Loading...
HomeMy WebLinkAbout5.217 Original ContractCITY LIGHT September 4, 1997 Mr. Mike McInnes, General Manager Clallam County PUD #1 2431 East Hwy 101 Port Angeles, WA 98362 -0207 Dear Mike: Sincerely, Steven E. Hursh Electrical Engineering Manager 5.. /'7 cpv-io ef CITY OF PORT ANG1LES 321 Ea.t Fifth Sueet. PO Bo\ 1150 Poi t An_eleti. Watihmgton 98362-1150 Subject: Amendment #1 Morse Creek Transmission Agreement Phone '3601417-4705 TTY Phone )360) 417-4645 Fay 360) 417 -4709 e -mad pahghttn o1vmptn net RR cE/V ED SEP 8 7997 No, PU In 1985 we signed an easement agreement with the previous property owner of Black Hawk Ridge Subdivision that requires the City to provide one electrical junction box on his property to allow for an electrical service connection. The connection would comply with the serving utility's rules, regulations, and policies. The serving utility is Clallam County PUD per the terms and conditions of our Electrical Service Area Ag reement. In 1988 we signed the attached Transmission Agreement to wheel power from our Morse Creek Hydro electric Project. The interconnection point between the City and the PUD is switch D4260 at the corner of Glass and Boyd Road. The electrical design for serving Black Hawk Ridge subdivision uses our underground powerline along Black Hawk Loop to provide electric service to several of the lots. To avoid a duplication of facilities and honor our easement agreement, we would like to amend Exhibit "B" in our Transmission Agreement to move the interconnection point from switch D4260 to vault MH -3. We would also transfer ownership of our underground powerline and related appurtenances between switch D4260 and vault MH -3 from the City to the PUD; including the vault and sectionalizing cabinet at MH -3. If this is agreeable to you, please sign the attached Amendment #1 and return one copy to me for our records. If you have any questions, please feel free to call me at your convenience at 417 -4702. A AMENDMENT #1 TO THE TRANSMISSION AGREEMENT FOR MORSE CREEK HYDROELECTRIC PROJECT The parties hereto mutually agree as follows: 1. Authorize the attached drawing be added to Exhibit "B" in the Transmission Agreement For Morse Creek Hydroelectric Project. 2. Authorize the transfer of electric facilities from the City of Port Angeles to Clallam County PUD #1 between switch D4260 and City Light vault MH -3; including the vault and sectionalizing cabinet at MH -3. 3. Authorize section V. d. in Exhibit "B" be replaced by the following: District isolates work area if fault is on its system possibly opening elbows in electric vault MH -3. City isolates work area if fault is on its underground cable would open elbows in electric vault MH -3. When the elbows in electric vault MH -3 is opened or closed by either party, the other will be notified. Michael Mc Clallam .&uz eneral Manager Jack P'ttis, ublic Works Director City o ort Angeles 94,427 Date cl4_ b)7 Date �!S 89'2f '49" 5.0 10 AC ShEFT2 s4 1280.104' V- 0 3 z CO ao\ Nair J-4 601 AC sfteEJ /3.010 AC. 41C\ WOO 4 5 010 AC. S.OJO aG 94W f SHEET 4 t r 0XSIING 1 pox\ 0 ao 30878#0‘A 11" PVC 9 99V GALAX me I \N_ e1 x Ewer 2" P/C. G0W11NLE TU 4.8 80 L c7 r IN,M.L. KY a' SCH. 90 PVC 5.094 AC.` MIA t fPW J -BOX MVO* SHUT E 766 CAME 3 z co O 1n 5.010 AC 5ff LJ 6 'C7 5 010 AC. 511ccr 6 010 A.C. !'HEFT 6 CV EU _2 p 5015 AC z SOUR /c 5.002 AC P 10 IN 1 20' rip 40 PVC IN 5pRW al— s6 29358 SW' i 05.0f0 AC Nr Con_ or SE J/4. Nw 1/4 SEC 29 S 8975'00" E ?63.664 68 r� 4260 1324.439' M 1 1 S a CENTER 1/4 COR. St 29 CITY L ILW 1149174.L 1P1.PPIC La% '7 N 89'28'07' W ON E0U5t1N4 VNL1 'y No1!i PEVELOI'ERw MMt7N ldwe Cr PAVNG 1 LID. L 6 6 N P r'1ahurr CADLe. .LNCnCSd pox a] pvi 26 C3 5.626 6 AC. O h NWY P R5r. 01 494580 25 177511 too' 294 EY15nNG a Y Lair vA Lr M N 4. NORMPI OP% 019n146 CI I f PPIMP Y CABLES ow e. d CIGNWV/41 -1 V\ \-4 3 Lv MN -4. M 1-1 Z. u 0. PRaMSAL1 tfAhg2P 2/12/ 97 CtW.#N6 a ORIGC 1) C MAGKHA lMC PiPae RCP. 4/0/ 91 mum aRDF.v if 97-0274 I sca _�ao Jw?. 30 Mnlc 05 ur 29 COhv�QC I7 3 2- 1458 0 e 2_5 AUTHENTICATED COPY Contract No. DE- MS79- 91BP93194 August 28, 1991 TRANSMISSION AGREEMENT executed by the UNITED STATES OF AMERICA DEPARTMENT OF ENERGY acting by and through the BONNEVILLE POWER ADMINISTRATION and CITY OF PORT ANGELES and CLALLAM COUNTY PUD providing services for MORSE CREEK HYDRO PROJECT Index to Sections Section Page 1. Term of Agreement 3 2. Definitions and Explanation of Terms 4 3. Exhibits 5 4. Revision of Exhibits 5 I Section Page 5. Transmission of Electric Power 7 6. Payment Provisions 8 7. Termination of Agreement and Charges 9 8. Reactive Power 10 9. Interconnection and Metering 10 10. General Environmental Provisions 11 11. Several Obligations 11 12. Execution in Counterpart 12 Exhibit A (General Transmission Rate Schedules and General Transmission Rate Schedule Provisions) 5 Exhibit B (General Wheeling Provisions [GNP Form -4R]) 5 Exhibit C (Transmission Parameters) 5 Exhibit D (Loss Factors) 5 Exhibit E (Resource Services) 5 This TRANSMISSION AGREEMENT, executed October 15 1991, by the UNITED STATES OF AMERICA (Government), Department of Energy, acting by and through the BONNEVILLE POWER ADMINISTRATION (Bonneville), the CITY OF PORT ANGELES (City), a municipality of the State of Washington, and CLALLAM COUNTY PUD (Utility), a Public Utility District of the State of Washington, 2 WI T N E S S E T H WHEREAS the Utility and the City have entered into an agreement whereby the Utility will provide firm capacity in its transmission or distribution system facilities for the transmission of electric power generated at the Morse Creek Hydroelectric Project, and for interconnection of the Project to the facilities of the Utility (Interconnection Agreement); and WHEREAS the Utility and Bonneville have agreed to provide firm capacity on their transmission or distribution facilities for the transmission of power from the Project to the City; and WHEREAS the City owns the Project and the transmission service occurs over the Utility's and Bonneville's facilities for delivery to the City; and WHEREAS the load which is served hereunder at the Point of Interconnection and the Point of Delivery is in the control area of Bonneville; and WHEREAS Bonneville is authorized pursuant to law to dispose of Electric Power generated at various Federal hydroelectric projects in the Pacific Northwest, or acquired from other resources, to construct and operate transmission facilities, to provide transmission and other services, and to enter into agreements to carry out such authority; NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Term of Agreement. This agreement shall be effective commencing at 2400 hours on the date Bonneville has signed all original counterparts of this agreement (Effective Date) and shall continue until the earlier of: (a) 2400 hours on the date of termination pursuant to section 7 below; or (b) 2400 hours on September 30, 2011; 3 All obligations incurred hereunder shall continue until satisfied. Upon expiration of this agreement pursuant to subsection (b) above, Bonneville shall offer to extend transmission services provided hereunder, of the same quality as, and on terms and conditions consistent with, those being offered at that time to other customers similarly situated for the lesser of 20 years or the remaining life of the Project. 2. Definition and Explanation of Terms. (a) "Agency" means the Federal Energy Regulatory Commission or its successor agency which has the authority to approve Bonneville's transmission rates. (b) "Electric Power" or "power" means electric peaking capacity, expressed in kilowatts, or electric energy, expressed in kilowatthours, or both. (c) "Net Project Output" means the Electric Power generated at the Project less station service, and less transmission and transformation losses from the Project to the Point of Integration. (d) "Point of Delivery" means the point of delivery, described in Exhibit C, where Electric Power is delivered to the City by Bonneville. (e) "Point of Integration" means the point described in Exhibit C where the Net Project Output will be made available by the Utility to Bonneville. (f) "Point of Interconnection" means the point where the Net Project Output will be made available by the City to the Utility. (g) "Project" means the Morse Creek Hydroelectric Project, described in Exhibit C, consisting of the site and generating units, and related transformation and transmission facilities. (h) "Transmission Demand" means the amount specified in Exhibit C, expressed in kilowatts, which is the maximum hourly amount of Electric Power 4 to be made available to Bonneville for the account of the City under this agreement at the Point of Integration. (i) "Use -of- Facilities Charge (UFT)" means the charges, if any, specified in the Transmission Parameters Exhibit, applicable between the Point of Integration and the Point of Delivery for the purpose of recovering the cost of identifiable facilities provided by Bonneville for the City's use. Such charges and their application shall be consistent with the UFT Transmission Rate Schedule contained in the Transmission Rate Schedules and General Transmission Rate Schedule Provisions Exhibit, and shall also be consistent with Bonneville's Customer Service Policy. 3. Exhibits. Unless otherwise expressly stated herein, the rights and obligations of the parties with respect to provisions hereunder shall be subject to and governed only by the written terms of this agreement, including Exhibits A through E (Exhibits) attached hereto and by this reference made a part of this agreement. The notice provisions of section 38 of the General Wheeling Provisions [GWP Form -4R], Exhibit B, require a minimum notice prior to a Rate Adjustment Date. If the rates are disapproved or conditions are placed on them by the Agency or by any judicial interpretation of legislation by a court with jurisdiction over Bonneville, Bonneville shall not be required to give the minimum notice prior to resubmitting the rates to the Agency or implementing the Agency approved rates. The headings used in this agreement are for convenient reference only and shall not affect the interpretation of this agreement. The City shall be the "Transferee" and Bonneville shall be the "Transferor" referred to in Exhibit B. 4. Revision of Exhibits. (a) The UFT rate schedule attached hereto in Exhibit A has been confirmed and approved by the Agency. The Use -of- Facility charge specified in Exhibit C 5 shall be recalculated following any rate filing according to the provisions of such amended, modified or successor rate schedules and associated provisions, and Bonneville shall prepare a new Exhibit C incorporating the revised UFT charge. The initial Integration of Resources (IR -89) rate schedule attached hereto in Exhibit A has been confirmed and approved by the Agency. If any final rate schedule which is approved by the Agency is an amendment or modification of the initial rate schedule, the applicable amended or modified rate schedule and associated general transmission rate schedule provisions shall be attached hereto and made a part of this agreement effective as of the date specified in the Agency's approval. Any rate schedule in Exhibit A shall be replaced by successor rate schedules in accordance with the provisions of section 7(i) of the Pacific Northwest Power Act and Agency rules. (b) If Bonneville determines that the charges specified in Exhibit C or any subsequent charges specified in this agreement must be changed pursuant to sections 19 or 38 of the General Wheeling Provisions [GWP Form -4RJ, Exhibit B, it shall prepare a new Exhibit C incorporating such changes. Such new Exhibit C shall be substituted for the Exhibit C then in effect and shall become effective as of the date specified therein. (c) The loss factor for wheeling small resources, as specified in Exhibit D, may be revised from time to time upon notification by the City and the Utility of system changes or Bonneville's determination that conditions at the Project or on the Utility's system have changed sufficiently to warrant recalculating the loss factor. Bonneville shall calculate the loss factor and submit to the City and the Utility by letter pursuant to Exhibit D. The loss factor shall be reviewed yearly and revised if appropriate. 6 (d) Exhibit E shall be revised, not more frequently than once during any consecutive 12 -month period to insure Bonneville is adequately compensated. Such new Exhibit E shall be substituted for the Exhibit E then in effect and shall become effective as of the date specified therein. 5. Transmission of Electric Power. (a) For each hour during the term hereof, the City shall make available or arrange to have made available to the Utility at the Point of Interconnection between the City and the Utility the Net Project Output. (b) For each hour during the term hereof, the Utility shall make available to Bonneville for the account of the City at the Point of Integration, the Net Project Output. Such hourly amounts shall not exceed the Transmission Demand. (c) For each hour during the term hereof, Bonneville shall make available to the City at the Point of Delivery for account of the City, the amount of Electric Power made available to Bonneville pursuant to subsection 5(b) above. Bonneville shall not be obligated to provide transmission services in excess of the Transmission Demand. (d) Bonneville shall add to the metered quantities monthly at the Point of Integration and subtract from the metered quantities monthly at the Point of Delivery the amount of the Net Project Output. (e) Nothing contained in the power sales contract between Bonneville and the City (Contract No. DE- MS79- 818P90450 as amended, extended or replaced) shall limit in any way the obligation of Bonneville or the City to provide the firm transmission services hereunder. (f) Nothing contained in the power sales contract between Bonneville and the Utility (Contract No. DE- MS79- 81BP90488 as amended, extended or replaced) 7 shall limit in any way the obligations of Bonneville or the Utility to provide the firm transmission services hereunder. (g) Bonneville may charge for resource services provided by Bonneville for the Project pursuant to Exhibit E, if Exhibit E is developed. The resource services may include, but shall not be limited to operating reserves and making available amounts of Electric Power to the City, pursuant to subsection 5(c) above, which vary from the Net Project Output. 6. Payment Provisions. (a) The City shall pay Bonneville each month, in accordance with the General Transmission Rate Schedule Provisions of Exhibit A, for the services provided by Bonneville hereunder, as follows: (1) the amount determined by multiplying the UFT charge specified in Exhibit C by the billing demand as defined in the Use of Facilities Transmission rate schedule included in Exhibit A; and (2) the amount calculated pursuant to Exhibit E for resource services. Bonneville shall make appropriate billing adjustments during periods, if any, when operation of the Project is limited by governmental agencies having jurisdiction over the Project and related facilities. (b) Ratchet Demand shall be as determined by Bonneville pursuant to Exhibit A. A Ratchet Demand does not constitute an increase in the Transmission Demand approved by Bonneville. Continued service at such increased level by Bonneville shall depend on availability of facilities as determined by Bonneville. (c) The City shall pay the Utility each month for the transmission services provided by the Utility hereunder as provided in the Interconnection Agreement. Such obligation is an obligation of the City. 8 (d) To the extent that the billing determinants contained in Exhibit C include a demand factor, which may be represented by a "transmission demand," "contract demand," "measured demand" or other type of demand quantity, the billing demand and rachet provisions, if any, of the General Transmission Rate Schedule Provisions contained in Exhibit A shall apply to the calculation of payments. (e) Billing for the Transmission Demand shall begin on the effective date of the Transmission Demand, as specified in Exhibit C. 7. Termination of Agreement and Charges. This agreement may be terminated by the City (1) upon destruction or abandonment of the Project; (2) upon discontinuation of Project output under a final order of a public official having authority to issue such order; (3) upon termination of the Interconnection Agreement between the City and the Utility; or (4) upon revocation by the Agency of a license to construct and operate the Project from the Agency. This agreement may not be terminated by reason of a partial reduction in generating capability. Unless otherwise mutually agreed, the City shall provide Bonneville and the other parties hereto, 60 days prior written notice of a termination date pursuant to this section 7. If this agreement is terminated earlier than the term described in section 1(b) above, or if there is a partial reduction in generating capability, the City shall pay Bonneville as follows: (a) monthly at a rate that shall compensate Bonneville for the annual cost of the facilities so constructed, to the extent such facilities become unusable in whole or in part as the result of such destruction or abandonment of the Project or upon such partial permanent reduction or discontinuation of Project output; or 9 (b) as mutually agreed for the unamortized unsalvageable investment plus the cost of removal of any facilities Bonneville has constructed at Government expense for the purpose of providing transmission service for the Project hereunder. 8. Reactive Power. It is the intent of the parties hereto that the voltage level at the Points of Interconnection, Points of Integration and the Points of Delivery be controlled in accordance with prudent utility operating practice. The parties hereto shall plan jointly and operate their systems so as not to place an undue burden on the other party to supply or absorb reactive power accompanying or resulting from deliveries hereunder. 9. Interconnection and Metering. (a) Before Electric Power shall be made available to the City, all equipment and facilities needed for safe and reliable interconnection to Bonneville's facilities shall be installed and in operation as approved by Bonneville. The cost of interconnection to Bonneville's facilities shall be at the City's expense unless all parties agree otherwise. If at any time during the term of this agreement, Project generation creates disturbances on or otherwise degrades the integrity of the Federal Columbia River Transmission System (FCRTS), Bonneville may interrupt transmission services. The City, at City's expense, shall take the necessary action to correct such problems prior to such services being resumed. (b) Bonneville shall require use of a Revenue Metering System (RMS) unit or like unit meeting Bonneville's specifications to meter output from the Project. Bonneville shall perform all operation and maintenance (O&M) services on the RMS unit. Likewise, the City shall use Jem meters or equivalent to determine output from the Project; and the City shall perform 1 0 all O &M service on its meter. The cost associated with the purchase and maintenance of the RMS unit including repair or replacement shall be at the City's expense. The original purchase of the RMS unit is provided under Agreement No. DE- AI79- 87BP72149. Installation of telecommunications equipment for both Bonneville and City's metering equipment and all service charges shall be at the City's expense. Ownership of the RMS equipment shall remain with the Government. 10. General Environmental Provisions. (a) The City shall comply with all terms and conditions of any permit, license, law, regulation, or other approval lawfully required for or applicable to the construction, operation, maintenance, repair, decommissioning, or site restoration of the Project. This includes, but is not limited to, all mitigation plans and environmental agreements which were developed during the National Environmental Policy Act review, or other processes. (b) If an order of a Federal, State, or Local agency or Indian tribe with jurisdiction or a final decision of a court of competent jurisdiction finds that the City is in noncompliance with subsection 10(a) above, then Bonneville may restrict transmission service otherwise to be provided pursuant to this contract until the City provides Bonneville with evidence of compliance, or progress towards compliance satisfactory to Bonneville. 11. Several Obligations. Except where specifically stated in this agreement to be otherwise, the duties, obligations, and liabilities of the parties are intended to be several and not joint or collective. Nothing contained in this agreement creates an association, trust, partnership, or 11 joint venture or to impose a trust or partnership duty, obligation, or liability on or with regard to any party. Each party shall be individually and severally liable for its own obligation under this agreement. 12. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in several counterparts. CITY OF PORT ANGELES By v Title ,DIEEC7OR Date /02/9/ /s/ ROBERT J. TITUS CLALLAM COUNTY PUD By Title Date (5040j) AUTHENTICATED COPY 12 UNITED STATES OF AMERICA Department of Energy Bonneville Power Administration By ATTEST: By Title By Title Date l' ssistant Administrator for Power Sales 1 40±0A, n O�� Date 1t2- 4 /s/ BECKY J. UPTON Director City Clerk October 2, 1991 October 2, 1991 CLALLAM COUNTY PUD Date October 15, 1991 (5 AUTHENTICATED COPY joint venture or to impose a trust or partnership duty, obligation, or liability on or with regard to any party. Each party shall be individually and severally liable for its own obligation under this agreement. 12. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in several counterparts. /s/ WALTER E. POLLOCK By CITY OF PORT ANGELES ATTEST: By By Title Title Date Date By 1 --e=e t.-/ 0 _,e) t- c-.t.r- By /s/ WILLIAM McCRORIE /s/ LARRY HAAS 12 UNITED STATES OF AMERICA Department of Energy Bonneville Power Administration Assistant Administrator for Power Sales President, Secretar Title Board of Commissioners Title Board of ommissioners Date October 15, 1991 EDIT B GWP Form -4R (04- 15 -83) GENERAL WHEELING PROVISIONS Index to Sections Section Page GENERAL APPLICATION 1. Interpretation 2 2. Definitions 2 3. Prior Demands 4 4. Measurements 4 5. Measurements and Installation of Meters 5 6. Tests of Metering Installations 5 7. Adjustment for Inaccurate Metering 5 8. Character of Service 6 9. Point(s) of Delivery and Delivery Voltage 6 10. Combining Deliveries Coincidentally 6 11. Suspension of Deliveries 6 12. 'Continuity of Service 6 13. Uncontrollable Forces 7 14. Reducing Charges for Interruptions 7 15. Net Billing 7 16. Average Power Factor' 7 17. Permits 8 18. Ownership of Facilities 8 19. Adjustment for Change of Conditions 8 20. Dispute Resolution and Arbitration 9 21. Contract Work Hours and Safety Standards 10 22. Convict Labor 11 23. Equal Employment Opportunity 11 24. Additional Provisions 12 25. Reports 12 26. Assignment of Contract 12 27. Waiver of Default 13 28. Notices and Computation of Time 13 29. Interest of Member of Congress 13 APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancing Phase Demands 13 31. Adjustment for Unbalanced Phase Demands 13 32. Changes in Requirements or Characteristics 13 33. Inspection of Facilities 13 34. Electric Disturbances 14 35. Harmonic Control 15 APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor 15 RELATING ONLY TO RURAL ELECTRIFICATION BORROWERS 37. Approval of Contract 15 APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates 15 for such purpose. Bonneville, in determining the Measured Demand, will exclude any abnormal Integrated Demands due to, or resulting from (a) emergencies or breakdowns on, or maintenance of, either parties' facilities, and (b) emergencies on facilities of the Transferee, provided that such facilities have been adequately maintained and prudently operated as determined by Bonneville. If the contract provides for delivery of more than one class of power to a Transferee at any Point of Delivery, the portion of each Integrated Demand assigned to any class of power shall be determined as specified in the contract. The portion of the Integrated Demand so assigned shall constitute the Measured Demand for such class of power. (e) "Month" means the period commencing at the time when the meters mentioned in this contract are read by Bonneville and ending approximately 30 days thereafter when a subsequent reading of such meters is made by Bonneville (f) "Point(s) of Delivery" means the point(s) of delivery listed either in the Points of Delivery Exhibit to this contract or in the body of this contract. (g) "System" or "Facilities" means the transmission facilities: (1) which are owned or controlled by either party, or (2) which either party may use under lease, easement, or license. (h) "Transferee" means an entity which receives power or energy from the system of the Transferor. (i) 'Transferor" means an entity which receives at one point on its system a supplying entity's power or energy and makes such power or energy available at another point on its system for the account of the delivering entity or a third party. (j) "Uncontrollable Forces' means: (1) strikes or work stoppage affecting the operation of the Contractor's works, system, or other physical facilities or of the Federal System Facilities or the physical facilities of any Transferee upon which such operation is completely dependent; the term "strikes or work stoppage' shall be deemed to include threats of imminent strikes or work stoppage which reasonably require a party or Transferee to restrict or terminate its operations to prevent substantial loss.or damage to its works, system, or other physical facilities; or (2) such of the following events as the Contractor or Bonneville or any Transferee by exercise of reasonable diligence and foresight, could not reasonably have been expected to avoid: (A) events, reasonably beyond the control of either party or any Transferee, causing failure, damage, or destruction of any works system or facilities of such party or Transferee; the word "failure° automatically recorded by such meter or, at the request of either party, the measurement as mutually determined by the best available information. If it is provided in this contract that measurements made by any of the meters specified therein are to be adjusted for losses, such adjustments shall be made by using factors, or by compensating the meters, as agreed upon by the parties hereto. If changes in conditions occur which substantially affect any such loss factor or compensation, it will be changed in a manner which will conform to such change in conditions. 5. Measurements and Installation of Meters. Bonneville may at any time install a meter or metering equipment to make the measurements for any Point of Delivery required for any computation or determination mentioned in this contract, and if so installed, such measurements shall be used thereafter in such computation or determination. 6. Tests of Metering Installations. Each party to this contract shall, at its expense, test its metering installations associated with this contract at least once every two years, and, if requested to do so by the other party, shall make additional tests or inspections of such installations, the expense of which shall be paid by such other party unless such additional tests or inspections show the measurements of such installations to be inaccurate as specified in section 7. Each party shall give reasonable notice of the time when any such test or inspection is to be made to the other -party who may have representatives present at such test or inspection. Any component of such installations found to be defective or inaccurate shall be adjusted, repaired or replaced to provide accurate metering.. 7. Adjustment for Inaccurate Metering (a) If any meter mentioned in this contract fails to register, or if the measurement made by such meter during a test made as provided in section 6 varies by more than one percent from the measurement made by the standard meter used in such test, or if an error in meter reading occurs, adjustment shall be made correcting all measurements for the actual period during which such innacurate measurements were made, if such period can be determined. If such period cannot be determined, the adjustment shall be made for the period immediately preceding the test of such meter which is equal to the lesser of (a) one -half the time from the date of the last preceding test of such meter, or (b) six months. Such corrected measurements shall be used to recompute the amounts of any electric power and energy to be made available, or any credits to be made in any exchange energy account, and of any money compensation to be paid to the Transferor as provided in this contract. (b) If the credit theretofore made to the Transferor in the exchange energy account varies from the credit to be made as recomputed, the amount of the variance will be credited in such exchange energy account to the party entitled thereto. (c) If the money compensation theretofore paid to the Transferor varies from the money compensation to be paid as recomputed, the amount of the variance will be paid to the party entitled thereto after both parties have agreed to such recomputation and within 30 days after receipt of invoice by the designated payment office of the payer; provided, however, that the other 13. Uncontrollable Forces. Each party shall notify the other as soon as possible or any uncontroiiaDie Forces which may in any way affect the delivery of power hereunder. In the event the operations of either party are interrupted or curtailed due to such Uncontrollable Forces, such party shall exercise due diligence to reinstate such operations with reasonable dispatch. 14. Reducing Charges for Interruptions. If deliveries of electric power and energy to the Transferee are suspended, interrupted, interfered with or curtailed due to Uncontrollable Forces on either the Transferee's System or Transferor's System, or if the Transferor interrupts or reduces deliveries to the Transferee for any of the reasons stated in section 12 hereof, the credit in the exchange energy account which would otherwise be made, or the money compensation which would otherwise be paid to the Transferor, shall be appropriately reduced. No interruption, or equivalent interruption, of less than 30 minutes duration will be considered for computation of such reduction in charges. 15. Net Billing. Upon mutual agreement of the parties, payment due one party may be offset against payments due the other party under all contracts between the parties hereto for the sale and exchange of electric power and energy, use of transmission facilities, operation and maintenance of electric facilities, lease of electric facilities, mutual supply of emergency and standby electric power and energy, and under such Other contracts between such parties as the parties may agree, unless otherwise provided in existing contracts between the parties. Under contracts included in this procedure, all payments due one party in any month shall be offset against payments due the other party in such month, and the resulting net balance shall be paid to the party in whose favor such balance-exists unless the latter elects to have such balance carried forward to be added to the payments due it in a succeeding month. 16. Average Power Factor. (a) The formula for determining average power factor is as follows: Average Power Factor Kilowatthours /(Kilowatthours)' (Reactive Kilovolt- ampere- hours) The data used in the above formula shall be obtained from meters which are ratcheted to prevent reverse registration. (b) When delivery of electric power and energy by the Transferor at any pointis commingled with any other class or classes of power and it is impracticable to separately meter the kilowatthours and reactive kilovolt -ampere-hours for each class, the average power factor of the total delivery of such electric power and eners9 for the month will be used, where applicable, as the power factor for each of the separate classes. (c) Except as it is otherwise specifically provided in this contract, no adjustment will be made for power factor at any point of delivery described in this contract while the varhours delivered at such point are not measured. equipment or facilities for that purpose shall be deemed to be a change of conditions within the meaning of the preceding sentence. If, pursuant to the terms of the agreement establishing such exchange energy account, another rate is substituted for the rate to be used in settling the balance in such account, the number of kilowatthours to be credited to the Transferor in such account for each month as provided in this agreement, shall be changed for each month thereafter to the amount computed by multiplying such number of kilowatthours by 2.5 mills and dividing the resulting product by the currently effective substituted rate in mills per kilowatthour. 