dth
SGT (Summer Gas Transport):
i) $0.3635
ii) $0.2500
iii) $0.0400
$0.6535
SR1 = .0326
SR2 = .0200
1 1
SGCP = [(((1-SR1)(1-SR2))+0.03)(SSG)] + SGT
SGCP = [(((1-.0326)(1-.0200))+0.03)($2.083/Dth)] + $0.6535
SGCP = $2.914/Dth
EXAMPLE 2 - Winter Gas Compensation Price
WSG (Winter Spot Gas):
i) Inside FERC CNG Appalachia = $2.230
ii) Natural Gas Intell CNG Appalachia = $2.240
Average = $2.235
WR1 = Transco retainage = 1.97%
WR2 = CNG retainage = 2.28%
WR3 = NCNG retainage = 2.00%
WGT (Winter Gas Transportation):
i) Transco tariff =$.2676/Dth
ii) CNG IT tariff =$.2087/Dth
iii) NCNG tariff =$.2500/Dth
iv) Natural Gas Clearing House =$.0400/Dth
Total =$.7663/Dth
1 1 1
WGCP = [(((1-WR1)(1-WR2)(1-WR3))+0.03)(WSG)] + WGT
1 1
WGCP
= [(((1-.0197)(1-.0228)(1-.0200))+0.03)(S2.235)] + S.7663/Dth
WGCP = $3.213/mmBtu
EXAMPLE 3 - Start-up Fee
Winter Oil Price = ($4.45/mmBtu)(OI) = ($4.45)(.903) =$4.018/mmBtu
OI:
i) Norfolk average #2 = 52.225 cents/gal
ii) Greensboro average #2 = 51.175 cents/gal
Total = 103.400 cents/gal
0I = 103.400/114.49 = .903
Start-up Fee = $38,286($4.018-$3.213) = $30,820
EXAMPLE 4 - Over Delivery
If Fuel Supplied = 110,000 Dth on 5 Days and North Carolina
Power requests Facility to generate 11,798,000 kWh then,
CEPP = 11,798,000 kWh [$.002/kWh + .0089
mmBtu/kWH($.16/mmBtu)] +
(5 Days)($450.00/Day) = S42, 646.00
FC = (11,798,000 kWh)(8900 Btu/kWh) = 105,000 Dth
FA = (110,000 Dth)(.98) = 107,800 Dth
FA > FC by 2,800 Dth, over delivery reconciliation is:
($2.0263/Dth + transport cost + retainage factor)(2,800 Dth)
= ($2.0263/.9674 +.3568)(2,800 Dth) = $6,864.00 due Company
EXAMPLE 5 - Under Delivery
If Fuel Supplied = 100,000 Dth on 5 Days and North Carolina
Power requests Facility to generate 11,798,000 kWh then,
CEPP = 11,798,000 kWh [$.002 kWh + .0089
mmBtu/kWH($.16/mmBtu)]
+ (5 Days)($450.00/Day) = $42,646.00
FC = (11,798,000 kWh)(8900 Btu/kWh) = 105,000 Dth
FA = (100,000 Dth)(.98) = 98,000 Dth
FC > FA by 7,000 Dth, under delivery reconciliation is:
(S2.0263/Dth + transport cost + retainage factor)(7,000 Dth)
= ($2.0263/.9674 +.3568)(7,000 Dth) $17,160.00 due
Operator