20. Dispute Resolution and Arbitration. (a) Pending resolution of a disputed matter the parties will continue performance of their respective obligations pursuant to this contract. If the parties cannot reach timely mutual agreement on any matter in the administration of this contract Bonneville shall, unless otherwise specifically provided for in subsection (b) below and, to the extent necessary for its continued performance, make a determination of such matter without prejudice to the rights of the other party. Such determination shall not constitute a waiver of any other remedy belonging to the Contractor. (b) The questions of-fact stated below shall be subject to arbitration. Other questions of fact under this contract may be submitted to arbitration upon written mutual agreement of the parties. The party calling for arbitration shall serve notice in writing upon the other party, setting forth in detail the question or questions to be arbitrated and the arbitrator appointed by such party. The other party shall, within 10 days after the receipt of such notice, appoint a second arbitrator, and the two so appointed shall choose and appoint a third. In case such other party fails to appoint an arbitrator within said 10 days, or in case the two so appointed fail for 10 days to agree upon and appoint a third, the party calling for the arbitration, upon 5 days' written notice delivered to the other party, shall apply to the person who at the time shall be the presiding judge of the United States Court of Appeals for the Ninth Circuit for appointment of the second and third arbitrator, as the case may be. The determination of the question or questions submitted for arbitration shall be made by a majority of the arbitrators and shall be binding on the parties. Each party shall pay for the services and expenses of the arbitrator appointed by or for it, for its own attorney fees, and for compensation for its witnesses or consultants. All other costs incurred in connection with the arbitration shall be shared equally by the parties thereto. The questions of fact to be determined as provided in this section shall be limited to: (1) the determination of the measurements to be made by the parties hereto pursuant to section 4; (2) the correction of the measurements to be made pursuant to section 7; c (d) Subcontracts. The Contractor shall insert in any subcontracts the clauses set rortn in subsections (a) through (c) of this provision and also a clause requiring the subcontractors to include theseciauses in any lower tier subcontracts which they may enter into, together with a clause requiring this insertion in any further subcontracts that may in turn be made. (e) Records. The Contractor shall maintain payroll records containing the information specified in 29 CFR 516.2(a). Such records shall be preserved for 3 years from the completion the contract. 22. Convict Labor. In connection with the performance of work under this contract, the Contractor agrees, if and to the extent required by applicable law or if not otherwise exempted, not to employ any person undergoing sentence of imprisonment except as provided by Public Law 89 -176, September 10, 1965 (18 U.S.C. 4082(c)(2)) and Executive Order 11755, December 1973. 23. Equal Employment Opportunity. During the performance of this contract, if and to the extent required by applicable law or if not otherwise exempted, the Contractor agrees as follows: (a) The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by Bonneville setting forth the provisions of the Equal Opportunity clause. (b) The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin. (c) The Contractor will send to each labor union or representative of workers with which said Contractor has a collective bargaining agreement or other contract or understanding, a notice, to be provided by Bonneville, advising the labor union or worker's representative of the Contractor's commitments under this Equal Opportunity clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment. (d) The Contractor will comply with all provisions of Executive Order No. 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. (e) The Contractor will furnish ail information and reports required by Executive Order No. 11246.of September 24, 1965,'and by the rules, regulations, and relevant orders of the Secretary of Labor, or pursuant 11 to specifically provided in this section. The consent of Bonneville is hereby given to any security assignment or other like financing instrument which may be required under terms of any mortgage, trust, security agreement or holder. of such instrument of indebtedness made by and between the Contractor and any mortgagee, trustee, secured party, subsidiary of the Contractor or holder of such instrument of indebtedness, as security for bonds of other indebtedness of such Contractor, present or future; such mortagagee, trustee, secured party, subsidiary, or holder may realize upon such security in foreclosure or other suitable proceedings, and succeed to all right, title, and interests of such Contractor. 27. Waiver of Default. Any waiver at any time by any party to this contract of its rights with respect to any default of any other party thereto, or with respect to any other matter arising in connection with such contract, shall not be considered a waiver with respect to any subsequent default or matter. 28. Notices and Computation of Time. Any notice required by this contract to be given to any party shall be effective when it is received by such party, and in computing any period of time from such notice, such period shall commence at 2400 hours on the date of receipt of such notice. 29. Interest of Member of Congress. Congress, or Resident Commissioner shall this contract or to any benefit that may shall not be construed to extend to this for its general benefit. No Member of, or Delegate to be admitted to any share or part of arise therefrom, but this provision contract if made with a- corporation APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancin4 Phase Demands. If required by the Transferor at any time during the term of this contract, the Transferee shall promptly make such changes as are necessary on its system to balance the phase currents at any Point of Delivery so that the current of any one phase shall not exceed the current on any-other phase at such point by more than 10 percent. 31. Adjustment for Unbalanced Phase Demands. If the Transferee fails to promptly make the changes mentioned to section JU, the Transferor may, after giving written notice one month in advance, determine that the Measured Demand of the Transferee at the Point of Delivery in question during each month thereafter, until such changes are made, is equal to the product obtained by multiplying by three the largest of the Integrated Demands on any phase adjusted as appropriate to such point during such month. 32. Changes in Requirements or Characteristics. The Transferee will, whenever possible, give reasonable notice to the transferor of any unusual increase or decrease of its demands for electric power and energy on the Transferor's system, or of any unusual change in the load factor or cower factor at which the Transferee will take delivery of electric power and energy under this contract. 33. Inspection of Facilities. Each party may for any reasonable purpose under this contract inspect the other party's electric installation at any reasonable time. Such inspection, or failure to inspect, shall not render (f) Nothing in this section shall be construed to create any duty to, any standard of care with reference to, or any liability to any person not a party to this contract. 35. Harmonic Control. Each party shall design, construct, operate, maintain and use its electric facilities in accordance with good engineering practices to reduce to acceptable levels the harmonic currents and voltages which pass into the other party's facilities. Harmonic reductions shall be accomplished with equipment which is specifically designed and permanently operated and maintained as an integral part.of the facilities of the party which owns the system on which harmonics are generated. APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor. Protection is or will be afforded to Bonneville or its Transferor under such of the following provisions and conditions as are specified in each contract executed or to be executed by Bonneville and each third party Transferee named in this contract: the power factor clause of the applicable Bonneville Wholesale Rate Schedule and the subject matter set forth in the General Contract Provisions under the following titles, namely: Adjustment for Unbalanced Phase Demands; Uncontrollable Forces; Continuity of Service; Changes in Demands or Characteristics; Electric Disturbances; Harmonic Control; Balancing Phase Demands; Permits; Ownership of Facilities; and Inspection of Facilities. RELATING TO RURAL ELECTRIFICATION ADMINISTRATION BORROWERS 37. Approval of Contract. If the Contractor borrows from the Rural Electrification Administration or any other entity under an indenture which requires the lender's approval of contracts, this contract and any amendment thereto shall not be binding on the parties thereto if they are 'not approved by the Rural Electrification Administration or such other entity. The Contractor shall notify Bonneville of any such entity. If approval is given, such contract or amendment shall be effective at the time stated therein. APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates. (a) Bonneville shall establish, periodically review and revise rates for the wheeling of electric power and /or energy pursuant to the terms of this contract. Such rates shall be established in accordance with applicable law. (b) As used in this section, the words 'Rate Adjustment Date" shall mean any date specified by Bonneville in a notice of intent to file revised rates as published in the Federal Register; rovided, however, that such date shall not occur sooner than (1) nine months from the date that such notice of intent is published; or (2) twelve months from any previous Rate Adjustment Date. By giving written notice to the Contractor 45 days prior to such Rate Adjustment Date, Bonneville may delay such Rate Adjustment Date for up to 90 days if Bonneville determines either that the revenue level of the proposed rates A. Points of Integration, Points of Delivery, Transmission Demand, Charges, and Resources. Point of Integration (Voltage) (P0I) Government's Port Angeles Substation 69 kV Bay 26 Point of Delivery (POD) (Voltage) Government's Port Angeles Substation 69 kV Bay 23 (5040j) Transmission Demand 485 KW Transmission Parameters Use -of- Facilities Charge (UFT) 1/ Composite UFT charge based on Bays 23 26. Exhibit C, Page 1 of 4 Contract No. DE- MS79- 918P93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement Resource to be Integrated $0.097 /kW /mo Morse Creek 1/ B. Calculation of Charges Pursuant to the UFT -83 Rate Schedule: Facility Investment Government's $160,631 Port Angeles Substation 69kV Bay 26 Bay 23 $257,740 (5040j) Total UFT Charge 2/ I &A I &A Annual Annual Cost Ratio Cost 8.73 $14,023 $6,533 28,185 kW 0.729 8.73 Exhibit C, Page 2 of 4 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement 1/ 0 &M Annual Cost $22,501 $6,533 3/, 4/ Sum of Non Coincidental Demands 66,219 kW 5/ /kW /yr. 0.438 485 kW $1.168 /kW yr $0.097 /kW /mo 6/ Project Demand 485 kW 1/ 0 &M charge based on low voltage terminal in 2 -4 -91 0 &M cost tables. 2/ Normally taken from current ACR table, column (8) minus column (5), Type S5 Substation, revised table dated 5 -3 -91. 3/ 1992 peak loads from Clailam Eastern (27,700 kW) plus Morse Creek (485 kW). 4/ 1992 peak loads from Port Angeles' City No. 1 bay (60.18 of Port Angeles' City Nos. 1 and 2) plus Morse Creek (485 kW) plus Clallam's Eastern bay (27,700 kW). (60.18% X 63,200) 485 27,700 66,219 kW. 5/ Unit Charge (I&A Annual Cost) 0 &M Annual Cost /kW yr. Sum of Non Coincidental Demands Monthly Charge /kW yr) (Project Demand) /mo. 12 months 6/ Ratchets shall be handled in accordance with section 5(c). 1. MORSE CREEK HYDRO PROJECT Demand: 485 kW; Voltage: 12.5 kV; Exhibit C, Page 3 of 4 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement B. Description of Project and Points of Integration and Points of Delivery Location: the project is located in the NW 1/4 of Section 29, T30N, RSW, Willamette Meridian, Clallam County, Washington; approximately 3 miles east of Port Angeles and 1 -1/2 to 2 miles south of state route 101 and primarily east of Glass Road; Metering: in the City's powerhouse, in the 480 volt circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for transformation losses between the Project point of metering and the high side of the Project transformer. 2. MORSE CREEK POINT OF INTERCONNECTION Location: A point on the Utility's distribution line approximately one half mile from the Morse Creek Hydro Project at the junction of Glass and Boyd Roads where the distribution lines of the Utility and the line from the City's Project interconnect; Voltage: 12.5 kV; Adjustments: there shall be an adjustment for transmission losses between the Morse Creek Hydro Project and the Morse Creek Point of Interconnection. 3. PORT ANGELES POINT OF INTEGRATION Location: the point in Bay 26 (Clallam Co. PUD's Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the Utility and the Government are connected; Voltages: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for distribution losses between the Utility's Morse Creek Point of Interconnection and the Government's Port Angeles Point of Interconnection. 0 4. PORT ANGELES POINT OF DELIVERY (5040j) Voltages: 69 kV; Exhibit C, Page 4 of 4 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement Location: the point in Bay 23 (Port Angeles Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the City and the Government are connected; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be no adjustment for losses between the Point of Interconnection and the Point of Delivery. (5040j) Loss Factors Exhibit D, Page 1 of 1 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement The losses specified in this exhibit under Points of Interconnection and Points of Delivery shall consist of two components. The first is the transformation and transmission losses from the Project to the Morse Creek Point of Interconnection, and the second is the transmission and transformation losses from the Morse Creek Point of Interconnection to the Port Angeles Point of Integration. No losses shall be applied between the Port Angeles Point of Integration and the Port Angeles Point of Delivery as specified in this exhibit. The losses between the Project Point of Metering and the Port Angeles Point of Integration shall be submitted to the City and the Utility by Bonneville by separate letter. The revision of these losses shall be as specified in section 4(c). (5040j) Resource Services Exhibit E, Page 1 of 1 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement Resource service charges shall be incorporated into Exhibit E as developed by Bonneville according to section 4(d) of this agreement. As of the Effective Date of this Agreement, the resource service charge is zero. 1991 Transmission Rate Schedules anc Genera Transmission Rate Sciec u e Provisions Bonneville E 0)1) It A 5,211 POWER ADMINISTRATION October 1991 United States Department of Energy Bonneville Power Administration 905 NE 11th Avenue Portland, Oregon 97232 Bonneville Power Administration's 1991 Transmission Rate Schedules and General Transmis- sion Rate Schedule Provisions were approved on an interim basis by the Federal Energy Regulatory commission, United States Department of Energy, in a commission order issued September 13, 1991 (Docket Nos. EF91 -201 1 -000, et al.). These rate schedules and provisions supersede the Administration's Transmission Rate Schedules and General Transmission Rate Schedule Provisons effective October 1, 1989. TRANSMISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS General Transmission Rate Schedule Provisions TABLE OF CONTENTS Current Transmission Rate Schedules Page FPT -91.1 Formula Power Transmission 1 FPT -91:3 Formula Power Transmission 2 IR -91 Integration of Resources 3 IS -91 Southern Interne Transmission 4 IN -91 Northern Interne Transmission 5 IE -91 Eastern Intertie Transmission 6 ET -91 Energy Transmission 7 MT -91 Market Transmission 8 UFT -83 Use -of- Facilities Transmission 9 TGT -1 Townsend- Garrison Transmission 10 Section I Adoption of Revised Transmission Rate Schedules and General Transmission Rate Schedule Provisions 12 Section 11 Billing Factor Definitions and Billing Adjustments 12 Section III Other Definitions 13 Section IV Billing Information 14 SECTION 1. AVAILABILITY This schedule supersedes schedule FPT -89.1 for all firm transmission agreements which provide that rates may be adjusted not more frequently than once a year It is available for firm transmission of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This schedule is for full-year and partial -year service and for either continuous or intermittent service when firm availability of service is required. For facilities at voltages lower than the Secondary System, a different rate schedule may be speci- fied. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions (GTRSPs) SECTION II. RATE A. Full -Year Service The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the Main Grid Charge and the Secondary System Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component factors as specified in the Agreement. a. Main Grid Distance Factor: The amount com- puted by multiplying the Main Grid Distance by $0.0281 per mile; b. Main Grid Interconnection Terminal Factor. $0 27; c Main Grid Terminal Factor: $0.30, d Main Grid Miscellaneous Facilities Factor: $1.31; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following component factors as speci- fied in the Agreement: a. Secondary System Distance Factor. The amount determined by multiplying the Secondary System Distance by $0.1961 per mile; b. Secondary System Transformation Factor $2.53; c. Secondary System Intermediate Terminal Factor $0 84; d Secondary System Interconnection Terminal Fac- tor. $0.44, Schedule FPT -91.1 Formula Power Transmission 1 B. Partial -Year Service The monthly charge per kilowatt of billing demand shall be as specified in Section II.A for all months of the year except for agreements with terms 5 years or less and which specify service for fewer than 12 months per year The monthly charge shall be: 1. During months for which service is specified, the monthly charge defined in Section II.A, and 2. During other months, the monthly charge defined in Section II. A multiplied by 0.2 SECTION III. BILLING FACTORS Unless otherwise stated in the Agreement, the billing de- mand shall be the largest of: A. The Transmission Demand; B. The highest hourly Scheduled Demand for the month, or C. The Ratchet Demand. SECTION 1. AVAILABILITY This schedule supersedes schedule FPT -89 3 for all firm transmission agreements which provide that rates may be adjusted not more frequently than once every 3 years. It is available for firm transmission of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This schedule is for full-year and partial -year service and for either continuous or intermittent service when firm avail- ability of service is required. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this schedule is subject to BPA's GTRSPs. SECTION 11. RATE A. Full-Year Service The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the Main Grid Charge and the Secondary System Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component factors as specified in the Agreement: a. Main Grid Distance Factor• The amount com- puted by multiplying the Main Grid Distance by $0 0281 per mile; b. Main Grid Interconnection Terminal Factor: $0.27; c. Main Grid Terminal Factor: $0.30; d. Main Grid Miscellaneous Facilities Factor: $1 31; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following component factors as speci- fied in the Agreement: a. Secondary System Distance Factor The amount determined by multiplying the Secondary System Distance by $0.1961 per mile; b. Secondary System Transformation Factor. $2.53, c. Secondary System Intermediate Terminal Factor. 0.84; d. Secondary System Interconnection Terminal Factor: $0.44; Schedule FPT -91.3 Formula Power Transmission 2 B. Partial -Year Service The monthly charge per kilowatt of billing demand shall be as specified in Section II A for all months of the year except for agreements with terms 5 years or less and which specify service for fewer than 12 months per year. The charge shall be: 1. During months for which service is specified, the monthly charge defined in Section II.A, and 2. During other months, the monthly charge defined in Section II.A multiplied by 0.2. SECTION III. BILLING FACTORS Unless otherwise stated in the Agreement, the billing demand shall be the largest of: A. The Transmission Demand; B. The highest hourly Scheduled Demand for the month; or C. The Ratchet Demand SECTION I. AVAILABILITY This schedule supersedes IR -89 and is available for firm transmission service for electric power and energy using the Main Grid and /or Secondary System of the FCRTS. The definitions of Main Grid and Secondary Systems are the same as for the FPT -91.1 and FPT -91 3 rate schedules and are contained in the GTRSPs. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this schedule is subject to BPA's GTRSPs. SECTION I1. RATE The monthly charge shall be the sum of A and B where: A. The Demand Charge shall be: 1. $0.312 per kilowatt of billing demand; or 2. For Points of Integration (P01) specified in the Agree- ment as being short distance POI's, for which Main Grid and Secondary System facilities are used for a distance of less than 75 circuit miles, the following formula applies: [0.2 (0 8/75 x transmission distance)] ($0.312 per kilowatt of billing demand) Where: the billing demand for a short distance POI is the demand level specified in the Agreement for such POI, and the transmission distance is the circuit miles between the POI for a generating resource of the customer and a designated Point of Delivery serving load of the customer. Short distance POI's are deter- mined by BPA after considering factors in addition to transmission distance. B. The Energy Charge shall be: .92 mills /kWh of billing energy. Schedule IR -91 Integration of Resources 3 SECTION I11. BILLING FACTORS To the extent that the Agreement provides for the customer to be billed for transmission in excess of the Transmission Demand or Total Transmission Demand, as defined in the Agreement, at the nonfarm transmission rate (currently ET -91), such transmission service shall not contribute to either the Billing Demand or the Billing Energy for the IR rate provided that the customer requests such treatment and BPA approves in accordance with the prescribed provisions in the Agreement. A. Billing Demand The billing demand shall be the largest of: 1. The Transmission Demand, except under General Transmission Agreements where a Total Trans- mission Demand is defined; 2. The highest hourly Scheduled Demand for the month; or 3. The Ratchet Demand. B. Billing Energy The billing energy shall be the monthly sum of sched- uled kilowatthours. t SECTION I. AVAILABILITY This schedule supersedes IS -89 and is available for all transmission on the Southern Intertie Service under this schedule is subject to BPA's GTRSPs SECTION II. RATE A. Nonfirm Rate The charge for nonfirm transmission of non -BPA power shall be 2.1 mills /kWh of billing energy. This charge applies for both north -to -south and south -to -north trans- actions B. Firm Power Transmission Rate The charge for firm transmission service granted access by BPA shall be $0.450 per kW per month of billing demand and 1.02 mills /kWh of billing energy. Firm transmission will only be made available to customers under this rate schedule who have executed a contract with BPA specifying use of the Firm Power Transmission rate for either north -to -south or south -to -north trans- actions. SECTION III. BILLING FACTORS A. For services under Section II.A, the billing energy shall be the monthly sum of the scheduled kilowatthours, plus the monthly sum of kilowatthours allocated but not scheduled. The amount of allocated but not scheduled energy that is subject to billing may be reduced pro rata by BPA due to forced Interne outages and other uncon- trollable forces that may reduce Interne capacity The amount of allocated but not scheduled energy that is subject to billing also may he reduced upon mutual agreement between BPA and the customer. B. For services under Section II.B, the billing demand shall be the Transmission Demand as defined in the Agree- ment. The billing energy shall be the monthly sum of scheduled kilowatthours, unless otherwise specified in the Agreement. Schedule IS -91 Southern Intertie Transmission 4 SECTION 1. AVAILABILITY This schedule supersedes IN -89 and is available for all transmission on the Northern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for transmission of non -BPA power on the Northern Interne shall be 0.96 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled ki lowatthours. Schedule IN -91 Northern Intertie Transmission SECTION I. AVAILABILITY This schedule supersedes IE -89 and is available for all nonfirm transmission on the Eastern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for transmission of nonfirm energy on the Eastern !ntertie shall be 2.02 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. Schedule IE -91 Eastern Intertie Transmission 6 I SECTION I. AVAILABILITY This schedule supersedes ET -89, unless otherwise specified in the Agreement, with respect to delivery using FCRTS facilities other than the Southern Intertie, Eastern Intertie, or the Northern Intertie, and is available for firm (of not more than 1 year duration) or nonfirm transmission between points within the Pacific Northwest. BPA may interrupt nonfarm service which is provided under this rate schedule. Service under this schedule is subject to BPA's GTRSPs SECTION II. RATE The charge for transmission of non -BPA electric energy shall be 1.81 mills /kWh. SECTION I11. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of scheduled ki lowatthou rs. Schedule ET -91 Energy Transmission 7 SECTION I. AVAILABILITY This schedule supersedes MT -89 and is available for Trans- mission Service for transactions using FCRTS facilities pursu- ant to the Western Systems Power Pool (WSPP) Agreement. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION I1. RATE The charge shall be determined in advance by BPA. The charge shall be based on the duration of the proposed transaction and shall not exceed the following rates. A. Hourly Rate The maximum charge shall be 6.5 mills perkilowatthour where the total hourly revenues from a given transaction during a calendar day shall not exceed the product of the Daily rate and the maximum demand scheduled during such day. B. Daily Rate The maximum charge shall be $.105 per kilowattday where the total demand charge revenues in any con- secutive 7 -day period shall not exceed the product of the Weekly rate and the highest demand experienced on any day in the 7 -day period. C. Weekly Rate The maximum charge shall be $.52 per kilowattweek. D. Monthly Rate The maximum charge shall be $2.27 per kilowattmonth. SECTION I11. BILLING FACTORS The billing factors shall be specified in advance by BPA, as to representing the Transmission Service use or reservation Schedule MT -91 Market Transmission 8 SECTION I. AVAILABILITY This schedule supersedes UFT -1 and UFT -2 unless otherwise provided in the Agreement, and is available for firm transmis- sion over specified FCRTS facilities. SECTION 1I. RATE The monthly charge per kilowatt of Transmission Demand specified in the Agreement shall be one twelfth of the annual cost of capacity of the specified facilities divided by the sum of Transmission Demands (in kilowatts) using such facilities. Such annual cost shall be determined in accordance with Section III. SECTION III. DETERMINATION OF TRANSMISSION RATE A. From time to time, but not more often than once in each Contract Year, BPA shall determine the following data for the facilities which have been constructed or other- wise acquired by BPA and which are used to transmit electric power and energy: 1. The annual cost of the specified FCRTS facilities, as determined from the capital cost of such facilities and annual cost ratios developed from the FCRPS finan- cial statement, including interest and amortization, operation and maintenance, administrative and gen- eral, and general plant costs. 2. The yearly noncoincident peak demands of all users of such facilities or other reasonable measurement of the facilities' peak use. B. The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the annual cost of the FCRTS facilities used divided by the sum of Transmission De- mands The annual cost per kilowatt of Transmission Demand for a facility constructed or otherwise acquired by BPA shall be determined in accordance with the following formula: A D Where: A The annual cost of such facility as determined in accordance with A.1. above D =The sum of the yearly noncoincident demands on the facility as determined in accordance with A.2. above Schedule UFT -83 Use -of- Facilities Transmission 9 The annual cost per kilowatt of facilities listed in the Agreement which are owned by another entity, and used by BPA for making deliveries to the transferee, shall be determined from the costs specified in the Agreement between BPA and such other entity. SECTION IV. DETERMINATION OF BILLING DEMAND Unless otherwise stated in the Agreement, the factor to be used in determining the kilowatts of billing demand shall be the largest of: A. The Transmission Demand in kilowatts specified in the Agreement; B. The highest hourly Measured or Scheduled Demand for the month, the Measured Demand being adjusted for power factor; or C. The Ratchet Demand. SECTION I. AVAILABILITY This schedule shall apply to all agreements which provide for the firm transmission of electric power and energy over transmission facilities of BPA's section of the Montana [Eastern] Interne. SECTION I1. RATE The monthly charge shall be one twelfth of the sum of the annual charges listed below, as applicable and as specified in the agreements for firm transmission. The Townsend Garrison 500 -kV lines and associated terminal, linecompen- sation, and communication facilities are a separately identi- fied portion of the Federal Transmission System. Annual revenues plus credits for government use should equal annual costs of the facilities, but in any given year there may be either a surplus or a deficit. Such surpluses or deficits for any year shall be accounted for in the computation of annual costs for succeeding years. Revenue requirements for firm transmission use will be decreased by any revenues received from nonfirm use and credits for all government use. The general methodology for determining the firm rate is to divide the revenue requirement by the total firm capacity requirements. Therefore, the higher the total capacity requirements, the lower will be the unit rate. If the government provides firm transmission service in its section of the Montana [Eastern] Interne in exchange for firm transmission service in a customer's section of the Montana Intertie, the payment by the government for such transmis- sion services provided by such customer will be made in the form of a credit in the calculation of the Interne Charge for such customer. During an estimated 1 -to 3 -year period following the commercial operation of the third generating unit at the Colstrip Thermal Generating Plant at Colstrip, Montana, the capability of the Federal Transmission System west of Garrison Substation may be different from the long- term situation. It may not be possible to complete the extension of the 500 -kV portion of the Federal Transmission System to Garrison by such commercial operation date In such event, the 500/230 kV transformer will be an essential extension of the Townsend Garrison Interne facilities, and the annual costs of such transformer will be included in the calculation of the Intertie Charge. However, starting 1 month after extension to Garrison of the 500 -kV portion of the Federal Transmission System, the annual costs of such transformer will no longer be included in the calculation of the Intertie Charge. Schedule TGT -1 Townsend Garrison Transmission 10 A. Nonfirm Transmission Charge: This charge will be filed as a separate rate schedule and revenues received thereunder will reduce the amount of revenue to be collected under the Interne Charge below B. Intertie Charge for Firm Transmission Service: (CR -EC) Interne Charge [(TAC /12 -NFR) x TCR SECTION III. DEFINITIONS A. TAC =Total Annual Costs of facilities associated with the Townsend- Garrison 500 -kV Transmission line includ- ing terminals, and prior to extension of the 500 -kV portion of the Federal Transmission System to Garrison, the 500/230 kV transformer at Garrison Such annual costs are the total of (1) interest and amortization of associated Federal investment and the appropriate allo- cation of general plant costs, (2) operation and mainte- nance costs; (3) allowance for BPA's general administra- tive costs which are appropriately allocable to such facilities, and (4) payments made pursuantto section 7(m) of Public Law 96 -501 with respect to these facilities. Total Annual Costs shall be adjusted to reflect reductions to unpaid total costs as a result of any amounts received, under agreements for firm transmission service over the Montana Interne, by the government on account of any reduction in Transmission Demand, termination or par- tial termination of any such agreement or• otherwise to compensate BPA for the unamortized investment, an- nual cost, removal, salvage, or other cost related to such facilities. B. NFR Nonfirm Revenues, which are equal to: (1) the product of the Nonfirm Transmission Charge described in II(A) above, and the total nonfirm energy transmitted over the Townsend Garrison line segment under such charge for such month; plus (2) the product of the Nonfirm Transmission Charge and the total nonfirm energy transmitted in either direction by the Govern- ment over the Townsend- Garrison line segment for such month. C. CR Capacity Requirement of a customer on the Townsend Garrison 500 -kV transmission facilities as specified in its firm transmission agreement. I D. TCR Total Capacity Requirement on the Townsend Garrison 500 -kV transmission facilities as calculated by adding: (1) the sum of all Capacity Requirements (CR) specified in transmission agreements described in section 1; and (2) the Government's firm capacity re- quirement. The Government's firm capacity require- ment shall be no less than the total of the amounts, if any, specified in firm transmission agreements for use of the Montana Intertie E. EC Exchange Credit for each customer which is the product of (1) the ratio of investment in the Townsend Broadview 500 -kV transmission line to the investment in the Townsend Garrison 500 -kV transmission line, and (2) the capacity which the Government obtains in the Townsend Broadview 500- kVtransmission linethrough exchange with such customer. If no exchange is in effect with a customer, the value of EC for such customer shall be zero 11 General Transmission Rate Schedule Provisions SECTION I. ADOPTION OF REVISED TRANS- MISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS A. Approval of Rates These rate schedules and GTRSPs shall become effective upon interim approval or upon confirmation and approval by FERC. BPA will request FERC approval effective October 1, 1991 BPA is requesting that all proposed Transmission Rate Schedules be effective for a period of 2 years, from October 1, 1991 through September 30, 1993. B. General Provisions These 1991 Transmission Rate Schedules and associ- ated GTRSPs are virtually identical to and supersede BPA's 1989 Transmission Rate Schedules and GTRSPs (which became effective October 1, 1989) but do not supersede prior rate sched- ules required by agreement to remain in force. Transmission service provided shall be subject to the following Acts, as amended. the Bonneville Project Act, the Regional Preference Act (P.L 88 -552), the Federal Columbia River Transmission System Act, and the Pa- cific Northwest Electric Power Planning and Conserva- tion Act. The meaning of terms used in the transmission rate schedules shall be as defined in agreements or provi- sions which are attached to the Agreement or as in any of the above Acts. C. Interpretation If a provision in the executed Agreement is in conflict with a provision contained herein, the former shall prevail SECTION II. BILLING FACTOR DEFINITIONS AND BILLING ADJUSTMENTS A. Billing Factors 1. Scheduled Demand The largest of hourly amounts wheeled which are scheduled by the customer during the time period specified in the rate schedules. 12 2. Metered Demand The Metered Demand in kilowatts shall be the largest of the 60- minute clock -hour integrated demands measured by meters installed at each POD during each time period specified in the applicable rate schedule. Such measurements shall be made as specified in the Agreement. BPA, in determining the Metered Demand, will exclude any abnormal read- ings due to or resulting from (a) emergencies or breakdowns on, or maintenance of, the FCRTS, or (b) emergencies on the customer's facilities, provided that such facilities have been adequately maintained and prudently operated as determined by BPA. If more than one class of power is delivered to any POD, the portion of the metered quantities assigned to any class of power shall be as agreed to by the parties The amount so assigned shall constitute the Metered Demand for such class of power. 3. Transmission Demand The demand as defined in the Agreement. 4. Total Transmission Demand The sum of the transmission demands as defined in the Agreement. 5. Ratchet Demand The maximum demand established during the previ- ous 11 billing months. Exception: If a Transmission Demand or Total Transmission Demand has been decreased pursuant to the terms of the Agreement during the previous 11 billing months, such decrease will be reflected in determining the Ratchet Demand B. Billing Adjustments Average Power Factor The adjustment for average power factor, when speci- fied in a transmission rate schedule or in the Agreement, shall be made in accordance with the average power factor section of the General Wheeling Provisions. To maintain acceptable operating conditions on the Federal system, BPA may restrict deliveries of power at any time that the average leading power factor or aver- age lagging power factor for all classes of power deliv- ered to such point or to such system is below 85 percent. SECTION I11. OTHER DEFINITIONS Definitions of the terms below shall be applied to these provisions and the Transmission Rate Schedules, unless otherwise defined in the Agreement A. Agreement An agreement between BPA and a customer to which these rate schedules and provisions may be applied. B. Decremental Cost As used in the MT rate schedule, Decremental Cost is as defined in the WSPP Agreement. C. Eastern Intertie The segment of the FCRTS for which the transmission facilities consist of the Townsend Garrison double circuit 500 kV transmission line segment including related terminals at Garrison D. Electric Power Electric peaking capacity (kW) and /or electric energy (kWh). E. FCRTS The transmission facilities of the Federal Columbia River Power System, which include all transmission facilities owned by the government and operated by BPA, and other facilities over which BPA has obtained trans- mission rights. F. Firm Transmission Service Transmission service which BPA provides for any non BPA power except for transmission service which is scheduled as nonfarm. If the firm service is provided pursuant to the Agreement, the terms of the Agreement may further define the service. G. Integrated Network The segment of the FCRTS for which the transmission facilities provide the bulk of transmission of electric power within the Pacific Northwest, excluding facilities not segmented to the network in the Wholesale Power Rate Development Study used in BPA's rate develop- ment H. Main Grid As used in the FPT and IR rate schedules, that portion of the Integrated Network with facilities rated 230 kV and higher I. Main Grid Distance As used in the FPT rate schedules, the distance in airline miles on the Main Grid between the POI and the POD, multiplied by 1.15. 13 1. Main Grid Interconnection Terminal As used in the FPT rate schedules, Main Grid terminal facilities that interconnect the FCRTS with non -BPA facilities. K. Main Grid Miscellaneous Facilities As used in the FPT rate schedules, switching, transforma- tion, and other facilities of the Main Grid not included in other components. L. Main Grid Terminal As used in the FPT rate schedules, the Main Grid terminal facilities located at the sending and /or receiving end of a line exclusive of the Interconnection terminals. M. Nonfirm Transmission Service Interruptible transmission service which BPA may pro- vide for non -BPA power. N. Northern Intertie The segment of the FCRTS for which the transmission facilities consist of two 500 kV lines between Custer Substation and the United States Canadian border, one 500 kV line between Custer and Monroe Substations, and two 230 kV lines from Boundary Substation to the United States Canadian border, and the associated sub- station facilities. O. Point of Integration (P01) Connection points between the FCRTS and non -BPA facilities where non Federal power is made available to BPA for wheeling. P. Point of Delivery (POD) Connection points between the FCRTS and non -BPA facilities where non Federal power is delivered to a customer by BPA. Secondary System As used in the FPT and IR rate schedules, that portion of the Integrated Network facilities with operating voltage of 115 kV or 69 kV R. Secondary System Distance As used in the FPT rate schedules, the number of circuit miles of Secondary System transmission lines between the secondary POI and the Main Grid or the secondary POD, or the Main Grid and the secondary POD. S. Secondary System Interconnection Terminal As used in the FPT rate schedules, the terminal facilities on the Secondary System that interconnect the FCRTS with non -BPA facilities. Q. T. Secondary System Intermediate Terminal As used in the FPT rate schedules, the first and final terminal facilities in the Secondary System transmission path exclusive of the Secondary System Interconnection terminals. U. Secondary Transformation As used in the FPT rate schedules, transformation from Main Grid to Secondary System facilities. V. Southern Intertie The segment of the FCRTS for which the major transmis- sion facilities consist of two 500 kV AC lines from John Day Substation to the Oregon California border, a por- tion of the 500 kV AC line from Buckley Substation to Summer Lake Substation, and one 1,000 kV DC line between the Celilo Substation and the Oregon- Nevada border, and associated substation facilities. W. Transmission Service As used in the MT rate schedule, Transmission Service is as defined in the WSPP Agreement. SECTION IV. BILLING INFORMATION A. Payment of Bills Bills for transmission service shall be rendered monthly by BPA. Failure to receive a bill shall not release the customer from liability for payment. Bills for amounts due of $50,000 or more must be paid by direct wire transfer; customers who expect that their average monthly bill will not exceed $50,000 and who expect special difficulties in meeting this requirement may request, and BPA may approve, an exemption from this requirement. Bills for amounts due BPA under $50,000 may be paid by direct wire transfer or mailed to the Bonneville Power Administration, P.O. Box 6040, Portland, Oregon 97228- 6040, or to another location as directed by BPA. The procedures to be followed in making direct wire trans- fers will be provided by the Office of Financial Manage- ment and updated as necessary. 1. Computation of Bills The transmission billing determinant is the electric power quantified by the method specified in the Agreement or Transmission Rate Schedule. Sched- uled power or metered power will be used The transmission customer shall provide necessary information to BPA for any computation required to determine the proper charges for use of the FCRTS, and shall cooperate with BPA in the exchange of additional information which may be reasonably useful for respective operations. 14 Demand and energy billings for transmission service under each applicable rate schedule shall be rounded to whole dollar amounts, by eliminating any amount which is less than 50 cents and increasing any amounts from 50 cents through 99 cents to the next higher dollar. 2. Estimated Bills At its option, BPA may elect to render an estimated bill to be followed at a subsequent billing date by a final bill. The estimated bill shall have the validity of and be subject to the same payment provisions as a final bill. 3. Billing Month For charges based on scheduled quantities, the billing month is the calendar month. For charges based on metered quantities, the billing month is defined as the interval between scheduled meter reading dates. The billing month will not exceed 31 days in any case. While it may be necessary to read meters on a day other than the scheduled meter reading date, for determination of billing demand, the billing month will cease at 2400 hours on the last scheduled meter reading date. Schedules will be predetermined. The customer must give 30 days notice to request a change to the schedule. 4. Due Date Bills shall be due by close of business on the 20th day after the date of the bill (due date). Should the 20th day be a Saturday, Sunday, or holiday (as celebrated by the customer), the due date shall be the next following business day. 5. Late Payment Bills not paid in full on or before close of business on the due date shall be subject to a penalty charge of $25. In addition, an interest charge of one twentieth percent (0.05 percent) shall be applied each day to the sum of the unpaid amount and the penalty charge. This interest charge shall be assessed on a daily basis until such time as the unpaid amount and penalty charge are paid in full Remittances received by mail will be accepted with- out assessment of the charges referred to in the preceding paragraph provided the postmark indi- cates the payment was mailed on or before the due date Whenever a power bill or a portion thereof remains unpaid subsequent to the due date and after giving 30 days' advance notice in writing, BPA may cancel the contract for service to the customer. How- ever, such cancellation shall not affect the customer's liability for any, charges accrued prior thereto under such agreement. 6. Disputed Billings In the event of a disputed billing, full payment shall be rendered to BPA and the disputed amount noted. Disputed amounts are subject to the late payment provisions specified above. BPA shall separately account for the disputed amount. If it is determined that the customer is entitled to the disputed amount, BPA shall refund the disputed amount with interest, as determined by BPA's Office of Financial Manage- ment. BPA retains the right to verify, in a manner satisfactory to the Administrator, all data submitted to BPA for use in the calculation of BPA's rates and corresponding rate adjustments. BPA also retains the right to deny eligibility for any BPA rate or corresponding rate adjustment until all submitted data have been ac- cepted by BPA as complete, accurate, and appropri- ate for the rate or adjustment under consideration. 7. Revised Bills As necessary, BPA may render a revised bill. a. I f the amount of the revised b i l l is less than or equal to the amount of the original bill, the revised bill shall replace all previous bills issued by BPA that pertain to the specified customer for the specified billing period and the revised bill shall have the same date as the replaced bill. b. If a revision causes an additional amount to be due BPA or the specified customer beyond the amount of the original bill, a revised bill will be issued for the difference and the date of the revised bill shall be its date of issue. 15 16 5, EXHIBIT GWP Fora -4R (04- 15 -83) GENERAL WHEELING PROVISIONS Index to Sections Section Page GENERAL APPLICATION 1. Interpretation 2 2. Definitions 2 3. Prior Demands 4 4. Measurements 4 5. Measurements and Installation of Meters 5 6. Tests of Metering Installations 5 7. Adjustment for Inaccurate Metering 5 8. Character of Service 6 9. Point(s) of Delivery and Delivery Voltage 6 10. Combining Deliveries Coincidentally 6 11. Suspension of Deliveries 6 12. 'Continuity of Service 13. Uncontrollable Forces 7 14. Reducing Charges for Interruptions 7 15. Net Billing 7 16. Average Power Factor' 7 17. Permits 8 18. Ownership of Facilities 8 19. Adjustment for Change of Conditions 8 20. Dispute Resolution and Arbitration 9 21. Contract Work Hours and Safety Standards 10 22. Convict Labor 11 23. Equal Employment Opportunity 11 24. Additional Provisions 12 25. Reports 12 26. Assignment of Contract 12 27. Waiver of Default 13 28. Notices and Computation of Time 13 29. Interest of Member of Congress 13 APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancing Phase Demands 13 31. Adjustment for Unbalanced Phase Demands 13 32. Changes in Requirements or Characteristics 13 33. Inspection of Facilities 13 34. Electric Disturbances 14 35. Harmonic Control 15 APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor 15 RELATING ONLY TO RURAL ELECTRIFICATION BORROWERS 37. Approval of Contract 15 APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates 15 1. Interpretation. GENERAL APPLICATION (a) The provisions in this exhibit shall be deemed to be a part of the contract body to which they are an exhibit. If a provision in such contract body is in conflict with. a provision contained herein, the former shall prevail. (b) If a provision in the General Transmission Rate Schedule Provisions is in conflict with a provision in this exhibit or the contract body, this exhibit or the contract body shall prevail. (c) Nothing contained in this contract shall, in any manner, be construed to abridge, limit, or deprive any party thereto of any means of enforcing any remedy, either at law or in equity, for the breach of any of the provisions thereof whicn it would otherwise have. 2. Definitions. As used in this contract: (a) 'Contractor,' "Utility" or "Borrower" deans the party to this contract other than Bonneville. (b•) 'Federal System" or "Federal System Facilities" means the facilities of the Federal Columbia River Power System, which for the purposes of this contract shall be deemed to include the generating facilities of the Government in the Pacific Northwest for which Bonneville is designated as marketing agent; the facilities of the Government under the Jurisdiction of Bonneville; and any other facilities: (1) from which Bonneville receives all or a portion of the generating capability (other than station service) for use in meeting Bonneville's loads, such facilities being included only to the extent Bonneville has the right to receive such capability; provided, however, that Bonneville's loads" shall not include that portion of the loads of any Bonneville customer which are served by a nonfederal generating resource purchased or owned directly by such customer which may be scheduled by Bonneville; (2) which Bonneville may use under contract, or license; or (3) to the extent of the rights acquired by Bonneville pursuant to the Treaty, between the Government and Canada, relating to the cooperative development of water resources of the Columbia River Basin, signed in Washington, D.C., on January 17, 1961. (c) 'Integrated Demand" means the number of kilowatts which is equal to the number of kilowatt -hours delivered at any point during a clock hour. •(d) "Measured Demand' means the maximum Integrated Demand for a billing month determined from measurements made as specified in the contract or as determined in section 4 hereof when metering or other data are not available for such purpose. Bonneville, in determining the Measured Demand, will exclude any abnormal Integrated Demands due to, or resulting from (a) emergencies or breakdowns on, or maintenance of, either parties' facilities, and (b) emergencies on facilities of the Transferee, provided that such facilities have been adequately maintained and prudently operated as determined by Bonneville. If the contract provides for delivery of more than one class of power to a Transferee at any Point of Delivery, the portion of each Integrated Demand assigned to any class of power shall be determined as specified in the contract. The portion of the Integrated Demand so assigned shall constitute the Measured Demand for such class of power. (e) "Month" means the period commencing at the time when the meters mentioned in this contract are read by Bonneville and ending approximately 30 days thereafter when a subsequent reading of such meters is made by Bonneville. (f) "Point(s) of Delivery" means the point(s) of delivery listed either in the Points of Delivery Exhibit to this contract or in the body of this contract. (g) "System" or "Facilities" means the transmission facilities: (1) which are owned or controlled by either party, or (2) which either party may use under lease, easement, or license. (h) 'Transferee" means an entity which receives power or energy from the system of the Transferor. (i) 'Transferor' means an entity which receives at one point on its system a supplying entity's power or energy and makes such power or energy available at another point on its. system for the account of the delivering entity or a third party. (j) 'Uncontrollable Forces' means: (1) strikes or work stoppage affecting the operation of the Contractor's works, system, or other physical facilities or of the Federal System Facilities or the physical facilities of any Transferee upon which such operation is completely dependent; the term 'strikes or work stoppage' shall be deemed to include threats of imminent strikes or work stoppage which reasonably require a party or Transferee to restrict or terminate its operations to prevent substantial loss.or damage to its works, system, or other physical facilities; or (2) such of the following events as the Contractor or Bonneville or any Transferee by exercise of reasonable diligence and foresight, could not reasonably have been expected to avoid: (A) events, reasonably beyond the control of either party or any Transferee, causing failure, damage, or destruction of any works, system or facilities of such party or Transferee; the word "failure" 3. Prior Demands. shall be deemed to include interruption of, or interference with, the actual operation of such works, system, or facilities; (B) floods or other conditions caused by nature which limit or prevent the operation of, or which constitute an imminent threat of damage to, any such works, system, or facilities; and (C) orders and temporary or permanent injunctions which prevent operation, in whole or in part, of the works, system, or facilities of either party or any Transferee, and which are issued in any bona fide proceeding by: i. any duly constituted court of general jurisdiction; or ti. any administrative agency or officer, other than Bonneville or its officers, provided by law (a) ff said party or Transferee has no right to a review of the validity of such order by a court of competent jurisdiction; or (b) if such order Is operative and effective unless suspended, set aside, or annulled by a court of competent jusidiction and such order is not suspended, set aside, or annulled in a judicial proceeding prosecuted by said party or Transferee in good faith; provided, however, that if such order is suspended, set aside, or annuiied in sucn a judicial proceeding, it shall be deemed to be an 'uncontrollable force" for the period during which it is in effect; provided, further, that said party or Transferee, shall not be required to prosecute such a proceeding, in order to have the benefits of this section, if the parties agree that there is no valid basis for contesting the order. The term 'operation" as used in this subsection shall be deemed to include construction, if construction is required to implement the contract and is specified therein. (a) In determining any credit demand mentioned in, or money compensation to be paid under this contract for any month, Integrated Demands at which electric energy was delivered by the Transferor at Points of Delivery mentioned herein for the account of the other party to this contract prior to the date upon which the contract takes effect shall be considered in the same manner as if this contract had been in effect. (b) If either party has delivered electric power and energy to the other party at any Point of Delivery specified iii this contract or in any previous contract, and such Point of Delivery is superseded by another Point of Delivery specified in this contract, the Measured Demands, if any, at the superseded Point of Delivery shall be considered for the purpose of determining. the charges paid to the Transferor for the electric power and energy delivered under this contract at such superseded point. 4. Measurements. Except as it is otherwise provided in section 7, each measurement or each meter mentioned in this contract shall be the measurement automatically recorded by such meter or, at the request of either party, the measurement as mutually determined by the best available information. If it is provided in this contract that measurements made by any of the meters specified therein are to be adjusted for losses, such adjustments shall be made by using factors, or by compensating the meters, as agreed upon by the parties hereto. If changes in conditions occur which substantially affect any such loss factor or compensation, it will be changed in a manner which will conform to such change in conditions. S. Measurements and Installation of Meters. Bonneville may at any time install a meter or metering equipment to make the measurements for any Point of Delivery required for any computation or determination mentioned in this contract, and if so installed, such measurements shall be used thereafter in such computation or determination. 6. Tests of Metering Installations. Each party to this contract shall, at its expense, test its metering installations associated-with this contract at least once every two years, and, if requested to do so by the other party, shall make additional tests or inspections of such installations, the expense of which shall be paid by such other party unless such additional tests or inspections show the measurements of such installations to be inaccurate as specified in section 7. Each party shall give reasonable notice of the time when any such test or inspection is to be made to the other party who may have representatives present at such test or inspection. Any component of such installations found to be defective or inaccurate shall be adjusted, repaired or replaced to provide accurate metering.. 7. Adjustment for Inaccurate Metering (a) If any meter mentioned in this contract fails to register, or if the measurement made by such meter during a test made as provided in section 6 varies by more than one percent from the measurement made by the standard meter used in such test, or if an error in meter reading occurs, adjustment shall be made correcting all measurements for the actual period during which such innacurate measurements were made, if such period can be determined. If such period cannot be determined, the adjustment shall be made for the period immediately preceding the test of such meter which is equal to the lesser of (a) one —half the time from the date of the last preceding test of such meter, or (b) six months. Such corrected measurements shall be used to recompute the amounts of any electric power and energy to be made available, or any credits to be made in any exchange energy account, and of any money compensation to be paid to the Transferor as provided in this contract. (b) If the credit theretofore made to the Transferor in the exchange energy account varies from the credit to be made as recomputed, the amount of the variance will be credited in such exchange energy account to the party entitled thereto. (c) If the money compensation theretofore paid to the Transferor varies from the money compensation to be paid as recomputed, the amount of the variance will be paid to the party entitled thereto after both parties have agreed to such recomputation and within 30 days after receipt of invoice by the designated payment office of the payer; provided, however, that the other party may deduct such amount due it from any money compensation which thereafter becomes due the Transferor under this contract. 8. Character of Service. Unless otherwise specifically provided for in the contract, electric power and energy made available pursuant to this contract shall be in the form of three -phase current, alternating at a nominal frequency of 60 hertz. 9. Point(s) of Delivery and Delivery Voltage. Electric power and energy shall be delivered to each Transferee at such point or points and at such voltage or voltages as are agreed upon by the parties hereto. 10. Combining Deliveries Coincidentally. If it is provided in this contract that charges tor electric power and energy made available at two or more Points of Delivery will be made by combining deliveries at such points coincidentally: (a) the total Measured Demand to be considered in determining the billing demand for each billing month shall be the largest sum obtained by adding for each demand interval of such month the corresponding Integrated Demands of the Transferee at all such points after adjusting said Integrated Demands as appropriate to such points; (b) the number of kilowathours to be used in the energy charge, if any, and the average power factor at which electric energy is delivered at such points under this contract, during such month, shall be the sum of the amounts of electric energy delivered. at such points under this contract during such month; and (c) the number of reactive kilovolt- ampere -hours to be used in determining such average monthly power factor shall be the sum of the reactive kilovolt- ampere -hours delivered at such points under this contract such month. 11. Suspension of Deliveries. The other party to this contract may at any time notify the Transferor in writing to suspend the deliveries of electric power and energy provided for in this contract. Upon receipt of any such notice, the Transferor will forthwith discontinue, and will not resume, such deliveries until notified to do so by the other party, and upon receipt of such notice from the other party to do so, will forthwith resume such deliveries. 12. Continuity of Service. Either party may temporarily interrupt or reduce deliveries of electric power and energy if such party determines that such interruption or reduction is necessary or desirable in case of system emergencies, Uncontrollable Forces, or in order to install equipment in, make repairs to, make replacements within, make investigations and inspections of, or perform other maintenance work on its system. Except in case of emergency and in order that each party's operations will not be unreasonably interfered with, such party shall give notice to the other party of any interruption or reduction, the reason therefor, and the probable duration thereof to the extent such party has knowledge thereof. Each party shall effect the use of temporary facilities or equipment to minimize the effect of any such interruption or outage to the extent reasonable or appropriate. 13. Uncontrollable Forces. Each party shall notify the other as soon as possible or any uncontroiiacie Forces which may in any way affect the delivery of power hereunder. In the'event the operations of either party are interrupted or curtailed due to such Uncontrollable Forces, such party shall exercise due diligence to reinstate such operations with reasonable dispatch. 14. Reducing Charges for Interruptions. If deliveries of electric power and energy to the Transferee are suspended, interrupted, interfered with or curtailed due to Uncontrollable Forces on either the Transferee's System or Transferor's System, or if the Transferor interrupts or reduces deliveries to the Transferee for any of the reasons stated in section 12 hereof, the credit in the exchange energy account which would otherwise be made, or the money compensation which would otherwise be paid to the Transferor, shall be appropriately reduced. No interruption, or equivalent interruption, of less than 30 minutes duration will be considered for computation of such reduction in charges. 15. Net Billing. Upon mutual agreement of the parties, payment due one party may be offset against payments due the other party under all contracts between the parties hereto for the sale and exchange of electric power and energy, use of transmission facilities, operation and maintenance of electric facilities, lease of electric facilities, mutual supply of emergency and standby electric power and energy, and under such other contracts between such parties as the parties may agree, unless otherwise provided in existing contracts between the parties. Under contracts included'in this procedure, all payments due one party in any month shall be offset against payments due the other party in such month, and the resulting net balance shall be paid to the party in whose favor such balance-exists unless the latter elects to have such balance carried forward to be added to the payments due it in a succeeding month. 16. Average Power Factor. (a) The formula for determining average power factor is as follows: Average Power Factor Kilowatthours /(Kilowatthours)' (Reactive Kilovolt- ampere hours)' The data used in the above formula shall be obtained from meters which are ratcheted to prevent reverse registration. (b) When delivery of electric power and energy by the Transferor at any point is commingled with any other class or classes of power and it is impracticable to separately meter the kilowatthours and reactive kilovolt -ampere-hours for each class, the average power factor of the total delivery of such electric power and energy for the month will be used, where applicable, as the power factor for each of the separate classes. (c) Except as it is otherwise specifically provided in this contract, no adjustment will be made for power-factor at any point of delivery described in this contract while the varhours delivered at such point are not measured. (d) The Transferor may, but shall not be obligated to, deliver electric energy hereunder at a power factor of less than 0.85 leading or lagging. 17. Permits. (a) If any equipment or facilities associated with any Point of Delivery and belonging to a party to this contract are or are to be located on the property of the other party, a permit to install, test, maintain, inspect, replace, repair, and operate during the term of this contract and to remove such equipment and facilities at the expiration of said term, together with the right of entry to said property at all reasonable times in such term, is hereby granted by the other party. (b) Each party shall have the right at all reasonable times to enter the property of the other party for the purpose of reading any and all meters mentioned in this contract which are installed on such property. (c) If either party is required.a r permitted to install, test, maintain, inspect, replace, repair, remove, or operate equipment on the property of the other, the owner of such property shall furnish the other party with accurate drawings and wiring diagrams of associated equipment and facilities, or, if such drawings or diagrams are not available, shall furnish accurate information regarding such equipment or facilities. The owner of such property shall notify the other party of any subsequent modification which may affect the duties of the other party in regard to such equipment, and furnish the other party with accurate revised drawings, if possible. 18. Ownership of Facilities. (a) Except as otherwise expressly provided, ownership of any and all equipment, and of all salvable facilities installed or previously installed by a party to this contract on the property of the other party shall be and remain in the installing party. (b) Each party shall identify all movable equipment and all other salvable facilities which are installed by such party on the property of the other by permanently affixing thereto suitable markers plainly stating the name of the owner of the equipment and facilities so identified. Within a reasonable time subsequent to initial installation, and subsequent to any modification of such installation, representatives of the parties shall jointly prepare an i temi Zed list of said movable equipment and facilities. 19. Adjustment for Change of Conditions. If changes in conditions hereafter occur which substantially affect any factor required by this contract to be used in determining (a) any credit in any exchange energy account to be made, money compensation to be paid, or amount of electric power and energy or losses to be made available .to one party by the other party, or (b) any maximum replacement demand, or average power factor mentioned in this contract, such factor will be changed in an equitable manner which will conform to such changes of *conditions. If an increase in the capacity of the facilities being used by the Transferor in making deliveries hereunder is required at any time after execution of this contract to enable the Transferor to make the deliveries herein required together with those required for its own operations, the construction or installation of additional or other 8 equipment or facilities for that purpose shall be deemed to be a change of conditions within the meaning of the preceding sentence. If, pursuant to the terms of the agreement establishing such exchange energy account, another rate is substituted for the rate to be used in settling the balance in such account, the number of kilowatthours to be credited to the Transferor in such account for each month as provided in this agreement, shall be changed for each month thereafter to the amount computed by multiplying such number of kilowatthours by 2.5 mills and dividing the resulting product by the currently effective substituted rate in mills per kilowatthour. 20. Dispute Resolution and Arbitration. (a) Pending resolution of a disputed matter the parties will continue performance of their respective obligations pursuant to this contract. If the parties cannot reach timely mutual agreement on any matter in the administration of this contract Bonneville shall, unless otherwise specifically provided for in subsection (b) below and, to the extent necessary for its continued performance, make a determination of such matter without prejudice to the rights of the other party. Such determination shall not constitute a waiver of any other remedy belonging to the Contractor. (b) The questions of-fact stated below shall be subject to arbitration. Other questions of fact under this contract may be submitted to arbitration upon written mutual agreement of the parties. The party calling for arbitration shall serve notice in writing upon the other party, setting forth in detail the question or questions to be arbitrated and the arbitrator appointed by such party. The other party shall, within 10 days after the receipt of such notice, appoint a second arbitrator, and the two so appointed shall choose and appoint a third. In case such other party fails to appoint an arbitrator within said 10 days, or in case the two so appointed fail for 10 days to agree upon and appoint a third, the party calling for the arbitration, upon 5 days' written notice delivered to the other party, shall apply to the person who at the time shall be the presiding judge of the United States Court of Appeals for the Ninth Circuit for appointment of the second and third arbitrator, as the case may be. The determination of the question or questions submitted for arbitration shall be made by a majority of the arbitrators and shall be binding on the parties. Each party shall pay for the services and expenses of the arbitrator appointed by or for it, for its own attorney fees, and for compensation for its witnesses or consultants. All other costs incurred in connection with the arbitration shall be shared equally by the parties thereto. The questions of fact to be determined as provided in this section shall be limited to: (1) the determination cf the measurements to be made by the parties hereto pursuant to section 4; (2) the correction of the measurements•to be made pur to section 7; (3) the duration of the interruption or equivalent interruption in section 14; (4) whether changes in conditions mentioned in section 19 have Occurred; (5) whether the changes mentioned in section 30 were made "promptly (6) whether an increase or decrease in load or change in load factor mentioned in section 32 is unusual; (7) any issue which both parties agree is an issue of fact mentioned in sections 30, 31, and 34; (8) the occurrence of an abnormal nonrecurring demand and the amount and time thereof; (9) whether a party has complied with section 34(b); and (10) the acceptable level of harmonics for purposes of section 35. 21. Contract Work Hours and Safety Standards. This contract,.if and to the extent required by applicable law and if not otherwise exempted, is subject to the following provisions: (a) Overtime Requirements. No Contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics, shall require or permit any laborer or mechanic in any workweek in which such worker is employed on such work to work in excess of 8 hours in any calendar day or in excess of 40 hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one —half times such worker's basic rate of pay for all hours worked in excess of eight hours in any calendar day or in excess of 40 hours in such workweek, as the case may be. (b) Violation; Liability for Unpaid Wages; Liquidated Damages. In the event of any violation of the provisions of subsection (a), the Contractor and any subcontractor responsible therefor shall be liable to any affected employee for such employee's unpaid wages. In addition, such contractor and subcontractor shall be liable to the Government for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic employed in violation of the provisions of subsection (a) in the sum of S10 for each calendar day on which such employee was required or permitted to be employed in such work in excess of eight hours or in excess of such employee's standard workweek of 40 hours without payment of the overtime wages required by subsection (a) above. (c) Withholding for Unpaid Wages and Liquidated Damages. Bonneville may withhold or cause to be withnela, from any moneys payable on account of work performed by the Contractor or subcontractor, such sums as may administratively be determined to be necessary to satisfy any liabilities of such Contractor or subcontractor for unpaid wages and liquidated damages as provided in subsection (b) above. (d) Subcontracts. The Contractor shall insert in any subcontracts the clauses set ror n in subsections (a) through (c) of this provision and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts which they may enter into, together with a clause requiring this insertion in any further subcontracts that may in turn be made. (e) Records. The Contractor shall maintain payroll records containing the information specified In 29 CFR 516.2(a). Such records shall be preserved for 3 years from the completion of the contract. 22. Convict Labor. In connection with the performance of work under this contract, the Contractor agrees, if and to the extent required by applicable law or if not otherwise exempted, not to employ any person undergoing sentence of imprisonment except as provided by Public Law 89 -176, September 10, 1965 (18 U.S.C. 4082(c)(2)) and Executive Order 17756, December 29, 1973. 23. Equal Employment Opportunity. During the performance of this contract, if and to the extent required by applicable law or if n-t otherwise exempted, the Contractor agrees as follows: (a) The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by Bonneville setting forth the provisions of the Equal Opportunity clause. (b) The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin. (c) The Contractor will send to each labor union or representative of workers with which said Contractor has a collective bargaining agreement or other contract or understanding, a notice, to be provided by Bonneville, advising the labor union or worker's representative of the Contractor's commitments under this Equal Opportunity clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment. (d) The Contractor will comply with a71 provisions of Executive Order No. 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. (e) The Contractor will furnish all information and reports required by Executive Order No. 11246 of September 24, 1965,4nd by the rules, regulations, and relevant orders of the Secretary of Labor, or pursuant 11 f4 thereto, and will permit access to said Contractor's books, records, and accounts by Bonneville and the Secretary of Labor for purposes of investigations to ascertain compliance with such rules, regulations, and orders. (f) In the event of the Contractor's noncompliance with the Equal Opportunity clause of this contract or with any of such rules, regulations, or orders, this contract may be cancelled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order No. 11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order No. 1124E of September 24, 1963, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law. (g) The Contractor will include the provisions of paragraphs (a) through (f) in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order No. 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as Bonneville may direct as a means of enforcing such provisions, including sanctions for noncompliance. In the event the Contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by Bonneville, the Contractor may request the Government to enter into such litigation to protect the interests of the Government. 24. Additional Provisions. The Contractor agrees to comply with the clauses tor government contracts contained in the following statutes, Executive Orders, and regulations to the extent applicable: (a) the Rehabilitation Act of 1973, Public Law 93 -112, as amended, and 41 CFR 60 -741 (affirmative action for handicapped workers); (b) the Vietnam Era Veterans Readjustment Assistance Act of 1974, Public Law 92 -540, as amended, and 41 CFR 60 -250 (affirmative action for disabled veterans and veterans of the Vietnam era); (c) Executive Order 11625 and 41 CFR 1- 1.1310 -2 (utilization of minority business enterprises); (d) the Small Business Act, as amended. 25. Reports. The other party to this contract will furnish Bonneville such information as is necessary for making any computation required for the purposes of this contract, and the parties will cooperate in exchanging such additional information as may be reasonably useful for their respective operations. 26. Assignment of Contract. This contract shall inure to the benefit of, and shall oe olnaing upon the respective successors and assigns of the parties to this contract." Such contract or any interest therein shall not be transferred or assigned by either party to any party other than the Government or an agency thereof without the written consent of the other except as specifically provided in this section. The consent of Bonneville is hereby given to any security assignment or other like financing instrument which may be required under terms of any mortgage, trust, security agreement or holder. of such instrument of indebtedness made by and between the Contractor and any mortgagee, trustee, secured party, subsidiary of the Contractor or holder of such instrument of indebtedness, as security fof bonds of other indebtedness of such Contractor, present or future; such mortagagee, trustee, secured party, subsidiary, or holder may realize upon such security in foreclosure or other suitable proceedings, and succeed to all right, title, and interests of such Contractor. 27. Waiver of Default. Any waiver at any time by any party to this contract of its rights with respect to any default of any other party thereto, or with respect to any other matter arising in connection with such contract, shall not be considered a waiver with respect to any subsequent default or matter. 28. Notices and Computation of Time. Any notice required by this contract to be given to any party shall be effective when it is received by such party, and in computing any period of time from such notice, such period shall commence at 2400 hours on the date of receipt of such notice. No Member of, or Delegate to be admitted to any share or part of arise therefrom, but this provision contract if made with a- corporation 29. Interest of Member of Congress. Congress, or Resident Com tssioner shall this contract or to any benefit that may shall not be construed to extend to this for its general benefit. APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancin4 Phase Demands. If required by the Transferor at any time during the term of this contract, the Transferee shall promptly make such changes as are necessary on its system to balance the phase currents at any Point of Delivery so that the current of any one phase shall not exceed the current on any other phase at such point by more than 10 percent. 31. Adjustment for Unbalanced Phase Demands. If the Transferee fails to promptly make tne changes mentioned to section .s0, the Transferor may, after giving written notice one month in advance, determine that the Measured Demand of the Transferee at the Point of Delivery in question during each month thereafter, until such changes are made, is equal to the product obtained by multiplying by three the largest of the Integrated Demands on any phase adjusted as appropriate to such point during such month. 32. Changes in Requirements or Characteristics. The Transferee will, whenever possible, give reasonable notice to tne transferor of any unusual increase or decrease of its demands for electric power and energy on the Transferor's system, or of any unusual change in the load factor or-oower factor at which the Transferee will take delivery of electric power and energy under this contract. 33. Inspection of Facilities. Each party may for any reasonable purpose under this contract inspect the other party's electric installation at any reasonable time. Such inspection, or failure to inspect, shall not render such party, its officers, agents, or employees, liable or responsible for any injury, loss, damage, or accident resulting from defects in such electric installation, or for violation of this contract. The inspecting party shall observe written instructions and rules posted in facilities and such other necessary instructions or standards for inspection as the parties agree to. Only those electric installations used in complying with the terms of this contract shall be subject to inspection. 34. Electric Disturbances. (a) For the purposes of this section, an electric disturbance is any sudden, unexpected, changed, or abnormal electric condition occurring in or on an electric system which causes damage. (b) Each party shall design, construct, operate, maintain and use its electric system in conformance with accepted utility practices: (1) to minimize electric disturbances such as, but lot limited to, the abnormal flow of power which may damage or interfere with the electric system of the other party or any electric system connected with such other party's electric system; and (2) to minimize the effect on its electric system and on its customers of electric disturbances originating on its own or another electric system. (c) If both parties to this contract are parties to the Western Interconnected Electric System Agreement, their relationship with respect to system damages shall be governed by that Agreement. (d) During such time as a party to this contract is not a party to the Agreement Limiting Liability Among Western Interconnected Systems, its relations with the other party with respect to system damages shall be governed by the following sentence, notwithstanding the fact that the other party may be a party to said Agreement Limiting Liability Among Western Interconnected Systems. A party to this contract shall not be liable to the other party for damage to the other party's system or facilities caused by an electric disturbance on the first party's system, whether or not such electric disturbance is the result of negligence by the first party, if the other party has failed to fulfill its obligations under subsection (b)(2) above. (e) If one of the parties to this contract is not a party to the Agreement Limiting Liability Among Western Interconnected Systems, each party to this contract shall hold harmless and indemnify the other party, its officers and employees, from any claims for loss, injury, or damage suffered by those to whom the first party delivers power not for resale, which loss, injury or damage is caused by an electric disturbance on the other party's system, whether or not such electric disturbance results from the negligence of such other party if such first party has failed to fulfill its obligations under subsection (b)(2) above, and such failure contributed to the loss, injury or damage. (f) Nothing in this section shall be construed to create any duty to, any standard of care with reference to, or any liability to any person not a party to this contract. 35. Harmonic Control. Each party shall design, construct, operate, maintain and use its electric facilities in accordance with good engineering practices to reduce to acceptable levels the harmonic currents and voltages which pass into the other party's facilities. Harmonic reductions shall be accomplished with equipment which is specifically designed and permanently operated and maintained as an integral part of the facilities of the party which owns the system on which harmonics are generated.• APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor. Protection is or will be afforded to Bonneville or its Transferor under such of the following provisions and conditions as are specified in each contract executed or to be executed by Bonneville and each third party Transferee named in this contract: the power factor clause of the applicable Bonneville Wholesale Rate Schedule and the subject matter set forth in the General Contract Provisions under the following titles, namely: Adjustment for Unbalanced Phase Demands; Uncontrollable Forces; Continuity of Service; Changes in Demands or Characteristics; Electric Disturbances; Harmonic Control; Balancing Phase Demands; Permits; Ownership of Facilities; and Inspection of Facilities. RELATING TO RURAL ELECTRIFICATION ADMINISTRATION BORROWERS 37. Approval of Contract. If the Contractor borrows from the Rural Electrification Administration or any other entity under an indenture which requires the lender's approval of contracts, this contract and any amendment thereto shall not be binding on the parties thereto if they are -not approved by the Rural Electrification Administration or such other entity. The Contractor shall notify Bonneville of any such entity. If approval is given, such contract or amendment shall be effective at the time stated therein. APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates. (a) Bonneville shall establish, periodically review and revise rates for the wheeling of electric power and /or energy pursuant to the terms of this contract. Such rates shall be established in accordance with applicable law. (b) As used in this section, the words 'Rate Adjustment Date" shall mean any date specified by Bonneville in a notice of intent to file revised rates as published in the Federal Register; rovided, however, that such date shall not occur sooner than (1) nine months from tnedate tnat such notice of intent is published; or (2) twelve months from any previous Rate Adjustment Date. By giving written notice to the Contractor 45 days prior to such Rate Adjustment Date, Bonneville may delay such Rate Adjustment Date for up to 90 days if Bonneville determines either that the revenue level of the proposed rates differs by more than five percent from the revenue requirements indicated by most recent repayment studies entered in the hearings record or that external events beyond Bonneville's control will prevent Bonneville from meeting such Rate Adjustment Date. Bonneville may cancel a notice of intent to file revised rates at any time (1) by written notice to the Contractor; or (2) by publishing in the Federal Register a new notice of intent to file revised rates which specifically cancels a previous notice. (c) The Contractor shall pay Bonneville for the service made available under this contract during the period commencing on each Rate Adjustment Date and ending at the beginning of the next Rate Adjustment Date at the rate specified in any rate schedule available at the beginning of such period for service of the class, quality, and type provided for in this contract, and in accordance with the terms thereof, and of the General Transmission Rate Schedule Provisions, if any, as changed with, incorporated in or referred to in such rate schedule. New rates shall not be effective on any Rate Adjustment Date unless they have been approved on a final or interim basis by a governmental agency designated by law to approve Bonneville's rates. Rates shall be applied in accordance with the terms thereof, the General Transmission Rate Schedule Provisions as changed with, incorporated in or referred to in such rate schedule and the terms of this contract. (WP- PKJ- 0222f) 16 A. Points of Integration, Points of Delivery, Transmission Demand, Charges, and Resources. Point of Integration (Voltage) (POI) Government's Port Angeles Substation 69 kV Bay 26 Point of Delivery (POD) (Voltage) Government's Port Angeles Substation 69 kV Bay 23 1/ Composite UFT charge based on Bays 23 26. (5040j) Transmission Demand 485 KW Transmission Parameters Exhibit C, Page 1 of 4 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement Use -of- Resource Facilities to be Charge (UFT) Integrated $0.097 /kW /mo Morse Creek 1/ Exhibit C, Page 2 of 4 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement B. Calculation of Charges Pursuant to the UFT -83 Rate Schedule: Facility Investment Government's $160,631 Port Angeles Substation 69kV Bay 26 Bay 23 $257,740 (5040j) Total UFT Charge 2/ I &A Annual Cost Ratio 1/ 3/, 4/ I &A 0 &M Sum of Annual Annual Non Coincidental 5/ Cost Cost Demands /kW /yr. 8.73 $14,023 $6,533 28,185 kW 0.729 8.73 $22,501 $6,533 66,219 kW 0.438 485 kW $1.168 /kW yr $0.097 /kW /mo 6/ Project Demand 485 kW 1/ 0 &M charge based on low voltage terminal in 2 -4 -91 0 &M cost tables. 2/ Normally taken from current ACR table, column (8) minus column (5), Type S5 Substation, revised table dated 5 -3 -91. 3/ 1992 peak loads from Clallam Eastern (27,700 kW) plus Morse Creek (485 kW). 4/ 1992 peak loads from Port Angeles' City No. 1 bay (60.18 of Port Angeles' City Nos. 1 and 2) plus Morse Creek (485 kW) plus Clallam's Eastern bay (27,700 kW). (60.18% X 63,200) 485 27,700 66,219 kW. 5/ Unit Charge (I &A Annual Cost) 0 &M Annual Cost /kW yr. Sum of Non Coincidental Demands Monthly Charge /kW yr) (Project Demand) /mo. 12 months 6/ Ratchets shall be handled in accordance with section 5(c). Exhibit C, Page 3 of 4 Contract No. DE- MS79- 918P93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement B. Description of Proiect and Points of Integration and Points of Delivery 1. MORSE CREEK HYDRO PROJECT Location: the project is located in the NW 1/4 of Section 29, T30N, R5W, Willamette Meridian, Clallam County, Washington; approximately 3 miles east of Port Angeles and 1 -1/2 to 2 miles south of state route 101 and primarily east of Glass Road; Demand: 485 kW; Voltage: 12.5 kV; Metering: in the City's powerhouse, in the 480 volt circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for transformation losses between the Project point of metering and the high side of the Project transformer. 2. MORSE CREEK POINT OF INTERCONNECTION Location: A point on the Utility's distribution line approximately one half mile from the Morse Creek Hydro Project at the junction of Glass and Boyd Roads where the distribution lines of the Utility and the line from the City's Project interconnect; Voltage: 12.5 kV; Adjustments: there shall be an adjustment for transmission losses between the Morse Creek Hydro Project and the Morse Creek Point of Interconnection. 3. PORT ANGELES POINT OF INTEGRATION Location: the point in Bay 26 (Clallam Co. PUD's Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the Utility and the Government are connected; Voltages: 69 kV; Metering:_ in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for distribution losses between the Utility's Morse Creek Point of Interconnection and the Government's Port Angeles Point of Interconnection. 4. PORT ANGELES POINT OF DELIVERY (5040j) Location: the point in Bay 23 (Port Angeles Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the City and the Government are connected; Voltages: 69 kV; Exhibit C, Page 4 of 4 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be no adjustment for losses between the Point of Interconnection and the Point of Delivery. (5040j) Loss Factors Exhibit D, Page 1 of 1 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement The losses specified in this exhibit under Points of Interconnection and Points of Delivery shall consist of two components. The first is the transformation and transmission losses from the Project to the Morse Creek Point of Interconnection, and the second is the transmission and transformation losses from the Morse Creek Point of Interconnection to the Port Angeles Point of Integration. No losses shall be applied between the Port Angeles Point of Integration and the Port Angeles Point of Delivery as specified in this exhibit. The losses between the Project Point of Metering and the Port Angeles Point of Integration shall be submitted to the City and the Utility by Bonneville by separate letter. The revision of these losses shall be as specified in section 4(c). (5040j) Resource Services Exhibit E, Page 1 of 1 Contract No. DE- MS79- 91BP93194 Morse Creek Hydroelectric Project Effective at 2400 hours on the Effective Date of this Agreement Resource service charges shall be incorporated into Exhibit E as developed by Bonneville according to section 4(d) of this agreement. As of the Effective Date of this Agreement, the resource service charge is zero. In reply refer to Mr. Robert J. Titus Director City Of Port Angeles P.O. Box 1150 Port Angeles, WA 98362 Dear Mr. Titus: Department of Energy Bonneville Power Administration P.O. Box 3621 Portland, Oregon 97208 -3621 SEP 1 0 1990 5.217 PMT Contract No. DE- MS79- 90BP93051 The City of Port Angeles (City) and Bonneville Power Administration (Bonneville) have executed two short term letter agreements for firm wheeling services effective from 2400 hours June 30, 1988 to September 30, 1990. In the first agreement, the parties acknowledged that nonfirm wheeling services for the Morse Creek Project (Project) were provided from October 20, 1987 through June 30, 1988. It was the parties' desire to operate under this type of arrangement pending resolution of Articles 19 -25 of the FERC license. It is apparent that FERC is planning to grant compliance on the last of the outstanding articles, Article 23, in the near future. However due to the uncertainty associated with the timing of FERC actually granting compliance with Article 23, Bonneville proposes that firm wheeling services be continued as follows: 1. Term. This letter agreement shall be effective at 2400 hours on September 30, 1990 and shall terminate at 2400 hours on the earlier of (a) the effective date of the Long -Term Agreement, Contract No. DE- MS79- 88BP92315, (Attachment A) or (b) 2400 hours on September 30, 1991; provided, however, that all liabilities incurred hereunder shall be preserved until satisfied. 2. Exhibit. Attachment A is hereby made a part of this agreement; provided, however, that Section 1 of Attachment A shall have no force and effect during the term of this agreement. 3. Operation Under Attachment A. The parties shall operate pursuant to the terms of Attachment A except as otherwise provided. The parties recognize Clallam'County PUD (Utility) owns the interconnection facilities between the Project and the Government's Port Angeles Substation. Bonneville shall not be obligated to comply with Attachment A if the Utility fails to perform its obligations as designated in Attachment A. Celebrating the U.S. Constitution Bicentennial 1787 -1987 If the terms of this agreement are satisfactory, please indicate your acceptance by signing both enclosed copies and returning one copy to George Reich at the Puget Sound Area Office. Authenticated copies will then be sent to you for your records. (4373j) Enclosures Sincerely, Walter E. Pollock Assistant Administrator for Power Sales ACCEPTED: CITY OF PORT ANGELES ATTEST: By �6 --d\ 0o..n, By apinA. U v Tit(e Mayor Title City Clerk Date October 2, 1990 Date October 2. 1990 TRANSMISSION AGREEMENT executed by the UNITED STATES OF AMERICA DEPARTMENT OF ENERGY acting by and through the BONNEVILLE POWER ADMINISTRATION and CLALLAM COUNTY PUD and CITY OF PORT ANGELES MORSE CREEK HYDRO PROJECT Index to Sections Attachment A Contract No. DE- MS79- 88BP92315 08/18/88 Section Page 1. Term of Agreement 3 2. Definition and Explanation of Terms 3 3. Exhibits; Interpretations 4 4. Transmission of Electric Power and Energy 4 5. Payment Provisions 6 6. Termination of Agreement and Charges 6 7. Revision of Exhibits 7 8. Reactive Power 9 9. Metering Equipment 9 10. Several Obligations 9 11. Execution in Counterpart 10 Section Page Exhibit A (Transmission Rate Schedules and General Transmission Rate Schedule Provisions) 4 Exhibit B (General Wheeling Provisions [GWP Form -4R]) 4 Exhibit C (Transmission Parameters) 4 Exhibit D (Project, Point of Interconnection, Point of Delivery) 4 Exhibit E (Loss Factors) 4 Exhibit F (Resource Services) 4 This TRANSMISSION AGREEMENT, executed 19_, by the UNITED STATES OF AMERICA (Government), Department of Energy, acting by and through the BONNEVILLE POWER ADMINISTRATION (Bonneville), CLALLAM COUNTY PUD (Utility), a Public Utility District of the State of Washington, and the CITY OF PORT ANGELES (City), a municipality of the State of Washington; W I T N E S S E T H: WHEREAS the Utility and the City have entered into, or intend to enter into, an agreement whereby the Utility will provide firm capacity in its transmission or distribution system facilities for the transmission of electric power generated at the Morse Creek Hydro Project (Project), and for interconnection of the Project to the facilities of the Utility (Interconnection Agreement); and WHEREAS the Utility and Bonneville have agreed to provide firm capacity on their transmission or distribution facilities for the transmission of power from the Project to the City; and WHEREAS the City owns the Project and the transmission service occurs over the Utility's and Bonneville's facilities for delivery to the City; and WHEREAS the load which is served hereunder at the Point of Interconnection and the Point of Delivery is in the control area of Bonneville; and -2- WHEREAS Bonneville is authorized pursuant to law to dispose of electric power generated at various Federal hydroelectric projects in the Pacific Northwest, or acquired from other resources, to construct and operate transmission facilities, to provide transmission and other services, and to enter into agreements to carry out such authority; NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Term of Agreement. This agreement shall be effective commencing at 2400 hours on the date Bonneville has signed all original counterparts of this agreement (Effective Date), and unless terminated earlier pursuant to the terms of this Agreement, shall continue until 2400 hours on January 31, 2008. All obligations incurred hereunder shall continue until satisfied. Upon expiration of this agreement, Bonneville shall offer to extend transmission services provided hereunder, subject to the terms and conditions consistent with the then prevailing Bonneville rates, policy, and Federal Columbia River Transmission System (FCRTS) conditions. 2. Definition and Explanation of Terms. (a) "Electric Power" or "power" means electric peaking capacity, expressed in kilowatts, or electric energy expressed in kilowatthours, or both. (b) "Point of Delivery" means the point of delivery, described in Exhibit D, where electric power and energy are delivered to the City by Bonneville. (c) "Point of Interconnection" means the point described in Exhibit D where the project output will be made available by the Utility to Bonneville. (d) "Project" means the City's Morse Creek Hydro Project facility, described in Exhibit D, consisting of the site and generating units, and related transformation and transmission facilities. -3- (e) "Transmission Demand" means the amount specified in Exhibit C, expressed in kilowatts, which is the maximum hourly amount of electric energy to be made available to the City under this agreement at the Point of Delivery. (f) "Use -of- Facilities Charge" means the charge specified in Exhibit C, which is the monthly charge per kilowatt of Transmission Demand for the Point of Delivery; such charge has been calculated pursuant to the provisions of Exhibit A. 3. Exhibits; Interpretations. The rights and obligations of the parties with respect to provisions hereunder shall be subject to and governed by this agreement, including Exhibits A through F (Exhibits) attached hereto and by this reference made a part of this agreement. The provisions of section 38 of the General Wheeling Provisions [GWP Form -4R], Exhibit B, requires a minimum notice prior to a Rate Adjustment Date. If the rates are disapproved or conditions are placed on them by the agency authorized to approve Bonneville's transmission rates (Agency) or by any judicial interpretation of legislation by a court with jurisdiction over Bonneville, Bonneville shall not be required to give the minimum notice prior to resubmitting the rates to the Agency or implementing the Agency approved rates. The headings used in this agreement are for convenient reference only, and shall not affect the interpretation of this agreement. The City shall be the "Transferee" and the Utility and Bonneville shall be the "Transferor" referred to in the General Wheeling Provisions Exhibit. 4. Transmission of Electric Power and Energy. (a) Before power shall be made available to the City, all equipment and facilities needed for safe and reliable interconnection to Bonneville's facilities shall be installed by the City and in operation as approved by Bonneville. -4- If at any time during the term of this agreement the existence of Project generation creates disturbances on or otherwise degrades the integrity of the Federal Columbia River Transmission System (FCRTS), Bonneville may interrupt transmission services and require the City to install, or have installed at the City's expense, facilities necessary to correct such problems prior to resuming such services. In addition, Bonneville shall require use of its Revenue Metering System (RMS) meters in accordance with Section 9. (b) For each hour during the term hereof, the City shall make available or arrange to have made available to the Utility at the Utility's Morse Creek Point of Interconnection as defined in Exhibit D, and the Utility shall make available to Bonneville at the Government's Port Angeles Point of Interconnection as defined in Exhibit D, an amount of Electric Power metered at the Project less losses in accordance with Exhibit E. (c) For each hour during the term hereof, Bonneville shall make available to the City at the Point of Delivery for account of the City, the amount of Electric Power made available to Bonneville pursuant to subsection (b). (d) Bonneville shall add to the metered quantities monthly at the Point of Interconnection and subtract from the metered quantities monthly at the Point of Delivery the amount of power made available to Bonneville pursuant to subsection (b) above. (e) Nothing contained in the power sales contract between Bonneville and the Utility (Contract No. DE- MS79- 81BP90488 as amended by Amendatory Agreement No 1, dated June 3, 1982) and Bonneville and the City (Contract No. DE- MS79- 81BP90450) shall limit in any way the obligations of Bonneville or the Utility to the City to provide the firm transmission services hereunder. -5- 5. Payment Provisions. (a) The City shall pay Bonneville each month for the transmission services and the resource services provided hereunder, an amount which shall be the sum of the products obtained by multiplying each of the charges for such services by its respective multiplier. The charges and multipliers shall be as specified in Exhibit C. The resource services shall be developed and described pursuant to section 7(d). Bonneville shall make appropriate billing adjustments during periods, if any, when the operation of the Project is limited by governmental agencies having jurisdiction over air and water quality standards therefor. Any ratchet demand that may occur as determined by Bonneville pursuant to the Transmission Rate Schedules and General Transmission Rate Schedule Provisions, does not constitute an increase in any Transmission Demand approved by Bonneville, and any continued service at such level will depend on the availability of facilities as determined by Bonneville. (b) The City shall pay the Utility each month for the transmission services provided by the Utility hereunder as provided in the Interconnection Agreement. Such obligation is an obligation of the City. (c) To the extent that the billing determinants contained in Exhibit C include a demand factor, which may be represented by a "transmission demand," "contract demand," "measured demand" or other type of demand quantity, the billing demand and ratchet provisions, if any, of the General Transmission Rate Schedule Provisions contained in Exhibit A shall apply to the calculation of payments. 6. Termination of Agreement and Charges. This agreement may be terminated with mutual consent of the parties, which consent shall not be unreasonably withheld, (1) upon destruction or abandonment of the Project; -6- (2) upon discontinuation of Project output under a final order of a public official having authority to issue such order; (3) upon termination of the Interconnection Agreement between the City and the Utility for the transfer of power for the Project; (4) upon denial of a license to construct and operate the Project from the Federal Energy Regulatory Commission (FERC) or its successor agency (Agency). This agreement may not be terminated by reason of a partial reduction in generating capability. If this agreement is terminated earlier than the term described in section 1 above, or if there is a partial reduction in generating capability, the City shall pay Bonneville as follows: (a) for the unamortized nonsalvable investment plus the cost of removal of any facilities Bonneville has constructed at Government expense for the purpose of providing transmission service for the Project hereunder; or (b) monthly at a rate that shall compensate Bonneville for the annual cost of the facilities so constructed, to the extent such facilities become unusable in whole or in part as the result of such destruction or abandonment of the Project or upon such partial permanent reduction or discontinuation of Project Output. The payment obligations in this section shall be the obligation of the City. 7. Revision of Exhibits. (a) The Use -of- Facility Transmission rate schedule attached hereto as Exhibit A has been finally confirmed and approved by the Agency. The rate schedule in Exhibit A shall be replaced by successor rate schedules in accordance with the provisions of section 7(i) of the Pacific Northwest Power Act and Agency rules. The Use -of- Facilities Charge specified in Exhibit C shall be recalculated following any rate filing according to the provisions of -7- such amended, modified, or successor rate schedules and associated provisions, and Bonneville shall prepare a new Exhibit C incorporating the revised Use -of- Facilities Charge. (b) If Bonneville determines that the charges specified in Exhibit C or any subsequent charges specified in this agreement must be changed pursuant to sections 19 or 38 of Exhibit B, it shall prepare a new Exhibit C incorporating such changes. Such new Exhibit C shall be substituted for the Exhibit C then in effect and shall become effective as of the date specified therein. (c) The loss factor specified in Exhibit E may be revised from time to time upon notification by the City and Utility, or Bonneville's determination that conditions at the Project or on the Utility's system have changed sufficiently to warrant recalculating the loss factor. Bonneville shall calculate the new loss factor and submit to the City and Utility by letter pursuant to Exhibit E. (d) Exhibit F shall be revised to include charges for resource services which Bonneville provides for the Project or upon determination by Bonneville that any such resource service charge contained therein must be changed to properly compensate Bonneville for providing such services. The resource services may include, but shall not be limited to, such services as operating reserves and making available amounts of power and energy to the City, pursuant to section 4(c) above, which vary from the amounts of actual Project generation. The resource service charge set forth in Exhibit F shall not be increased more frequently than once during any consecutive 12 month period. Bonneville shall provide the City and Bonneville's other customers with a reasonable opportunity of not less than 90 days to comment prior to the effective date of such proposed revised charges. Revised charges shall take effect on the date specified by Bonneville in its written notice to the City of its intention to revise such charge. -8- 8. Reactive Power. It is the intent of the parties hereto that the voltage level at the Points of Interconnection and the Points of Delivery be controlled in accordance with prudent utility operating practice. The parties hereto shall jointly plan and operate their systems so as not to place an undue burden on the other party to supply or absorb reactive power accompanying or resulting from deliveries hereunder. 9. Metering Equipment. Bonneville shall require use of a Revenue Metering System (RMS) unit or like unit meeting Bonneville's specifications to meter output from the Project. Bonneville shall perform all 0 &M services on the RMS unit. Likewise, the City shall use JEM meters, or equivalent, to determine output from the Project; and the City shall perform all 0 &M service on its meter. The cost associated with the purchase and maintenance of the RMS unit including repair or replacement shall be at the City's expense. The original purchase of the RMS unit is provided under Agreement No. DE- AI79- 87BP72149. Installation of telecommunications equipment for both Bonneville and City metering equipment and all service charges shall be at the City's expense. Ownership of the RMS equipment shall remain with the Government. 10. Several Obligations. Except where specifically stated in this agreement to be otherwise, the duties, obligations, and liabilities of the parties are intended to be several and not joint or collective. Nothing contained in this agreement shall ever be construed to create an association, trust, partnership, or joint venture or to impose a trust or partnership duty, obligation, or liability on or with regard to any party. Each party shall be individually and severally liable for its own obligation under this agreement. -9-- 11. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in several counterparts. By -10- Date CLALLAM COUNTY PUD ATTEST: By By Title Title Date Date CITY OF PORT ANGELES ATTEST: By By Title Title Date Date (VS6- PMT- 0758e) UNITED STATES OF AMERICA Department of Energy Bonneville Power Administration Government' Port Angeles Substation 69 kV Bay 26 Approved Point of Delivery Government's Port Angeles Substation 69 kV Bay 23 1/ Composite UFT charge based on Bay's 23 and 26. (4427j) Transmission Parameters Revision No. 1 Exhibit C, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1990 A. Points of Interconnection, Points of Delivery, Transmission Demands, Use -of- Facilities Charges, and Resources. Approved Point Use -of- Resource(s) of Interconnection Transmission Facilities to be (Voltage) Demand Charge Integrated 485 kW $0.098 /kW -mo 1/ Morse Creek B. Calculation of Charges Pursuant to the UFT -83 Rate Schedule: Facility Government's Port Angeles Substation 69 kV Bay 26 Bay 23 I &A 2/ I &A 0 &M 1/ Sum of Annual Annual Annual Non Coincidental (Sponsor) Investment Cost Ratio Cost Cost Demand /kW /yr. Demand 6/ $160,631 8.8% $14,136 6,331 27,985 kW 3/ 0.731 485 kW $257,740 8.8% $22,681 6,331 64,980 kW 4/ 0.446 485 kW Total UFT Charge $1.177 /kW -yr. 5/ $0.098 /kW -mo. 1/ 0 &M charge based on low voltage terminal in 2 -2 -90 0 &M cost tables. 2/ Taken from 5 -1 -90 ACR table, column (8) minus column (5), Type S5 Substation. 3/ J91 peak loads from Clallam Eastern (27,500 kW) plus Morse Creek (485 kW). 4/ J91 peak loads from Port Angeles City No. 1 (61.25 of Port Angeles City Nos. 1 and 2) plus Morse Creek (485 kW) plus Clallam Eastern (27,500 kW). (61.25% X 60,400) 485 27,500 64,980 kW. 5/ Unit Charge (I &A Annual Cost) 0 &M Annual Cost /kW yr. Sum of Non Coincidental Demands Monthly Charge /kW yr) (Sponsor Demand) /mo. 12 months 6/ Ratchets shall be handled in accordance with section 5(c). (4427j) Revision No. 1 Exhibit C, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1990 Exhibit D, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1990 Description of Project, Point of Interconnection, and Points of Delivery 1. MORSE CREEK HYDRO PROJECT Location: the project is located in the NW 1/4 of Section 29, T3ON, R5W, Willamette Meridian, Clallam County, Washington; approximately 3 miles east of Port Angeles and 1 -1/2 to 2 miles south of state route 101 and primarily east of Glass Road; Demand: 485 kW; Voltage: 12.5 kV; Metering: in the City's powerhouse, in the 480 volt circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for transformation losses between the Project point of metering and the high side of the Project transformer. 2. MORSE CREEK POINT OF INTERCONNECTION Location: A point on the Utility's distribution line approximately one half mile from the Morse Creek Hydro Project at the junction of Glass and Boyd Roads where the distribution lines of the Utility and the line from the City's Project interconnect; Voltage: 12.5 kV; Adjustments: there shall be an adjustment for transmission losses between the Morse Creek Hydro Project and the Morse Creek Point of Interconnection. 3. PORT ANGELES POINT OF INTERCONNECTION Location: the point in Bay 26 (Clallam Co. PUD's Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the Utility and the Government are connected; Voltages: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for distribution losses between the Utility's Morse Creek Point of Interconnection and the Government's Port Angeles Point of Interconnection. 4. PORT ANGELES POINT OF DELIVERY (4427j) Voltages: 69 kV; Exhibit D, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1990 Location: the point in Bay 23 (Port Angeles Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the City and the Government are connected; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be no adjustment for losses between the Point of Interconnection and the Point of Delivery. (4427j) Loss Factors Exhibit E, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1990 The losses specified in Exhibit D under Points of Interconnection and Points of Delivery shall consist of two components. The first is the transformation and transmission losses from the Project to the Morse Creek Point of Interconnection, and the second is the transmission and transformation losses from the Morse Creek Point of Interconnection to the Port Angeles Point of Interconnection. No losses shall be applied between the Port Angeles Point of Interconnection and the Port Angeles Point of Delivery as specified in Exhibit D. The losses between the Project Point of Metering and the Port Angeles Point of Interconnection shall be submitted to the City and the Utility by Bonneville by separate letter. The revision of these losses shall be as specified in section 7(c). Resource service charges shall be incorporated into Exhibit F as developed by Bonneville according to section 7(d) of this agreement. As of the Effective Date of this Agreement, the Resource service charge is zero. (4427j) Resource Services Exhibit F, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Effective at 2400 hours on September 30, 1990 1989 Transmission Rate Schedules and General Transmission Rate Schedule Provisions E xhibit A United States Department of Energy Bonneville Power Administration 905 NE 11th Avenue Portland, Oregon 97232 Bonneville Power Administration's 1989 Transmission Rate Schedules and General Transmission Rate Schedule Provisions were approved on an interim basis by the Federal Energy Regulatory Commission, United States Department of Energy, in a commission order issued September 29, 1989 (Docket Nos. EF89-2021 -000, et al.). These rate schedules and provisions became effective October 1, 1989. These rate schedules and provisions supersede the Administration's Transmission Rate Schedules and General Transmission Rate Schedule Provisions effective October 1, 1987. Exist- ing rate schedules UFT 83 and TGT 1, for which final approval has been extended, are also included in this brochure. TRANSMISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS Current Transmission Rate Schedules Page FPT 89.1 Formula Power Transmission 1 FPT -89.3 IR -89 IS -89 1N -89 1E -89 ET-89 MT -89 Extension of Existing Transmission Rate Schedules 9 UFT -83 10 TGT -1 11 General Transmission Rate Schedule Provisions SECTION! SECTION!! SECTION III SECTION IV TABLE OF CONTENTS Formula Power Transmission 2 Integration of Resources 3 Southern Intertie Transmission 4 Northern Intertie Transmission 5 Eastern Intertie Transmission 6 Energy Transmission 7 Market Transmission 8 Adoption of Revised Transmission Rate Schedules and General Transmission Rate Schedule Provisions 13 Billing Factor Definitions and Billing Adjustments 13 Other Definitions 14 Billing Information 15 SECTION I. AVAILABILITY This schedule is identical to and supersedes schedule FPT 87.1 for all firm transmission agree- ments which provide that rates may be adjusted not more frequently than once a year. It is available for firm transmission of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This schedule is for full -year and partial year service and for either continuous or intermit- tent service when firm availability of service is re- quired. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this rate schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE A. Full -Year Service The monthly charge per kilowatt of billing de- mand shall be one twelfth of the sum of the Main Grid Charge, the Secondary System Charge, and Intertie Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component fac- tors as specified in the Agreement: a. Main Grid Distance Factor: The amount computed by multiplying the Main Grid Distance by $0.0250 per mile; b. Main Grid Interconnection Terminal Factor: $0.20; c. Main Grid Terminal Factor: $0.25; d. Main Grid Miscellaneous Facilities Factor: $1.04; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following compo- nent factors as specified in the Agreement: TRANSMISSION RATE SCHEDULES SCHEDULE FPT 89.1 FORMULA POWER TRANSMISSION 1 a. Secondary System Distance Factor: The amount determined by multiplying the Sec- ondary System Distance by $0.1255 per mile; b. Secondary System Transformation Factor: $1.95; c. Secondary System Intermediate Terminal Factor: $0.72; d. Secondary System Interconnection Termi- nal Factor: $0.36; 3. Intertie Charge For use of the Southern Intertie facilities: $5.21. B. Partial -Year Service The monthly charge per kilowatt of billing de- mand shall be as specified in Section II.A for all months of the year except for agreements whose term is 5 years or less and which specify service for fewer than 12 months per year, the monthly charge shall be: 1. during months for which service is speficied, the monthly charge defined in Section II.A, and 2. during other months, the monthly charge de- fined in Section II.A multiplied by 0.2. SECTION 111. BILLING FACTORS Unless otherwise stated in the Agreement, the bill- ing demand shall be the largest of: A. the Transmission Demand; B. the highest hourly Scheduled Demand for the month; or C. the Ratchet Demand. SECTION I. AVAILABILITY This schedule is identical to and supersedes schedule FPT 87.3 for all firm transmission agree- ments which provide that rates may be adjusted not more frequently than once every 3 years. It is available for firm transmission of electric power and energy using the Main Grid and /or Secondary Sys- tem of the FCRTS. This schedule is for full -year and partial -year service and for either continuous or intermittent service when firm availability of service is required. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this rate schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE A. Full Year Service The monthly charge per kilowatt of billing de- mand shall be one twelfth of the sum of the Main Grid Charge, the Secondary System Charge, and Intertie Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component fac- tors as specified in the Agreement: a. Main Grid Distance Factor: The amount computed by multiplying the Main Grid Distance by $0.0250 per mile; b. Main Grid Interconnection Terminal Factor: $0.20; c. Main Grid Terminal Factor: $0.25; d. Main Grid Miscellaneous Facilities Factor: $1.04; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following compo- nent factors as specified in the Agreement: a. Secondary System Distance Factor: The amount determined by multiplying the Sec- ondary System Distance by $0.1255 per mile; SCHEDULE FPT 89.3 FORMULA POWER TRANSMISSION 2 b. Secondary System Transformation Factor: $1.95; c. Secondary System Intermediate Terminal Factor: $0.72; d. Secondary System Interconnection Termi- nal Factor: $0.36; 3. Intertie Charge For use of the Southern Intertie facilities: $5.21. B. Partial Year Service The monthly charge per kilowatt of billing de- mand shall be as specified in Section II.A for all months of the year except for agreements whose term is 5 years or less and which specify service for fewer than 12 months per year, the monthly charge shall be: 1. during months for which service is speficied, the monthly charge defined in Section II.A, and 2. during other months, the monthly charge de- fined in Section II.A multiplied by 0.2. SECTION III. BILLING FACTORS Unless otherwise stated in the Agreement, the bill- ing demand shall be the largest of: A. the Transmission Demand; B. the highest hourly Scheduled Demand for the month; or C. the Ratchet Demand. 1 1 SECTION 1. AVAILABILITY This schedule is identical to and supersedes IR -87 and is available for firm transmission service for electric power and energy using the Main Grid and/ or Secondary System of the FCRTS. The definitions of Main Grid and Secondary Sytems are the same as for the FPT 89.1 and FPT -89.3 rate schedules and are contained in the General Transmission Rate Schedule Provisions. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The monthly charge shall be the sum of A and B where: A. The Demand Charge shall be: 1. $0.2600 per kilowatt of billing demand; or 2. for Points of Integration (P01) specified in the Agreement as being short distance POI's, for which Main Grid and Secondary System facilities are used for a distance of less than 75 circuit miles, the following formula applies: [0.2 (0.8/75 x transmission distance)] ($0.2600 per kilowatt of billing demand) Where: the billing demand for a short distance POI is the demand level specified in the Agree- ment for such POI, and the transmission dis- tance is the circuit miles between the POI for a generating resource of the customer and a designated Point of Delivery (POD) serving the load of the customer. Short distance POI's are determined by BPA after considering fac- tors in addition to transmission distance. B. The Energy Charge shall be: 0.85 mills /kWh of billing energy. SCHEDULE IR -89 INTEGRATION OF RESOURCES 3 SECTION III. BILLING FACTORS To the extent that the Agreement provides for the customer to be billed for transmission in excess of the Transmission Demand or Total Transmission De- mand, as defined in the Agreement, at the nonfirm transmission rate (currently ET-89), such transmis- sion service shall not contribute to either the Billing Demand or the Billing Energy for the IR rate pro- vided that the customer requests such treatment and BPA approves in accordance with the prescribed provisions in the Agreement. A. Billing Demand The billing demand shall be the largest of: 1. the Transmission Demand, except under Gen- eral Transmission Agreements where a Total Transmission Demand is defined; 2. the highest hourly Scheduled Demand for the month; or 3. the Ratchet Demand. B. Billing Energy The billing energy shall be the monthly sum of scheduled kilowatthours. SECTION I. AVAILABILITY This schedule is identical to and supersedes IS -87 and is available for all transmission on the Southern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE A. Nonfirm Rate The charge for nonfirm transmission of non -BPA power shall be 1.4 mills /kWh of billing energy. This charge applies for both north -to -south and south -to -north transactions. B. Firm Power Transmission Rate The charge for firm transmission service granted access by BPA shall be $0.360 per kW per month of billing demand and 0.69 mills /kWh of billing energy. Firm transmission will only be made avail- able to customers under this rate schedule who have executed a contract with BPA specifying use of the Firm Power Transmission rate for either north -to -south or south -to -north transactions. SECTION 111. BILLING FACTORS A. For services under Section II.A, the billing energy shall be the monthly sum of the scheduled kilowatthours, plus the monthly sum of kilowatthours allocated but not scheduled. The amount of allocated but not scheduled energy that is subject to billing may be reduced prorata by BPA due to forced Intertie outages, and other uncontrollable forces that may reduce Intertie capacity. The amount of allocated but not scheduled energy that is subject to billing also may be reduced upon mutual agreement between BPA and the customer. B. For services under Section II.B, the billing de- mand shall be the Transmission Demand as de- fined in the Agreement. The billing energy shall be the monthly sum of scheduled kilowatthours, unless otherwise specified in the Agreement. SCHEDULE IS -89 SOUTHERN INTERTIE TRANSMISSION SECTION I. AVAILABILITY This schedule is identical to and supersedes IN -87 and is available for all transmission on the Northern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for transmission of non -BPA power on the Northern Intertie shall be 1.05 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. SCHEDULE IN -89 NORTHERN INTERTIE TRANSMISSION SECTION I. AVAILABILITY This schedule is identical to and supersedes IE -87 and is available for all nonfirm transmission on the Eastern Intertie. Service under this schedule is sub- ject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE The charge for transmission of nonfirm energy on the Eastern Intertie shall be 2.08 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. SCHEDULE IE -89 EASTERN INTERTIE TRANSMISSION SECTION I. AVAILABILITY This schedule is identical to and supersedes ET-87, unless otherwise specified in the Agreement, with respect to delivery using FCRTS facilities other than the Southern Intertie, Eastern Intertie, or the North- ern Intertie, and is available for nonfirm transmis- sion between points within the Pacific Northwest. BPA may interrupt service which is provided under this rate schedule. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for such nonfirm transmission of non Federal electric energy shall be 1.61 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of scheduled kilowatthours. SCHEDULE ET-89 ENERGY TRANSMISSION 7 SECTION I. AVAILABILITY This schedule is identical to and supersedes MT-87 and is available for transactions using FCRTS facilities pursuant to the Western Systems Power Pool (WSSP) Agreement. Service under this schedule is subject to BPA's General Transmission Rate Schedule Pro- visions. SECTION II. RATE The charge shall be determined in advance by BPA. The charge shall not exceed 33 percent of the differ- ence between the highest Decremental Cost of gen- eration of the WSPP and the lowest Decremental Cost of generation of the WSPP as determined by the WSPP Operating Committee during the year prior to the effective date of the WSPP Agreement. The Operating Committee may determine that a subsequent redetermination is necessary based upon the immediately preceding year's experience. However, the transmission charge shall not be less than 1 mill per kilowatthour. SECTION III. BILLING FACTORS The billing factors shall be specified in advance by BPA, as to representing the Transmission Service use or reservation. SCHEDULE MT -89 MARKET TRANSMISSION 8 Extension of Existing Transmission Rate Schedules UFT -83 and TGT -1 The Bonneville Power Administration received extension of final approval for wheeling rate schedules UFT 83 and TGT 1, from the Federal Energy Regulatory Commission, United States Department of Energy, in a commission order issued September 29, 1989, (Docket Nos. EF85- 2021 -001, et al.). These rate schedules are in effect through September 30, 1991. 9 SECTION I. AVAILABILITY This schedule supersedes UFT-1, and UFT-2, unless otherwise provided in the Agreement, and is available for firm transmission over specified FCRTS facilities. SECTION II. RATE The monthly charge per kilowatt of Transmission Demand specified in the Agreement shall be one twelfth of the annual cost of capacity of the specified facilities divided by the sum of Transmission De- mands (in kilowatts) using such facilities. Such an- nual cost shall be determined in accordance with Section III. SECTION 111. DETERMINATION OF TRANSMISSION RATE A. From time to time, but not more often than once in each Contract Year, BPA shall determine the fol- lowing data for the facilities which have been con- structed or otherwise acquired by BPA, and which are used to transmit electric power and energy: 1. The annual cost of the Specified FCRTS facilities, as determined from the capital cost of such facilities and annual cost ratios de- veloped from the FCRTS financial statement, including interest and amortization, operation and maintenance, administrative and general, and general plant costs. 2. The yearly noncoincident peak demands of all users of such facilities or other reasonable measurement of the facilities' peak use. B. The monthly charge per kilowatt of billing de- mand shall be one twelfth of the sum of the an- nual cost of the FCRTS facilities used divided by the sum of Transmission Demands. The annual cost per kilowatt of Transmission Demand f r a facility constructed or otherwise acquired by BPA shall be determined in accordance with the following formula: A D where: A The annual cost of such facility as deter- mined in accordance with A.1. above. SCHEDULE UFT -83 USE -OF- FACILITIES TRANSMISSION 10 D The sum of the yearly coincident demands on the facility as determined in accordance with A.2. above. The annual cost per killowatt of facilities listed in the Agreement which are owned by another entity, and used by BPA for making deliveries to the transferee, shall be determined from the costs specified in the Agreement between BPA and such other entity. SECTION IV. DETERMINATION OF BILLING DEMAND Unless otherwise stated in the Agreement, the factor to be used in determining the kilowatts of billing demand is the largest of: A. the Transmission Demand in kilowatts specified in the Agreement; B. the highest hourly Measured or Scheduled De- mand for the month, the Measured Demand being adjusted for power factor; or C. the Ratchet Demand. SECTION 1. AVAILABILITY This schedule shall apply to all agreements which pro- f vide for the firm transmission of electric power and energy over transmission facilities of BPA's section of the Montana [Eastern] Intertie. SCHEDULE TGT 1 TOWNSEND GARRISON TRANSMISSION SECTION II. RATE The monthly charge shall be one twelfth of the sum of the annual charges listed below, as applicable and as specified in the agreements for firm transmission. The Townsend Garrison 500 -kV lines and associated terminal, line compensation, and communication facilities are a separately identified portion of the Fed- eral Transmission System. Annual revenues plus cre- dits for Government use should equal annual costs of the facilities, but in any given year there may be either a surplus or a deficit. Such surpluses or deficits for any year shall be accounted for in the computation of annual costs for succeeding years. Revenue re- quirements for firm transmission use will be de- creased by any revenues received from nonfirm use and credits for all Government use. The general methodology for determining the firm rate is to divide the revenue requirement by the total firm capacity re- quirements. Therefore, the higher the total capacity requirements, the lower will be the unit rate. If the Government provides firm transmission service in its section of the Montana [Eastern] Intertie in ex- change for firm transmission service in a customer's section of the Montana Intertie, the payment by the Government for such transmission services provided by such customer will be made in the form of a credit in the calculation of the Intertie Charge for such cus- tomer. During an estimated 1- to 3 -year period follow- ing the commercial operation of the third generating unit at the Colstrip Thermal Generating Plant at Col strip, Montana, the capability of the Federal Transmis- sion System west of Garrison Substation may be differ- ent from the long -term situation. It may not be possi- ble to complete the extension of the 500 -kV portion of the Federal Transmission System to Garrision by such commercial operation date. In such event, the 500/230 -kV 11 transformer will be an essential extension of theTown- send- Garrison Intertie facilities, and the annual costs of such transformer will be included in the calculation of the Intertie Charge. However, starting 1 month after extension to Garrison of the 500 -kV portion of the Federal Transmission Sys- tem, the annual costs of such transformer will no longer be included in the calculation of the Intertie Charge. A. Nonfirm Transmission Charge: This charge will be filed as a separate Rate Sched- ule and revenues received thereunder will reduce the amount of revenue to be collected under the Intertie Charge below. B. Intertie Charge for Firm Transmission Service: (CR EC) Intertie Charge [(TAC /12 NFR X TCR SECTION I11. DEFINITIONS A. TAC Total Annual Costs of facilities associated with the Townsend Garrison 500 -kV Transmission line including terminals, and prior to extension of the 500 -kV portion of the Federal Transmission System to Garrison, the 500/230 -kV transformer at Garrison. Such annual costs are the total of (1) interest and amortization of associated Fed- eral investment and the appropriate allocation of general plant costs; (2) operation and mainte- nance costs; (3) allowance for Bonneville's gen- eral administrative costs which are appropriately allocable to such facilities, and (4) payments made pursuant to section 7(m) of Public Law 96- 501 with respect to these facilities. Total Annual Costs shall be adjusted to reflect reductions to unpaid total costs as a result of any amounts re- ceived, under agreements for firm transmission service over the Montana Intertie, by the Gov- ernment on account of any reduction in Trans- mission Demand, termination or partial termina- tion of any such agreement or otherwise to com- pensate BPAforthe unamortized investment, an- nual cost, removal, salvage, or other cost related to such facilities. B. NFR Nonfirm Revenues, which are equal to (1) the product of the Nonfirm Transmission Charge described in II.A above, and the total nonfirm energy transmitted over the Townsend Garrison line segment under such charge for such month; plus (2) the product of the Nonfirm Transmission Charge and the total nonfirm energy transmitted in either direction by the Government over the Townsend Garrison line segment for such month. C. CR Capacity Requirement of a customer on the Townsend Garrison 500 -kV transmission facilities as specified in its firm transmission agreement. D. TCR Total Capacity Requirement on the Town- send- Garrison 500 -kV transmission facilities as calculated by adding (1) the sum of all Capacity Requirements (CR) specified in transmission agreements described in Section I; and (2) the Government's firm capacity requirement. The Government's firm capacity requirement shall be no Tess than the total of the amounts, if any, specified in firm transmission agreements for use of the Montana Intertie. E. EC Exchange credit for each customer which is the product of (1) the ratio of investment in the Townsend Broadview 500 -kV transmission line to the investment in the Townsend Garrison 500 -kV transmission line; and (2) the capacity which the Government obtains in the Townsend- Broadview 500 -kV transmission line through ex- change with such customer. If no exchange is in effect with a customer, the value of EC for such customer shall be zero. 12 GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS SECTION I. ADOPTION OF REVISED TRANS- MISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS A. Approval of Rates These rates schedules and General Transmission Rate Schedule Provisions (GTRSP) shall become effective upon approval by the Federal Energy Regulatory Commission. BPA will request FERC approval effective October 1, 1989. BPA is re- questing that all proposed Transmission Rate Schedules be effective for a period of 2 years, from October 1, 1989, through September 30, 1991, with the exception of the TGT 1 and UFT 83 Rate Schedules which would be effective from July 1,1990, through September 30,1991. Approval of the FPT 87.3 Rate Schedule (renamed the FPT 89.3 Rate Schedule on October 1, 1989) is re- quested for a period of 1 year, from October 1, 1990, through September 30, 1991. B. General Provisions These 1989 Transmission Rate Schedules and as- sociated GTRSP are identical to and supersede BPA's 1987 Transmission Rate Schedules and GTRSP (which became effective October 1, 1987) but do not supersede prior rate schedules re- quired by agreement to remain in force. Transmission service provided shall be subject to the following Acts, as amended: the Bonneville Project Act, the Regional Preference Act (P.L. 88- 552), the Federal Columbia River Transmission System Act, and the Pacific Northwest Electric Power Planning and Conservation Act. The meaning of terms used in the transmission rate schedules shall be as defined in agreements or provisions which are attached to the Agree- ment or as in any of the above Acts. C. Interpretation If a provision in the executed Agreement is in conflict with a provision contained. herein,.the former shall prevail. SECTION II. BILLING FACTOR DEFINITIONS AND BILLING ADJUSTMENTS A. Billing Factors 1. Scheduled Demand The largest hourly amounts wheeled which are scheduled by the customer during the time period specified in the rate schedules. 13 2. Metered Demand The Metered Demand in kilowatts shall largest of the 60- minute clock -hour integrat demands measured by meters installed at ea POD during each time period specified in t applicable rate schedule. Such measuremei shall be made as specified in the Agreeme BPA, in determining the Metered Demar will exclude any abnormal readings due to resulting from (a) emergencies or breakdov% on, or maintenance of, the FCRTS; (b) emergencies on the customer's faciliti provided that such facilities have be adequately maintained and prudently op ated as determined by BPA. If more than o class of power is delivered to any POD, t portion of the metered quantities assigned any class of power shall be as agreed to by t parties. The amount so assigned shall con tute the Metered Demand for such class power. 3. Transmission Demand The demand as defined in the Agreement, 4. Total Transmission Demand The sum of the transmission demands as fined in the Agreement. 5. Ratchet Demand The maximum demand established during 1 previous 11 billing months. Exception: I Transmission Demand or Total Transmissi Demand has been decreased pursuant to 1 terms of the Agreement during the previc 11 billing months, such decrease will be flected in determining the Ratchet Deman B. Billing Adjustments Average Power Factor The adjustment for average power factor, wl- specified in a transmission rate schedule or the Agreement, shall be made in accordar with the average power factor section of 1 General Wheeling Provisions. To maintain acceptable operating conditions the Federal system, BPA may restrict deliver of power at any time that the average lead power factor or average lagging power factor all classes of power delivered to such point to such system is below 85 percent. SECTION III. OTHER DEFINITIONS Definitions of the terms below shall be applied to these provisions and the Transmission Rate Sched- ules, unless otherwise defined in the Agreement. A. Agreement An agreement between BPA and a customer to which these rate schedules and provisions may be applied. B. Decremental Cost As used in the MT rate schedule, Decremental Cost is as defined in the WSPP Agreement. C. Eastern Intertie The segment of the FCRTS for which the transmis- sion facilities consist of the Townsend Garrison double- circuit 500 kV transmission line segment including related terminals at Garrison. D. Electric Power Electric peaking capacity (kW) and /or electric energy (kWh). E. Federal Columbia River Transmission System (FCRTS) The transmission facilities of the Federal Colum- bia River Power System (FCRPS), which include all transmission facilities owned by the Government and operated by BPA, and other facilities over which BPA has obtained transmission rights. F. Firm Transmission Service Transmission service which BPA provides for any non -BPA power except for transmission service which is scheduled as nonfirm. If the firm service is provide pursuant to the Agreement, the terms of the Agreement may further define the service. G. Integrated Network The segment of the FCRTS for which the trans- mission facilities provide the bulk of transmission of electric power within the Pacific Northwest, excluding facilities not segmented to the net- work in the Wholesale Power Rate Development Study used in BPA's rate development. H. Main Grid As used in the FPT and IR rate schedules, that portion of the Integrated Network with facilities rated 230 kV and higher. 1. Main Grid Distance As used in the FPT rate schedules, the distance in airline miles on the Main Grid between the POI and the POD, multiplied by 1.15. 14 J. Main Grid Interconnection Terminal As used in the FPT rate schedules, Main Grid ter- minal facilities that interconnect the FCRTS with non -BPA facilities. K. Main Grid Miscellaneous Facilities As used in the FPT rate schedules, switching, transformation, and other facilities of the Main Grid.not included in other components. L. Main Grid Terminal As used in the FPT rate schedules, the Main Grid terminal facilities located at the sending and /or receiving end of a line exclusive of the Intercon- nection terminals. M. Nonfirm Transmission Service Interruptible transmission service which BPA may provide for non -BPA power. N. Northern Intertie The segment of the FCRTS for which the trans- mission facilities consist of two 500 kV lines be- tween Custer Substation and the United States Canadian border, one 500 kV line between Cus- ter and Monroe Substations, and two 230 kV lines from Boundary Substation to the United States Canadian border, and the associated sub- station facilities. O. Point of Integration (P01) Connection points between the FCRTS and non BPA facilities where non Federal power is made available to BPA for wheeling. R Point of Delivery (POD) Connection points between the FCRTS and non BPA facilities where non Federal power is deliv- ered to a customer by BPA. Q. Secondary System As used in the FPT and IR rate schedules, that portion of the Integrated Network facilities with operating voltage of 115 kV or 69 kV. R. Secondary System Distance As used in the FPT rate schedules, the number of circuit miles of Secondary System transmis- sion lines between the secondary POI or the Main Grid and the POD or the lower voltage FCRTS facilities which may be used on a use -of- facility basis. S. Secondary System Interconnection Terminal As used in the FPT rate schedules, the terminal facilities on the Secondary System that intercon- nect the FCRTS with non -BPA facilities. 1 T. Secondary System Intermediate Terminal As used in the FPT rate schedules, the first and final terminal facilities in the Secondary System transmission path exclusive of the Secondary System Interconnection terminals. U. Secondary Transformation As used in the FPT rate schedules, transforma- tion from Main Grid to Secondary System facilities. V. Southern Intertie The segment of the FCRTS for which the major transmission facilities consist of two 500 kV AC lines from John Day Substation to the Oregon California border, a portion of the 500 kVAC line from Buckley Substation to Summer Lake Sub- station, and one 1,000 kV DC line between the Celilo Substation and the Oregon- Nevada bor- der, and associated substation facilities. W. Transmission Service As used in the MT rate schedule, Transmission Service is as defined in the WSPP Agreement. SECTION IV. BILLING INFORMATION A. Payment of Bills Bills for transmission service shall be rendered monthly by BPA. Failure to receive a bill shall not release the customer from liability for payment. Bills for amounts due of $50,000 or more must be paid by direct wire transfer; customers who expect that their average monthly bill will not ex- ceed $50,000 and who expect special difficulties in meeting this requirement may request, and BPA may approve, an exemption from this re- quirement. Bills for amounts due BPA under $50,0000 may be paid by direct wire tansfer or mailed to the Bonneville Power Administration, P.O. Box 6040, Portland, Oregon 97228 -6040, or to another location as directed by BPA. The pro- cedures to be followed in making direct wire transfers will be provided by the Office of Finan- cial Management and updated as necessary. 1. Computation of Bills The transmission billing determinant is the electric power quantified by the method specified in the Agreement or Transmission Rate Schedule. Scheduled power or metered power will be used. The transmission customer shall provide necessary information to BPA for any compu- tation required to determine the proper charges for use of the FCRTS, and shall coc erate with BPA in the exchange of additior information which may be reasonably use for respective operations. Demand and energy billings for transmissil service under each applicable rate schedL shall be rounded to whole dollar amounts, eliminating any amount which is less than cents and increasing any amounts from cents through 99 cents to the next higher d lar. 2. Estimated Bills At its option, BPA may elect to render an e mated bill to be followed at a subsequent b ing date by a final bill. The estimated bill sh have the validity of and be subject to the sar payment provisions as a final bill. 3. Due Date Bills shall be due by close of business on t 20th day after the date of the bill (due dat Should the 20th day be a Saturday, Sunday, holiday (as celebrated by the customer), t due date shall be the next following businE day. 4. Late Payment Bills not paid in full on or before close of b iness on the due date shall be subject to a pE alty charge of $25. In addition, an inter( charge of one twentieth percent (0.05 p cent) shall be applied each day to the sum the unpaid amount and the penalty chart This interest charge shall be assessed on daily basis until such time as the unpx amount and penalty charge are paid in ful Remittances received by mail will be accept without assessment of the charges referred in the preceding paragraph provided the pc mark indicates the payment was mailed on before the due date. Whenever a power 1 or a portion thereof remains unpaid st sequent to the due date and after giving days advance notice in writing, BPA may cs cel the contract for service to the custom However, such cancellation shall not affect t customer's liability for any charges accru prior thereto under such agreement. 5. Disputed Billings In the event of a disputed billing, full paymE shall be rendered to BPA and the disput amount noted. Disputed amounts are subjt to the late payment provisions specified above. BPA shall separately account for the disputed amount. If it is determined that the customer is entitled to the disputed amount, BPA shall refund the disputed amount with in- terest, as determined by BPA's Office of Finan- cial Management. BPA retains the right to verify, in a manner satisfactory to the Administrator, all data sub- mitted to BPA for use in the calculation of BPA's rates and corresponding rate adjust- ments. BPA also retains the right to deny eligi- bility for any BPA rate or corresponding rate adjustment until all submitted data have been accepted by BPA as complete, accurate, and appropriate for the rate or adjustment under consideration. 6. Revised Bills At its option, BPA may render a revised bill. A revised bill shall replace all previous bills is- sued by BPA that pertain to`a specified cus- tomer for a specified billing period if the amount of the revised bill is Tess than the amount of the original bill. If the amount of the revision causes an additional amount to be due BPA beyond the original bill, a revised bill will be issued for the difference. The date of the revised bill shall be deter- mined as follows: a. If the amount of the revised bill is equal to or Tess than the amount of the bill which it is replacing, the revised bill shall have the same date as the replaced bill. b. If the amount of the revised bill is greater than the amount of the bill which it is re- placing, the date of the revised bill shall be its' date of issue. 16 In reply refer to PMT Mr. Robert J. Titus Director City of Port Angeles P.O. Box 1150 Port Angeles, WA 98362 Dear Mr. Titus: Department of Energy Bonneville Power Administration Public Involvement P.O. Box 12999 Portland, Oregon 97212 -0999 SEP i 3 1989 Contract No. DE- MS79- 89BP92824 On November 15, 1988, The City of Port Angeles (City) and Bonneville Power Administration (Bonneville) executed a short term letter agreement for firm wheeling services effective from 2400 hours June 30, 1988 to September 30, 1989. In that agreement, the parties acknowledged that nonfirm wheeling services for the Morse Creek Project (Project) were provided from October 20, 1987 through June 30, 1988. It was the parties' desire to operate under this arrangement pending resolution of Articles 19 -25 of the FERC license. Currently, Washington Department of Fisheries has environmental concerns and recognizes that Articles 21 -23 of the FERC license will not be resolved by September 30, 1989. Because of the unresolved article compliance, Bonneville proposes that firm wheeling services can be continued as follows: 1. Term. This letter agreement shall be effective at 2400 hours on September 30, 1989 and shall terminate at 2400 hours on the earlier of: (a) the effective date of the Long -Term Agreement, Contract No. DE- MS79- 89BP92315, (Exhibit A) or (b) 2400 hours on September 30, 1990; provided, however, that all liabilities incurred hereunder shall be preserved until satisfied. 2. Exhibit. Exhibit A is hereby made a part of this agreement; provided, however, that Section 1 of Exhibit A shall have no force and effect. 3. Operation Under Exhibit A. The parties shall operate pursuant to the terms of Exhibit A except as otherwise provided. The parties recognize Clallam County PUD (Utility) owns the interconnection facilities between the Project and the Government's Port Angeles Substation. Bonneville shall not be obligated to comply with Exhibit A if the Utility fails to perform its obligations as designated in Exhibit A. If the terms of this agreement are satisfactory, please indicate your acceptance by signing both enclosed copies and returning one copy to George Reich at the Puget Sound Area Office. Authenticated copies will then be sent to you for your records. ACCEPTED: CITY 0 T 1NGELES B y Ti tl e Mavor Date October 3. 1989 Enclosures (VS6- PMTT- 3256e) Sincerely, Walter E. Pollock Assistant Administrator for Power Sales Title City Clerk Date October 3, 1989 2 TRANSMISSION AGREEMENT executed by the UNITED STATES OF AMERICA DEPARTMENT OF ENERGY acting by and through the BONNEVILLE POWER ADMINISTRATION and CLALLAM COUNTY PUD and CITY OF PORT ANGELES MORSE CREEK HYDRO PROJECT Index to Sections F,HmRIT A Contract No. DE- MS79- 88BP92315 08/18/88 Section Page 1. Term of Agreement 3 2. Definition and Explanation of Terms 3 3. Exhibits; Interpretations 4 4. Transmission of Electric Power and Energy 4 5. Payment Provisions 6 6. Termination of Agreement and Charges 6 7. Revision of Exhibits 7 8. Reactive Power 9 9. Metering Equipment 9 10. Several Obligations 9 11. Execution in Counterpart 10 Section Page Exhibit A (Transmission Rate Schedules and General Transmission Rate Schedule Provisions) 4 Exhibit B (General Wheeling Provisions [GWP Form -4R]) 4 Exhibit C (Transmission Parameters) 4 Exhibit D (Project, Point of Interconnection, Point of Delivery) 4 Exhibit E (Loss Factors) 4 Exhibit F (Resource Services) 4 This TRANSMISSION AGREEMENT, executed 19,, by the UNITED STATES OF AMERICA (Government), Department of Energy, acting by and through the BONNEVILLE POWER ADMINISTRATION (Bonneville), CLALLAM COUNTY PUD (Utility), a Public Utility District of the State of Washington, and the CITY OF PORT ANGELES (CITY), a municipality of the State of Washington; W I T N E S S E T H: WHEREAS the Utility and the City have entered into, or intend to enter into, an agreement whereby the Utility will provide firm capacity in its transmission or distribution system facilities for the transmission of electric power generated at the Morse Creek Hydro Project (Project), and for interconnection of the Project to the facilities of the Utility (Interconnection Agreement); and WHEREAS the Utility and Bonneville have agreed to provide firm capacity on their transmission or distribution facilities for the transmission of power from the Project to the City; and WHEREAS the City owns the Project and the transmission service occurs over the Utility's and Bonneville's facilities for delivery to the City; and WHEREAS the load which is served hereunder at the Point of Interconnection 1 and the Point of Delivery is in the control area of Bonneville; and 2 WHEREAS Bonneville is authorized pursuant to law to dispose of electric power generated at various Federal hydroelectric projects in the Pacific Northwest, or acquired from other resources, to construct and operate transmission facilities, to provide transmission and other services, and to enter into agreements to carry out such authority; NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Term of Agreement. This agreement shall be effective commencing at 2400 hours on the date Bonneville has signed all original counterparts of this agreement (Effective Date), and unless terminated earlier pursuant to the terms of this Agreement, shall continue until 2400 hours on January 31, 2008. All obligations incurred hereunder shall continue until satisfied. Upon expiration of this agreement, Bonneville shall offer to extend transmission services provided hereunder, subject to the terms and conditions consistent with the then prevailing Bonneville rates, policy, and Federal Columbia River Transmission System (FCRTS) conditions. 2. Definition and Explanation of Terms. (a) "Electric Power" or "power" means electric peaking capacity, expressed in kilowatts, or electric energy expressed in kilowatthours, or both. (b) "Point of Delivery" means the point of delivery, described in Exhibit D, where electric power and energy are delivered to the City by Bonneville. (c) "Point of Interconnection" means the point described in Exhibit D where the project output will be made available by the Utility to Bonneville. (d) "Project" means the City's Morse Creek Hydro Project facility, described in Exhibit D, consisting of the site and generating units, and related transformation and transmission facilities. 3 (e) "Transmission Demand" means the amount specified in Exhibit C, expressed in kilowatts, which is the maximum hourly amount of electric energy to be made available to the City under this agreement at the Point of Delivery. (f) "Use -of- Facilities Charge" means the charge specified in Exhibit C, which is the monthly charge per kilowatt of Transmission Demand for the Point of Delivery; such charge has been calculated pursuant to the provisions of Exhibit A. 3. Exhibits; Interpretations. The rights and obligations of the parties with respect to provisions hereunder shall be subject to and governed by this agreement, including Exhibits A through F (Exhibits) attached hereto and by this reference made a part of this agreement. The provisions of section 38 of the General Wheeling Provisions [GWP Form -4R], Exhibit B, requires a minimum notice prior to a Rate Adjustment Date. If the rates are disapproved or conditions are placed on them by the agency authorized to approve Bonneville's transmission rates (Agency) or by any judicial interpretation of legislation by a court with jurisdiction over Bonneville, Bonneville shall not be required to give the minimum notice prior to resubmitting the rates to the Agency or implementing the Agency approved rates. The headings used in this agreement are for convenient reference only, and shall not affect the interpretation of this agreement. The City shall be the "Transferee" and the Utility and Bonneville shall be the "Transferor" referred to in the General Wheeling Provisions Exhibit. 4. Transmission of Electric Power and Energy. (a) Before power shall be made available to the City, all equipment and facilities needed for safe and reliable interconnection to Bonneville's facilities shall be installed by the City and in operation as approved by Bonneville. 4 If at any time during the term of this agreement the existence of Project generation creates disturbances on or otherwise degrades the integrity of the Federal Columbia River Transmission System (FCRTS), Bonneville may interrupt transmission services and require the City to install, or have installed at the City's expense, facilities necessary to correct such problems prior to resuming such services. In addition, Bonneville shall require use of its Revenue Metering System (RMS) meters in accordance with Section 9. (b) For each hour during the term hereof, the City shall make available or arrange to have made available to the Utility at the Utility's Morse Creek Point of Interconnection as defined in Exhibit D, and the Utility shall make available to Bonneville at the Government's Port Angeles Point of Interconnection as defined in Exhibit D, an amount of Electric Power metered at the Project less losses in accordance with Exhibit E. (c) For each hour during the term hereof, Bonneville shall make available to the City at the Point of Delivery for account of the City, the amount of Electric Power made available to Bonneville pursuant to subsection (b). (d) Bonneville shall add to the metered quantities monthly at the Point of Interconnection and subtract from the metered quantities monthly at the Point of Delivery the amount of power made available to Bonneville pursuant to subsection (b) above. (e) Nothing contained in the power sales contract between Bonneville and the Utility (Contract No. DE- MS79- 81BP90488 as amended by Amendatory Agreement No 1, dated June 3, 1982) and Bonneville and the City (Contract No. DE- MS79- 818P90450) shall limit in any way the obligations of Bonneville or the Utility to the City to provide the firm transmission services hereunder. 5 5. Payment Provisions. (a) The City shall pay Bonneville each month for the transmission services and the resource services provided hereunder, an amount which shall be the sum of the products obtained by multiplying each of the charges for such services by its respective multiplier. The charges and multipliers shall be as specified in Exhibit C. The resource services shall be developed and described pursuant to section 7(d). Bonneville shall make appropriate billing adjustments during periods, if any, when the operation of the Project is limited by governmental agencies having jurisdiction over air and water quality standards therefor. Any ratchet demand that may occur as determined by Bonneville pursuant to the Transmission Rate Schedules and General Transmission Rate Schedule Provisions, does not constitute an increase in any Transmission Demand approved by Bonneville, and any continued service at such level will depend on the availability of facilities as determined by Bonneville. (b) The City shall pay the Utility each month for the transmission services provided by the Utility hereunder as provided in the Interconnection Agreement. Such obligation is an obligation of the City. (c) To the extent that the billing determinants contained in Exhibit C include a demand factor, which may be represented by a "transmission demand," "contract demand," "measured demand" or other type of demand quantity, the billing demand and ratchet provisions, if any, of the General Transmission Rate Schedule Provisions contained in Exhibit A shall apply to the calculation of payments. 6. Termination of Agreement and Charges. This agreement may be terminated with mutual consent of the parties, which consent shall not be unreasonably withheld, (1) upon destruction or abandonment of the Project; 6 (2) upon discontinuation of Project output under a final order of a public official having authority to issue such order; (3) upon termination of the Interconnection Agreement between the City and the Utility for the transfer of power for the Project; (4) upon denial of a license to construct and operate the Project from the Federal Energy Regulatory Commission (FERC) or its successor agency (Agency). This agreement may not be terminated by reason of a partial reduction in generating capability. If this agreement is terminated earlier than the term described in section 1 above, or if there is a partial reduction in generating capability, the City shall pay Bonneville as follows: (a) for the unamortized nonsalvable investment plus the cost of removal of any facilities Bonneville has constructed at Government expense for the purpose of providing transmission service for the Project hereunder; or (b) monthly at a rate that shall compensate Bonneville for the annual cost of the facilities so constructed, to the extent such facilities become unusable in whole or in part as the result of such destruction or abandonment of the Project or upon such partial permanent reduction or discontinuation of Project Output. The payment obligations in this section shall be the obligation of the City. 7. Revision of Exhibits. (a) The Use -of- Facility Transmission rate schedule attached hereto as Exhibit A has been finally confirmed and approved by the Agency. The rate schedule in Exhibit A shall be replaced by successor rate schedules in accordance with the provisions of section 70) of the Pacific Northwest Power Act and Agency rules. The Use -of- Facilities Charge specified in Exhibit C shall be recalculated following any rate filing according to the provisions of 7 such amended, modified, or successor rate schedules and associated provisions, and Bonneville shall prepare a new Exhibit C incorporating the revised Use -of- Facilities Charge. (b) If Bonneville determines that the charges specified in Exhibit C or any subsequent charges specified in this agreement must be changed pursuant to sections 19 or 38 of Exhibit B, it shall prepare a new Exhibit C incorporating such changes. Such new Exhibit C shall be substituted for the Exhibit C then in effect and shall become effective as of the date specified therein. (c) The loss factor specified in Exhibit E may be revised from time to time upon notification by the City and Utility, or Bonneville's determination that conditions at the Project or on the Utility's system have changed sufficiently to warrant recalculating the loss factor. Bonneville shall calculate the new loss factor and submit to the City and Utility by letter pursuant to Exhibit E. (d) Exhibit F shall be revised to include charges for resource services which Bonneville provides for the Project or upon determination by Bonneville that any such resource service charge contained therein must be changed to properly compensate Bonneville for providing such services. The resource services may include, but shall not be limited to, such services as operating reserves and making available amounts of power and energy to the City, pursuant to section 4(c) above, which vary from the amounts of actual Project generation. The resource service charge set forth in Exhibit F shall not be increased more frequently than once during any consecutive 12 month period. Bonneville shall provide the City and Bonneville's other customers with a reasonable opportunity of not less than 90 days to comment prior to the effective date of such proposed revised charges. Revised charges shall take effect on the date specified by Bonneville in its written notice to the City of its intention to revise such charge. 8 8. Reactive Power. It is the intent of the parties hereto that the voltage level at the Points of Interconnection and the Points of Delivery be controlled in accordance with prudent utility operating practice. The parties hereto shall jointly plan and operate their systems so as not to place an undue burden on the other party to supply or absorb reactive power accompanying or resulting from deliveries hereunder. 9. Metering Equipment. Bonneville shall require use of a Revenue Metering System (RMS) unit or like unit meeting Bonneville's specifications to meter output from the Project. Bonneville shall perform all 0 &M services on the RMS unit. Likewise, the City shall use JEM meters, or equivalent, to determine output from the Project; and the City shall perform all O &M service on its meter. The cost associated with the purchase and maintenance of the RMS unit including repair or replacement shall be at the City's expense. The original purchase of the RMS unit is provided under Agreement No. DE- AI79- 87BP72149. Installation of telecommunications equipment for both Bonneville and City metering equipment and all service charges shall be at the City's expense. Ownership of the RMS equipment shall remain with the Government. 10. Several Obligations. Except where specifically stated in this agreement to be otherwise, the duties, obligations, and liabilities of the parties are intended to be several and not joint or collective. Nothing contained in this agreement shall ever be construed to create an association, trust, partnership, or joint venture or to impose a trust or partnership duty, obligation, or liability on or with regard to any party. Each party shall be individually and severally liable for its own obligation under this agreement. 9 11. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in several counterparts. CLALLAM COUNTY PUD ATTEST: By By Title Title Date Date 0= PORT ANGELES AT By L By Title Ma�rnr Date October 4, 1989 (VS6- PMT- 0758e) 10 UNITED STATES OF AMERICA Department of Energy Bonneville Power Administration By Date Title Date October 4. 1989 City Clark t GWP Form -4R (04- 15 -83) GENERAL WHEELING PROVISIONS Index to Sections Section Page GENERAL APPLICATION 1. Interpretation 2 2. Definitions 2 3. Prior Demands 4 4. Measurements 4 5. Measurements and Installation of Meters 5 6. Tests of Metering Installations 5 7. Adjustment for Inaccurate Metering 5 8. Character of Service 6 9. Point(s) of Delivery and Delivery Voltage 6 10. Combining Deliveries Coincidentally 6 11. Suspension of Deliveries 6 12. Continuity of Service 6 13. Uncontrollable Forces 7 14. Reducing Charges for Interruptions 7 15. Net Billing 7 16. Average Power Factor 7 17. Permits 8 18. Ownership of Facilities 8 19. Adjustment for Change of Conditions 8 20. Dispute Resolution and Arbitration 9 21. Contract Work Hours and Safety Standards 10 22. Convict Labor 11 23. Equal Employment Opportunity 11 24. Additional Provisions 12 25. Reports 12 26. Assignment of Contract 12 27. Waiver of Default 13 28. Notices and Computation of Time 13 29. Interest of Member of Congress 13 APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancing Phase Demands 13 31. Adjustment for Unbalanced Phase Demands 13 32. Changes in Requirements or Characteristics 13 33. Inspection of Facilities 13 34. Electric Disturbances 14 35. Harmonic Control 15 APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor 15 RELATING ONLY TO RURAL ELECTRIFICATION BORROWERS 37. Approval of Contract APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates 5 .zr PitILBIT s 15 15 1. Interpretation. GENERAL APPLICATION (a) The provisions in this exhibit shall be deemed to be a part of the contract body to which they are an exhibit. If a provision in such contract body is in conflict with a provision contained herein, the former shall prevail. (b) If a provision in the General Transmission Rate Schedule Provisions is in conflict with a provision in this exhibit or the contract body, this exhibit or the contract body shall prevail. (c) Nothing contained in this contract shall,, in any manner, be construed to abridge, limit, or deprive any party thereto of any means of enforcing any remedy, either at law or in equity, for the breach of any of the provisions thereof which it would otherwise have. 2. Definitions. As used in this contract: (a) "Contractor," "Utility" or "Borrower" means the party to this contract other than Bonneville. (b) "Federal System" or "Federal System Facilities" means the facilities of the Federal Columbia River Power System, which for the purposes of this contract shall be deemed to include the generating facilities of the Government in the Pacific Northwest for which Bonneville is designated as marketing agent; the facilities of the Government under the jurisdiction of Bonneville; and any other facilities: (1) from which Bonneville receives all or a portion of the generating capability (other than station service) for use in meeting Bonneville's loads, such facilities being included only to the extent Bonneville has the right to receive such capability; provided, however, that "Bonneville's loads" shall not include that portion of the loads of any Bonneville customer which are served by a; nonfederal generating resource purchased or owned directly by such customer which may be scheduled by Bonneville; (2) which Bonneville may use under contract, or license; or (3) to the extent of the rights acquired by Bonneville pursuant to the Treaty, between the Government and Canada, relating to the cooperative development of water resources of the Columbia River Basin, signed in Washington, D.C., on January 17, 1961. (c) "Integrated Demand" means the number of kilowatts which is equal to the number of kilowatt -hours delivered at any point during a clock hour. (d) "Measured Demand" means the maximum Integrated Demand for a billing month determined from measurements made as specified in the contract or as determined in section 4 hereof when metering or other data are not available 2 1 for such purpose. Bonneville, in determining the Measured Demand, will exclude any abnormal Integrated Demands due to, or resulting from (a) emergencies or breakdowns on, or maintenance of, either parties' facilities, and (b) emergencies on facilities of the Transferee, provided that such facilities have been adequately maintained and prudently operated as determined by Bonneville. If the contract provides for delivery of more than one class of power to a Transferee at any Point of Delivery, the portion of each Integrated Demand assigned to any class of power shall be determined as specified in the contract. The portion of the Integrated Demand so assigned shall constitute the Measured Demand for such class of power. (e) "Month" means the period commencing at the time when the meters mentioned in this contract are read by Bonneville and ending approximately 30 days thereafter when a subsequent reading of such meters is made by Bonneville. (f) "Point(s) of Delivery" means the point(s) of delivery listed either in the Points of Delivery Exhibit to this contract or in the body of this contract. (g) "System" or "Facilities" means the transmission facilities: (1) which are owned or controlled by either party, or (2) which either party may use under lease, easement, or license. (h) "Transferee" means an entity which receives power or energy from the system of the Transferor. (1) "Transferor" means an entity which receives at one point on its system a supplying entity's power or energy and makes such power or energy available at another point on its system for the account of the delivering entity or a third party. (0) "Uncontrollable Forces" means: (1) strikes or work stoppage affecting the operation of the Contractor's works, system, or other physical facilities or of the Federal System Facilities or the physical facilities of any Transferee upon which such operation is completely dependent; the term "strikes or work stoppage" shall be deemed to include threats of imminent strikes or work stoppage which reasonably require a party or Transferee to restrict or terminate its operations to prevent substantial loss or damage to its works, system, or other physical facilities; or (2) such of the following events as the Contractor or Bonneville or any Transferee by exercise of reasonable diligence and foresight, could not reasonably have been expected to avoid: (A) events, reasonably beyond the control of either party or any Transferee, causing failure, damage, or destruction of any works, system or facilities of such party or Transferee; the word "failure" 3 shall be deemed to include interruption of, or interference with, the actual operation of such works, system, or facilities; (B) floods or other conditions caused by nature which limit or prevent the operation of, or which constitute an imminent threat of damage to, any such works, system, or facilities; and (C) orders and temporary or permanent injunctions which prevent operation, in whole or in part, of the works, system, or facilities of either party or any Transferee, and which are issued in any bona fide proceeding by: i. any duly constituted court of general jurisdiction; or ii. any administrative agency or officer, other than Bonneville or its officers, provided by law (a) if said party or Transferee has no right to a review of the validity of such order by a court of competent jurisdiction; or (b) if such order is operative and effective unless suspended, set aside, or annulled by a court of competent jusidiction and such order is not suspended, set aside, or annulled in a judicial proceeding prosecuted by said party or Transferee in good faith; provided, however, that if such order is suspended, set aside, or annufTed in such a judicial proceeding, it shall be deemed to be an "uncontrollable force" for the period during which it is in effect; provided, further, that said party or Transferee, shall not be required to prosecute such a proceeding, in order to have the benefits of this section, if the parties agree that there is no valid basis for contesting the order. The term "operation" as used in this subsection shall be deemed to include construction, if construction is required to implement the contract and is specified therein. 3. Prior Demands. (a) In determining any credit demand mentioned in, or money compensation to be paid under this contract for any month, Integrated Demands at which electric energy was delivered by the Transferor at Points of Delivery mentioned herein for the account of the other party to this contract prior to the date upon which the contract takes effect shall be considered in the same manner as if this contract had been in effect. (b) If either party has delivered electric power and energy to the other party at any Point of Delivery specified in this contract or in any previous contract, and such Point of Delivery is superseded by another Point of Delivery specified in this contract, the Measured Demands, if any, at the superseded Point of Delivery shall be considered for the purpose of determining the charges paid to the Transferor for the electric power and energy delivered under this contract at such superseded point. 4. Measurements. Except as it is otherwise provided in section 7, each measurement of each meter mentioned in this contract shall be the measurement 4 automatically recorded by such meter or, at the request of either party, the measurement as mutually determined by the best available information. If it is provided in this contract that measurements made by any of the meters specified therein are to be adjusted for losses, such adjustments shall be made by using factors, or by compensating the meters, as agreed upon by the parties hereto. If changes in conditions occur which substantially affect any such loss factor or compensation, it will be changed in a manner which will conform to such change in conditions. 5. Measurements and Installation of Meters. Bonneville may at any time install a meter or metering equipment to make the measurements for any Point of Delivery required for any computation or determination mentioned in this contract, and if so installed, such measurements shall be used thereafter in such computation or determination. 6. Tests of Metering Installations. Each party to this contract shall, at its expense, test its metering installations associated with this contract at least once every two years, and, if requested to do so by the other party, shall make additional tests or inspections of such installations, the expense of which shall be paid by such other party unless such additional tests or inspections show the measurements of such installations to be inaccurate as specified in section 7. Each party shall give reasonable notice of the time when any such test or inspection is to be made to the other party who may have representatives present at such test or inspection. Any component of such installations found to be defective or inaccurate shall be adjusted, repaired or replaced to provide accurate metering. 7. Adjustment for Inaccurate Metering (a) If any meter mentioned in this contract fails to register, or if the measurement made by such meter during a test made as provided in section 6 varies by more than one percent from the measurement made by the standard meter used in such test, or if an error in meter reading occurs, adjustment shall be made correcting all measurements for the actual period during which such innacurate measurements were made, if such period can be determined. If such period cannot be determined, the adjustment shall be made for the period immediately preceding the test of such meter which is equal to the lesser of (a) one -half the time from the date of the last preceding test of such meter, or (b) six months. Such corrected measurements shall be used to recompute the amounts of any electric power and energy to be made available, or any credits to be made in any exchange energy account, and of any money compensation to be paid to the Transferor as provided in this contract. (b) If the credit theretofore made to the Transferor in the exchange energy account varies from the credit to be made as recomputed, the amount of the variance will be credited in such exchange energy account to the party entitled thereto. (c) If the money compensation theretofore paid to the Transferor varies from the money compensation to be paid as recomputed, the amount of the variance will be paid to the party entitled thereto after both parties have agreed to such recomputation and within 30 days after receipt of invoice by the designated payment office of the payer; provided, however, that the other 5 party may deduct such amount due it from any money compensation which thereafter becomes due the Transferor under this contract. 8. Character of Service. Unless otherwise specifically provided for in the contract, electric power and energy made available pursuant to this contract shall be in the form of three -phase current, alternating at a nominal frequency of 60 hertz. 9. Point(s) of Delivery and Delivery Voltage. Electric power and energy shall be delivered to each Transferee at such point or points and at such voltage or voltages as are agreed upon by the parties hereto. 10. Combining Deliveries Coincidentally. If; it is provided in this contract that charges for electric power and energy made available at two or more Points of Delivery will be made by combining deliveries at such points coincidentally: (a) the total Measured Demand to be considered in determining the billing demand for each billing month shall be the largest sum obtained by adding for each demand interval of such month the corresponding Integrated Demands of the Transferee at all such points after adjusting said Integrated Demands as appropriate to such points; (b) the number of kilowathours to be used in determining the energy charge, if any, and the average power factor at which electric energy is delivered at suc.h points under this contract, during such month, shall be the sum of the amounts of electric energy delivered at such points under this contract during such month; and (c) the number of reactive kilovolt- ampere -hours to be used in determining such average monthly power factor shall be the sum of the reactive kilovolt- ampere -hours delivered at such points under this contract such month. 11. Suspension of Deliveries. The other party to this contract may at any time notify the Transferor in writing to suspend the deliveries of electric power and energy provided for in this contract. Upon receipt of any such notice, the Transferor will forthwith discontinue, and will not resume, such deliveries until notified to do so by the other party, and upon receipt of such notice from the other party to do so, will forthwith resume such deliveries. 12. Continuity of Service. Either party may temporarily interrupt or reduce deliveries of electric power and energy if such party determines that such interruption or reduction is necessary or desirable in case of system emergencies, Uncontrollable Forces, or in order to install equipment in, make repairs to, make replacements within, make investigations and inspections of, or perform other maintenance work on its system. Except in case of emergency and in order that each party's operations will not be unreasonably interfered with, such party shall give notice to the other party of any such interruption or reduction, the reason therefor, and the probable duration thereof to the extent such party has knowledge thereof. Each party shall effect the use of temporary facilities or equipment to minimize the effect of any such interruption or outage to the extent reasonable or appropriate. 6 13. Uncontrollable Forces. Each party shall notify the other as soon as possible of any (incontrollable Forces which may in any way affect the delivery of power hereunder. In the event the operations of either party are interrupted or curtailed due to such Uncontrollable Forces, such party shall exercise due diligence to reinstate such operations with reasonable dispatch. 14. Reducing Charges for Interruptions. If deliveries of electric power and energy to the Transferee are suspended, interrupted, interfered with or curtailed due to Uncontrollable Forces on either the Transferee's System or Transferor's System, or if the Transferor interrupts or reduces deliveries to the Transferee for any of the reasons stated in section 12 hereof, the credit in the exchange energy account which would otherwise be made, or the money compensation which would otherwise be paid to the Transferor, shall be appropriately reduced. No interruption, or equivalent interruption, of less than 30 minutes duration will be considered for computation of such reduction in charges. 15. Net Billing. Upon mutual agreement of the parties, payment due one party may be offset against payments due the other party under all contracts between the parties hereto for the sale and exchange of electric power and energy, use of transmission facilities, operation and maintenance of electric facilities, lease of electric facilities, mutual supply of emergency and standby electric power and energy, and under such other contracts between such parties as the parties may agree, unless otherwise provided in existing contracts between the parties. Under contracts included in this procedure, all payments due one party in any month small be offset against payments due the other party in such month, and the resulting net balance shall be paid to the party in whose favor such balance exists unless the latter elects to have such balance carried forward to be added to the payments due it in a succeeding month. 16. Average Power Factor. (a) The formula for determining average power factor is as follows: Average Power Factor Kilowatthours /(Kilowatthours) (Reactive Kilovolt- ampere- hours) The data used in the above formula shall be obtained from meters which are ratcheted to prevent reverse registration. (b) When delivery of electric power and energy by the Transferor at any point is commingled with any other class or classes of power and it is impracticable to separately meter the kilowatthours and reactive kilovolt- ampere -hours for each class, the average power factor of the total delivery of such electric power and energy for the month will be used, where applicable, as the power factor for each of the separate classes. (c) Except as it is otherwise specifically provided in this contract, no adjustment will be made for power factor at any point of delivery described in this contract while the varhours delivered at such point are not measured. 7 (d) The Transferor may, but shall not be obligated to, deliver electric energy hereunder at a power factor of less than 0.85 leading or lagging. 17. Permits. (a) If any equipment or facilities associated with any Point of Delivery and belonging to a party to this contract are or are to be located on the property of the other party, a permit to install, test, maintain, inspect, replace, repair, and operate during the term of this contract and to remove such equipment and facilities at the expiration of said term, together with the right of entry to said property at all reasonable times in such term, is hereby granted by the other party. (b) Each party shall have the right at all reasonable times to enter the property of the other party for the purpose of reading any and all meters mentioned in this contract which are installed on such property. (c) If either party is required or permitted to install, test, maintain, inspect, replace, repair, remove, or operate equipment on the property of the other, the owner of such property shall furnish the other party with accurate drawings and wiring diagrams of associated equipment and facilities, or, if such drawings or diagrams are not available, shall furnish accurate information regarding such equipment or facilities. The owner of such property shall notify the other party of any subsequent modification which may affect the duties of the other party in regard to such equipment, and furnish the other party with accurate revised drawings, if possible. 18. Ownership of Facilities. (a) Except as otherwise expressly provided, ownership of any and all equipment, and of all salvable facilities installed or previously installed by a party to this contract on the property of the other party shall be and remain in the installing party. (b) Each party shall identify all movable equipment and all other salvable facilities which are installed by such party on the property of the other by permanently affixing thereto suitable markers plainly stating the name of the owner of the equipment and facilities so identified. Within a reasonable time subsequent to initial installation, and subsequent to any modification of such installation, representatives of the parties shall jointly prepare an itemized list of said movable equipment and facilities. 19. Adjustment for Change of Conditions. If changes in conditions hereafter occur which substantially affect any factor required by this contract to be used in determining (a) any credit in any exchange energy account to be made, money compensation to be paid, or amount of electric power and energy or losses to be made available to one party by the other party, or (b) any maximum replacement demand, or average power factor mentioned in this contract, such factor will be changed in an equitable manner which will conform to such changes of conditions. If an increase in the capacity of the facilities being used by the Transferor in making deliveries hereunder is required at any time after execution of this contract to enable the Transferor to make the deliveries herein required together with those required for its own operations, the construction or installation of additional or other 8 equipment or facilities for that purpose shall be deemed to be a change of conditions within the meaning of the preceding sentence. If, pursuant to the terms of the agreement establishing such exchange energy account, another rate is substituted for the rate to be used in settling the balance in such account, the number of kilowatthours to be credited to the Transferor in such account for each month as provided in this agreement, shall be changed for each month thereafter to the amount computed by multiplying such number of kilowatthours by 2.5 mills and dividing the resulting product by the currently effective substituted rate in mills per ki 1 owatthour. 20. Dispute Resolution and Arbitration. (a) Pending resolution of a disputed matter the parties will continue performance of their respective obligations pursuant to this contract. If the parties cannot reach timely mutual agreement on any matter in the administration of this contract Bonneville shall, unless otherwise specifically provided for in subsection (b) below and, to the extent necessary for its continued performance, make a determination of such matter without prejudice to the rights of the other party. Such determination shall not constitute a waiver of any other remedy belonging to the Contractor. (b) The questions of fact stated below shall be subject to arbitration. Other questions of fact under this contract may be submitted to arbitration upon written mutual agreement of the parties. The party calling for arbitration shall serve notice in writing upon the other party, setting forth in detail the question or questions to be arbitrated and the arbitrator appointed by such party. The other party shall, within 10 days after the receipt of such notice, appoint a second arbitrator, and the two so appointed shall choose and appoint a third. In case such other party fails to appoint an arbitrator within said 10 days, or in case the two so appointed fail for 10 days to agree upon and appoint a third, the party calling for the arbitration, upon 5 days' written notice delivered to the other party, shall apply to the person who at the time shall be the presiding judge of the United States Court of Appeals for the Ninth Circuit for appointment of the second and third arbitrator, as the case may be. The determination of the question or questions submitted for arbitration shall be made by a majority of the arbitrators and shall be binding on the parties. Each party shall pay for the services and expenses of the arbitrator appointed by or for it, for its own attorney fees, and for compensation for its witnesses or consultants. All other costs incurred in connection with the arbitration shall be shared equally by the parties thereto. The questions of fact to be determined as provided in this section shall be limited to: (1) the determination of the measurements to be made by the parties hereto pursuant to section 4; (2) the correction of the measurements to be made pursuant to section 7; 9 (3) the duration of the interruption or equivalent interruption in section 14; (4) whether changes in conditions mentioned in section 19 have occurred; (5) whether the changes mentioned in section 30 were made "promptly (6) whether an increase or decrease in load or change in load factor mentioned in section 32 is unusual; (7) any issue which both parties agree is an issue of fact mentioned in sections 30, 31, and 34; (8) the occurrence of an abnormal nonrecurring demand and the amount and time thereof; (9) whether a party has complied with section 34(b); and (10) the acceptable level of harmonics for purposes of section 35. 21. Contract Work Hours and Safety Standards. This contract, if and to the extent required by applicable law and if not otherwise exempted, is subject to the following provisions: (a) Overtime Requirements. No Contractor or subcontractor contracting for any part of contract Work which may require or involve the employment of laborers or mechanics, shall require or permit any laborer or mechanic in any workweek in which such worker is employed on such work to work in excess of 8 hours in any calendar day or in excess of 40 hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one -half times such worker's basic rate of pay for all hours worked in excess of eight hours in any calendar day or in excess of 40 hours in such workweek, as the case may be. (b) Violation; Liability for Unpaid Wages; Liquidated Damages. In the event of any violation of the provisions of subsection (a), the Contractor and any subcontractor responsible therefor shall be liable to any affected employee for such employee's unpaid wages. In addition, such contractor and subcontractor shall be liable to the Government for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic employed in violation of the provisions of subsection (a) in the sum of $10 for each calendar day on which such employee was required or permitted to be employed in such work in excess of eight hours or in excess of such employee's standard workweek of 40 hours without payment of the overtime wages required by subsection (a) above. (c) Withholding for Unpaid Wages and Liquidated Damages. Bonneville may withhold or cause to be withheld, from any moneys payable on account of work performed by the Contractor or subcontractor, such sums as may administratively be determined to be necessary to satisfy any liabilities of such Contractor or subcontractor for unpaid wages and liquidated damages as provided in subsection (b) above. 10 (d) Subcontracts. The Contractor shall insert in any subcontracts the clauses set forth in subsections (a) through (c) of this provision and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts which they may enter into, together with a clause requiring this insertion in any further subcontracts that may in turn be made. (e) Records. The Contractor shall maintain payroll records containing the information specified in 29 CFR 516.2(a). Such records shall be preserved for 3 years from the completion of the contract. 22. Convict Labor. In connection with the performance of work under this contract, the Contractor agrees, if and to the extent required by applicable law or if not otherwise exempted, not to employ any person undergoing sentence of imprisonment except as provided by Public Law 89 -176, September 10, 1965 (18 U.S.C. 4082(c)(2)) and Executive Order 11755, December 29, 1973. 23. Equal Employment Opportunity. During the performance of this contract, if and to the extent required by applicable law or if not otherwise exempted, the Contractor agrees as follows: (a) The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by Bonneville setting forth the provisions of the Equal Opportunity clause. (b) The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin. (c) The Contractor will send to each labor union or representative of workers with which said Contractor has a collective bargaining agreement or other contract or understanding, a notice, to be provided by Bonneville, advising the labor union or worker's representative of the Contractor's commitments under this Equal Opportunity clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment. (d) The Contractor will comply with all provisions of Executive Order No. 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. (e) The Contractor will furnish all information and reports required by Executive Order No. 11246 of September 24, 1965, and by the rules, regulations, and relevant orders of the Secretary of Labor, or pursuant 11 thereto, and will permit access to said Contractor's books, records, and accounts by Bonneville and the Secretary of Labor for purposes of investigations to ascertain compliance with such rules, regulations, and orders. (f) In the event of the Contractor's noncompliance with the Equal Opportunity clause of this contract or with any of such rules, regulations, or orders, this contract may be cancelled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order No. 11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order No. 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law. (g) The Contractor will include the provisions of paragraphs (a) through (f) in every subcontract or purchase order unless :exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order No. 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as Bonneville may direct as a means of enforcing such provisions, including sanctions for noncompliance. In the event the Contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by Bonneville, the Contractor may request the Government to enter into such litigation to protect the interests of the Government. 24. Additional Provisions. The Contractor agrees to comply with the clauses ror government contracts contained in the following statutes, Executive Orders, and regulations to the extent applicable: (a) the Rehabilitation Act of 1973, Public Law 93 -112, as amended, and 41 CFR 60 -741 (affirmative action for handicapped workers); (b) the Vietnam Era Veterans Readjustment Assistance Act of 1974, Public Law 92 -540, as amended, and 41 CFR 60 -250 (affirmative action for disabled veterans and veterans of the Vietnam era); (c) Executive Order 11625 and 41 CFR 1- 1.1310 -2 (utilization of minority business enterprises); (d) the Small Business Act, as amended. 25. Reports. The other party to this contract will furnish Bonneville such information as is necessary for making any computation required for the purposes of this contract, and the parties will cooperate in exchanging such additional information as may be reasonably useful for their respective operations. 26. Assignment of Contract. This contract shall inure to the benefit of, and shall be binding upon fne respective successors and assigns of the parties to this contract. Such contract or any interest therein shall not be transferred or assigned by either party to any party other than the Government or an agency thereof without the written consent of the other except as 12 specifically provided in this section. The consent of Bonneville is hereby given to any security assignment or other like financing instrument which may be required under terms of any mortgage, trust, security agreement or holder of such instrument of indebtedness made by and between the Contractor and any mortgagee, trustee, secured party, subsidiary of the Contractor or holder of such instrument of indebtedness, as security for bonds of other indebtedness of such Contractor, present or future; such mortagagee, trustee, secured party, subsidiary, or holder may realize upon such security in foreclosure or other suitable proceedings, and succeed to all right, title, and interests of such Contractor. 27. Waiver of Default. Any waiver at any time by any party to this contract of its rights with respect to any default of any other party thereto, or with respect to any other matter arising in connection with such contract, shall not be considered a waiver with respect to any subsequent default or matter. 28. Notices and Ccmputation of Time. Any notice required by this contract to be given to any party shall be effective when it is received by such party, and in computing any period of time from such notice, such period shall commence at 2400 hours on the date of receipt of such notice. 29. Interest of Member of Congress. No Member of, or Delegate to Congress, or Resident Commissioner shall be admitted to any share or part of this contract or to any benefit that may arise therefrom, but this provision shall not be construed to extend to this contract if made with a corporation for its general benefit. APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancing Phase Demands. If required by the Transferor at any time during the term of this contract, the Transferee shall promptly make such changes as are necessary on its system to balance the phase currents at any Point of Delivery so that the current of any one phase shall not exceed the current on any other phase at such point by more than 10 percent. 31. Adjustment for Unbalanced Phase Demands. If the Transferee fails to promptly make the changes mentioned in section 30, the Transferor may, after giving written notice one month in advance, determine that the Measured Demand of the Transferee at the Point of Delivery in question during each month thereafter, until such changes are made, is equal to the product obtained by multiplying by three the largest of the Integrated Demands on any phase adjusted as appropriate to such point during such month. 32. Changes in Requirements or Characteristics. The Transferee will, whenever possible, give reasonable notice to the Transferor of any unusual increase or decrease of its demands for electric power and energy on the Transferor's system, or of any unusual change in the load factor or power factor at which the Transferee will take delivery of electric power and energy under this contract. 33. Inspection of Facilities. Each party may for any reasonable purpose under this contract inspect the other party's electric installation at any reasonable time. Such inspection, or failure to inspect, shall not render 13 34. Electric Disturbances. such party, its officers, agents, or employees, liable or responsible for any injury, loss, damage, or accident resulting from defects in such electric installation, or for violation of this contract. The inspecting party shall observe written instructions and rules posted in facilities and such other necessary instructions or standards for inspection as the parties agree to. Only those electric installations used in complying with the terms of this contract shall be subject to inspection. (a) For the purposes of this section, an electric disturbance is any sudden, unexpected, changed, or abnormal electric, condition occurring in or on an electric system which causes damage. (b) Each party shall design, construct, operate, maintain and use its electric system in conformance with accepted utility practices: (1) to minimize electric disturbances such as, but not limited to, the abnormal flow of power which may damage or interfere with the electric system of the other party or any electric system connected with such other party's electric system; and (2) to minimize the effect on its electric system and on its customers of electric disturbances originating on its own or another electric system. (c) If both parties to this contract are parties to the Western Interconnected Electric System Agreement, their relationship with respect to system damages shall be governed by that Agreement. (d) During such time as a party to this contract is not a party to the Agreement Limiting Liability Among Western Interconnected Systems, its relations with the other party with respect to system damages shall be governed by the following sentence, notwithstanding the fact that the other party may be a party to said Agreement Limiting Liability Among Western Interconnected Systems. A party to this contract shall not be liable to the other party for damage to the other party's system or facilities caused by an electric disturbance on the first party's system, whether or not such electric disturbance is the result of negligence by the first party, if the other party has failed to fulfill its obligations under subsection (b)(2) above. (e) If one of the parties to this contract is not a party to the Agreement Limiting Liability Among Western Interconnected Systems, each party to this contract shall hold harmless and indemnify the other party, its officers and employees, from any claims for loss„ injury, or damage suffered by those to whom the first party delivers power not for resale, which loss, injury or damage is caused by an electric disturbance on the other party's system, whether or not such electric disturbance results from the negligence of such other party if such first party has failed to fulfill its obligations under subsection (b)(2) above, and such failure contributed to the loss, injury or damage. 14 (f) Nothing in this section shall be construed to create any duty to, any standard of care with reference to, or any liability to any person not a party to this contract. 35. Harmonic Control. Each party shall design, construct, operate, maintain and use its electric facilities in accordance with good engineering practices to reduce to acceptable levels the harmonic currents and voltages which pass into the other party's facilities. Harmonic reductions shall be accomplished with equipment which is specifically designed and permanently operated and maintained as an integral part of the facilities of the party which owns the system on which harmonics are generated. APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor. Protection is or will be afforded to Bonneville or its Transferor under such of the following provisions and conditions as are specified in each contract executed or to be executed by Bonneville and each third party Transferee named in this contract: the power factor clause of the applicable Bonneville Wholesale Rate Schedule and the subject matter set forth in the General Contract Provisions under the following titles, namely: Adjustment for Unbalanced Phase Demands; Uncontrollable Forces; Continuity of Service; Changes in Demands or Characteristics; Electric Disturbances; Harmonic Control; Balancing Phase Demands; Permits; Ownership of Facilities; and Inspection of Facilities. RELATING TO RURAL ELECTRIFICATION ADMINISTRATION BORROWERS 37. Approval of Contract. If the Contractor borrows from the Rural Electrification Administration or any other entity under an indenture which requires the lender's approval of contracts, this contract and any amendment thereto shall not be binding on the parties thereto if they are not approved by the Rural Electrification Administration or such other entity. The Contractor shall notify Bonneville of any such entity. If approval is given, such contract or amendment shall be effective at the time stated therein. APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates. (a) Bonneville shall establish, periodically review and revise rates for the wheeling of electric power and /or energy pursuant to the terms of this contract. Such rates shall be established in accordance with applicable law. (b) As used in this section, the words "Rate Adjustment Date" shall mean any date specified by Bonneville in a notice of intent to file revised rates as published in the Federal Register; provided, however, that such date shall not occur sooner than (1) nine months trom tie date that such notice of intent is published; or (2) twelve months from any previous Rate Adjustment Date. By giving written notice to the Contractor 45 days prior to such Rate Adjustment Date, Bonneville may delay such Rate Adjustment Date for up to 90 days if Bonneville determines either that the revenue level of the proposed rates 15 differs by more than five percent from the revenue requirements indicated by most recent repayment studies entered in the hearings record or that external events beyond Bonneville's control will prevent Bonneville from meeting such Rate Adjustment Date. Bonneville may cancel a notice of intent to file revised rates at any time (1) by written notice to the Contractor; or (2) by publishing in the Federal Register a new notice of intent to file revised rates which specifically cancels a previous notice. (c) The Contractor shall pay Bonneville for the service made available under this contract during the period commencing on each Rate Adjustment Date and ending at the beginning of the next Rate Adjustment Date at the rate specified in any rate schedule available at the beginning of such period for service of the class, quality, and type provided for in this contract, and in accordance with the terms thereof, and of the General Transmission Rate Schedule Provisions, if any, as changed with, incorporated in or referred to in such rate schedule. New rates shall not be effective on any Rate Adjustment Date unless they have been approved on a final or interim basis by a governmental agency designated by law to approve Bonneville's rates. Rates shall be applied in accordance with the terms thereof, the General Transmission Rate Schedule Provisions as changed with, incorporated in or referred to in such rate schedule and the terms of this contract. (WP-PKJ-0222f) 16 Government' Port Angeles Substation 69 kV Bay 26 Approved Point of Delivery Government's Port Angeles Substation 69 kV Bay 23 (VS6- PMT- 0758e) Transmission Parameters Revision No. 1 Exhibit C, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1989 A. Points of Interconnection, Points of Delivery, Transmission Demands, Use -of- Facilities Charges, and Resources. Approved Point Use -of- Resource(s) of Interconnection Transmission Facilities to be (Voltage) Demand Charge Integrated 485 kW $.070 /kW -mo 1/ Morse Creek 1/ Composite UFT charge based on Bay's 23 and 26. B. Calculation of Charaes Pursuant to the UFT -83 Rate Schedule: Facility Government's Port Angeles Substation 69 kV Bay 26 Bay 23 $152,752 I &A 2/ I &A 0 &M 1/ Sum of Annual Annual Annual Non Coincidental (Sponsor) Investment Cost Ratio Cost Cost Demand /kW /yr. Demand 6/ $160,631 9.06% $14,553 5,889 35,685 kW 1/ 0.573 485 kW Total UFT Charge $0.844 /kW -yr. 5/ $0.070 /kW -mo. 1/ 0 &M charge based on low voltage terminal in 3 -7 -89 0 &M cost tables. 2/ Taken from 5 -1 -89 ACR table, column (8) minus column (5), Type S5 Substation. 2/ J90 peak loads from Clallam Eastern (35,200 kW) plus Morse Creek (485 kW). 4/ J90 peak loads from Port Angeles City No. 1 (61.89 of Port Angeles City Nos. 1 and 2) plus Morse Creek (485 kW) plus Clallam Eastern (35,200 kW). (61.89% X 59,800) 485 35,200 72,695 kW. 5/ Unit Charge (I &A Annual Cost) 0 &M Annual Cost /kW yr. Sum of Non Coincidental Demands Monthly Charge i$ /kW yr) (Sponsor Demand)_ /mo. 12 months 5/ Ratchets shall be handled in accordance with section 5(c). (VS6- PMT- 0758e) Revision No. 1 Exhibit C, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1989 9.06% $13,839 5,889 72 kW 4/ 0.271 485 kW (VS6- PMT- 0758e) 1. MORSE CREEK HYDRO PROJECT Exhibit D, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement Description of Project, Point of Interconnection, and Points of Delivery Location: the project is located in the NW 1/4 of Section 29, T3ON, R5W, Willamette Meridian, Clallam County, Washington; approximately 3 miles east of Port Angeles and 1 -1/2 to 2 miles south of state route 101 and primarily east of Glass Road; Demand: 485 kW; Voltage: 12.5 kV; Metering: in the City's powerhouse, in the 480 volt circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for transformation losses between the Project point of metering and the high side of the Project transformer. 2. MORSE CREEK POINT OF INTERCONNECTION Location: A point on the Utility's distribution line approximately one half mile from the Morse Creek Hydro Project at the junction of Glass and Boyd Roads where the distribution lines of the Utility and the line from the City's Project interconnect; Voltage: 12.5 kV; Adjustments: there shall be an adjustment for transmission losses between the Morse Creek Hydro Project and the Morse Creek Point of Interconnection. 3. PORT ANGELES POINT OF INTERCONNECTION Location: the point in Bay 26 (Clallam Co. PUD's Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the Utility and the Government are connected; Voltages: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for distribution losses between the Utility's Morse Creek Point of Interconnection and the Government's Port Angeles Point of Interconnection. 4. PORT ANGELES POINT OF DELIVERY Exhibit D, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement Location: the point in Bay 23 (Port Angeles Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the City and the Government are connected; Voltages: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be no adjustment for losses between the Point of Interconnection and the Point of Delivery. (VS6- PMT- 0758e) (VS6- PMT- 0758e) Loss Factors Exhibit E, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement The losses specified in Exhibit D under Points of Interconnection and Points of Delivery shall consist of two components. The first is the transformation and transmission losses from the Project to the Morse Creek Point of Interconnection, and the second is the transmission and transformation losses from the Morse Creek Point of Interconnection to the Port Angeles Point of Interconnection. No losses shall be applied between'the Port Angeles Point of Interconnection and the Port Angeles Point of Delivery as specified in Exhibit D. The losses between the Project Point of Metering and the Port Angeles Point of Interconnection shall be submitted to the City and the Utility by Bonneville by separate letter. The revision of these losses shall be as specified in section 7(c). (VS6- PMT- 0758e) Resource Services Exhibit F, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Effective at 2400 hours on the Effective Date of this Agreement Resource service charges shall be incorporated into Exhibit F as developed by Bonneville according to section 7(d) of this agreement. As of the Effective Date of this Agreement, the Resource service charge is zero. 1987 Transmission Rate Schedules and General Transmission Rate Schedule Provisions Bonneville POWER ADMINISTRATION United States Department of Energy Bonneville Power Administration 905 NE. 11th Avenue Portland, Oregon 97232 Bonneville Power Administration's 1987 Transmission Rate Schedules and General Transmis- sion Rate Schedule Provisions, were approved on an interim basis by the Federal Energy Regulatory Commission, United States Department of Energy, in a commission order issued September 23, 1987, (Docket Nos. EF87- 2021 -000, et al.). These rate schedules and provisions became effective October 1,1987. These rate schedules and provisions supersede the Adminis- tration's Transmission Rate Schedules and General Transmission Rate Schedule Provisions effective July 1,1985. Existing rate schedules UFT -2, UFT -83, and TGT -1, for which final approval has been extended, are also included in this brochure. TRANSMISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS Current Transmission Rate Schedules FPT -87.1 Formula Power Transmission Integration of Resources 3 Southern Intertie Transmission 4 Northern Intertie Transmission 5 Eastern Intertie Transmission 6 Energy Transmission 7 Market Transmission 8 Extension of Existing Transmission Rate Schedules 9 UFT -2 10 UFT -83 11 TGT -1 12 FPT -87.3 1R -87 IS -87 IN -87 IE -87 ET -87 MT -87 General Transmission Rate Schedule Provisions SECTION 1 SECTION II SECTION I11 SECTION IV TABLE OF CONTENTS Page 1 Formula Power Transmission 2 Adoption of Revised Transmission Rate Schedules and General Transmission Rate Schedule Provisions 14 Billing Factor Definitions and Billing Adjustments 14 Other Definitions 15 Billing Information 16 SECTION 1. AVAILABILITY This schedule supersedes schedule FPT -85.1 for all firm transmission agreements which provide that rates may be adjusted not more frequently than once a year. It is available for firm transmission of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This sche- dule is for full -year and partial -year service and for either continuous or intermittent service when firm availability of service is required. For facilities at voltages lower than the Secondary System, a differ- ent rate schedule may be specified. Service under this schedule is subject to BPA's General Transmis- sion Rate Schedule Provisions. SECTION I1. RATE A. Full-Year Service The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the Main Grid Charge, the Secondary System Charge, and Intertie Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component factors as specified in the Agreement: a. Main Grid Distance Factor: The amount computed by multiplying the Main Grid Distance by $0.0250 per mile; b. Main Grid Interconnection Terminal Fac- tor: $0.20; c. Main Grid Terminal Factor: $0.25; d. Main Grid Miscellaneous Facilities Factor: $1.04; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following compo- nent factors as specified in the Agreement: a. Secondary System Distance Factor: The amount determined by multiplying the Secondary System Distance by $0.1255 per mile; TRANSMISSION RATE SCHEDULES SCHEDULE FPT -87.1 FORMULA POWER TRANSMISSION 1 b. Secondary System Transformation Factor: $1.95; c. Secondary System Intermediate Terminal Factor: $0.72; d. Secondary System Interconnection Termi- nal Factor: $0.36; 3. Intertie Charge For use of the Southern Intertie facilities: $5.21. B. Partial -Year Service The monthly charge per kilowatt of billing demand shall be as specified in Section I I.A for all months of the year except for agreements whose term is 5 years or less and which specify service for fewer than 12 months per year, the monthly charge shall be: 1. during months for which service is specified, the monthly charge defined in Section II.A, and 2. during other months, the monthly charge defined in Section II.A multiplied by 0.2. SECTION 1I1. BILLING FACTORS Unless otherwise stated in the Agreement, the bill- ing demand shall be the largest of: A. the Transmission Demand; B. the highest hourly Scheduled Demand for the month; or C. the Ratchet Demand. SECTION I. AVAILABILITY This schedule supersedes schedule FPT -83.3 for all firm transmission agreements which provide that rates may be adjusted not more frequently than once every 3 years. It is available for firm transmis- sion of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This schedule is for full -year and partial -year service and for either continuous or intermittent service when firm availability of service is required. For facilities at voltages lower than the Secondary System, a dif- ferent rate schedule may be specified. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION I1. RATE A. Full -Year Service The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the Main Grid Charge, the Secondary System Charge, and Intertie Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component factors as specified in the Agreement: a. Main Grid Distance Factor: The amount computed by multiplying the Main Grid Distance by $0.0250 per mile; b. Main Grid Interconnection Terminal Fac- tor: $0.20; c. Main Grid Terminal Factor: $0.25; d. Main Grid Miscellaneous Facilities Factor: $1.04; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following compo- nent factors as specified in the Agreement: a. Secondary System Distance Factor: The amount determined by multiplying the Secondary System Distance by $0.1255 per mile; b. Secondary System Transformation Factor: $1.95; SCHEDULE FPT -87.3 FORMULA POWER TRANSMISSION 2 c. Secondary System Intermediate Terminal Factor: $0.72; d. Secondary System Interconnection Termi- nal Factor: $0.36; 3. Intertie Charge For use of the Southern Intertie facilities: $5.21. B. Partial -Year Service The monthly charge per kilowatt of billing demand shall be as specified in Section II.A for all months of the year except for agreements whose term is 5 years or Tess and which specify service for fewer than 12 months per year, the charge shall be: 1. during months for which service is specified, the monthly charge defined in Section II.A, and 2. during other months, the monthly charge defined in Section II.A multiplied by 0.2. SECTION III. BILLING FACTORS Unless otherwise stated in the Agreement, the bill- ing demand shall be the largest of: A. the Transmission Demand; B. the highest hourly Scheduled Demand for the month; or C. the Ratchet Demand. SECTION I. AVAILABILITY This schedule supersedes IR -85 and is available for firm transmission service for electric power and energy using the Main Grid and /or Secondary Sys- tem of the FCRTS. The definitions of Main Grid and Secondary Systems are the same as for the FPT -87.1 and FPT -87.3 rate schedules and are contained in the General Transmission Rate Schedule Provisions. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The monthly charge shall be the sum of A and B where: A. The Demand Charge shall be: 1. $0.2600 per kilowatt of billing demand; or 2. for Points of Integration (P01) specified in the Agreement as being short distance POI's, for which Main Grid and Secondary System facil- ities are used for a distance of less than 75 circuit miles, the following formula applies: [0.2 (0.8/75 x transmission distance)] ($0.2600 per kilowatt of billing demand) Where: the billing demand for a short distance POI is the demand level specified in the Agreement for such POI, and the transmission distance is the circuit miles between the POI for a generating resource of the customer and a designated Point of Delivery (POD) serving the load of the customer. Short distance POI's are determined by BPA after consider- ing factors in addition to transmission distance. B. The Energy Charge shall be: 0.85 mills /kWh of billing energy. SECTION I11. BILLING FACTORS To the extent that the Agreement provides for the customer to be billed for transmission in excess of the Transmission Demand or Total Transmission Demand, as defined in the Agreement, at the non- SCHEDULE IR -87 INTEGRATION OF RESOURCES 3 firm transmission rate (currently ET -87), such transmission service shall not contribute to either the Billing Demand or the Billing Energy for the IR rate provided that the customer requests such treatment and BPA approves in accordance with the prescribed provisions in the Agreement. A. Billing Demand The billing demand shall be the largest of: 1. the Transmission Demand, except under General Transmission Agreements where a Total Transmission Demand is defined; 2. the highest hourly Scheduled Demand for the month; or 3. the Ratchet Demand. B. Billing Energy The billing energy shall be the monthly sum of scheduled kilowatthours. SECTION 1. AVAILABILITY This schedule supersedes IS -85 and is available for all transmission on the Southern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE A. Nonfirm Rate The charge for nonfirm transmission of non BPA power shall be 1.4 mills /kWh of billing energy. This charge applies for both north -to- south and south -to -north transactions. B. Firm Power Transmission Rate The charge for firm transmission service granted access by BPA shall be $0.360 per kW per month of billing demand and 0.69 mills /kWh of billing energy. Firm transmission will only be made available to customers under this rate schedule who have executed a contract with BPA specifying use of the Firm Power Transmission rate for either north -to -south or south -to -north transactions. SECTION 11I. BILLING FACTORS A. For services under Section II.A, the billing energy shall be the monthly sum of the sche- duled kilowatthours, plus the monthly sum of kilowatthours allocated but not scheduled. The amount of allocated but not scheduled energy that is subject to billing may be reduced prorata by BPA due to forced Intertie outages, and other uncontrollable forces that may reduce Intertie capacity. The amount of allocated but not sche- duled energy that is subject to billing also may be reduced upon mutual agreement between BPA and the customer. B. For services under Section II.B, the billing demand shall be the Transmission Demand as defined in the Agreement. The billing energy shall be the monthly sum of scheduled kilowat- thours, unless otherwise specified in the Agreement. SCHEDULE IS -87 SOUTHERN INTERTIE TRANSMISSION SECTION 1. AVAILABILITY This schedule supersedes IN -85 and is available for all transmission on the Northern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE The charge for transmission of non -BPA power on the Northern Intertie shall be 1.05 mills /kWh. SECTION I11. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. SCHEDULE IN -87 NORTHERN INTERTIE TRANSMISSION J u SECTION I. AVAILABILITY This schedule supersedes IE -85 and is available for all nonfirm transmission on the Eastern Intertie. Serv- ice under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE The charge for transmission of nonfirm energy on the Eastern Intertie shall be 2.08 mills /kWh. SECTION 111. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. SCHEDULE 1E -87 EASTERN INTERTIE TRANSMISSION 6 1 SECTION I. AVAILABILITY This schedule supersedes ET -85, unless otherwise specified in the Agreement, with respect to delivery using FCRTS facilities other than the Southern Intertie, Eastern Intertie, or the Northern Intertie, and is available for nonfirm transmission between points within the Pacific Northwest. BPA may inter- rupt service which is provided under this rate sche- dule. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for such nonfirm transmission of non Federal electric energy shall be 1.61 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of scheduled kilowatthours. SCHEDULE ET -87 ENERGY TRANSMISSION 7 F SECTION I. AVAILABILITY This schedule is available for Transmission Service for transactions using FCRTS facilities pursuant to the Western Systems Power Pool (WSPP) Agree- ment. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION I1. RATE The charge shall be determined in advance by BPA. The charge shall not exceed 33 percent of the dif- ference between the highest Decremental Cost of generation of the WSPP and the lowest Decremen- tal Cost of generation of the WSPP as determined by the WSPP Operating Committee during the year prior to the effective date of the WSPP Agreement. The Operating Committee may determine that a subsequent redetermination is necessary based upon the immediately preceeding years expe- rience. However, the transmission charge shall not be less than 1 mill per kilowatthour. SECTION III. BILLING FACTORS The billing factors shall be specified in advance by BPA, as to representing the Transmission Service use or reservation. SCHEDULE MT -87 MARKET TRANSMISSION 8 Extension of Existing Transmission Rate Schedules UFT -2 The Bonneville Power Administration received extension of final approval for the UFT -2 wheeling rate from the Federal Energy Regulatory Commission, United States Department of Energy, in a commission order issued September 23, 1987, (Docket Nos. EF87- 2021 -000, et al.). This rate schedule is in effect through June 30, 1990. UFT 83 and TGT 1 The Bonneville Power Administration received extension of final approval for wheel- ing rate schedules UFT -83 and TGT -1, from the Federal Energy Regulatory Commis- sion, United States Department of Energy, in a commission order issued April 29,1987, (Docket Nos. EF85- 2021 -001, et al.). These rate schedules are in effect through June 30, 1990. 9 SECTION I. AVAILABILITY This schedule is available for the firm transmission of electric power and energy over specified FCRTS facilities installed or operated primarily for the benefit or convenience of a limited number of cus- tomers. This schedule is not appropriate for new agreements for service over the integrated Net- work Segment, or the PNW -PSW Intertie Segment. SECTION II. RATE The monthly charge per kilowatt of Transmission Demand specified in the Agreement shall be one twelfth of the Annual Cost per kilowatt of Capacity of the specified facilities. Such Annual Cost shall be determined in accordance with Section 111. SECTION III. DETERMINATION OF TRANSMISSION RATE A. From time to time, but not more often than once in each Contract Year, BPA shall determine the following data for the facilities which have been constructed or otherwise acquired by BPA and are used to transmit electric power and energy thereunder: 1. Capital cost of each such facility as specified in the most recently published plant invest- ment records of BPA which are issued in sup- port of the Federal Columbia River Power System financial statement. 2. Annual Interest and Amortization Ratios for each such facility using the most recent sys- tem average cost factors developed from actual Interest and Amortization costs for specific categories of FCRTS facilities and from data included in the financial statement. 3. Operation, maintenance, administrative and general, and general plant costs of such facili- ties using the most recent system average costs for specific categories of FCRTS facilities. 4. The yearly noncoincidental peak demands of all users of such facilities. B. The monthly charge per kilowatt of Transmis- sion Demand shall be one twelfth of the sum of the Annual Cost per kilowatt of each of the SCHEDULE UFT -2 USE -OF- FACILITIES TRANSMISSION 10 FCRTS facilities used. The Annual Cost per kilowatt of each facility constructed or other- wise acquired by BPA shall be determined in accordance with the following formula: (I X R) B D Where B Operation, maintenance, adminis- trative and general, and general plant cost of such facility as determined in A.3. Capital cost of such facility as determined it A.1. R Annual Interest and Amortization Ratio foi such facility as determined in A.2. D The sum of the yearly noncoincidenta demands on the facility as determined in A.4. The Annual Cost per kilowatt of facilities listec in the Agreement which are owned by another entity, and used by BPA for making deliveries tc the Transferee, shall be determined from the costs specified in the Agreement between BP? and such other entity. SECTION IV. DETERMINATION OF TRANSMISSION DEMAND Unless otherwise stated in the Agreement, the fac• tor to be used in determining the kilowatts o Transmission Demand is the largest of: A. the Transmission Demand specified in the Agreement; B. the highest Measured or Scheduled Demanc for the month, the Measured Demand being adjusted for power factor; or C. the Ratchet Demand. r l SECTION I. AVAILABILITY This schedule supersedes UFT -1, and UFT -2, unless otherwise provided in the Agreement, and is avail- able for firm transmission over specified FCRTS facilities. SECTION I1. RATE The monthly charge per kilowatt of Transmission Demand specified in the Agreement shall be one twelfth of the annual cost of capacity of the speci- fied facilities divided by the sum of Transmission Demands (in kilowatts) using such facilities. Such annual cost shall be determined in accordance with Section 111. SECTION 111. DETERMINATION OF TRANSMISSION RATE A. From time to time, but not more often than once in each Contract Year, BPA shall determine the following data for the facilities which have been constructed or otherwise acquired by BPA, and which are used to transmit electric power and energy: 1. The annual cost of the specified FCRTS facili- ties, as determined from the capital cost of such facilities and annual cost ratios deve- loped from the FCRTS financial statement, including interest and amortization, opera- tion and maintenance, administrative and general, and general plant costs. 2. The yearly noncoincident peak demands of all users of such facilities or other reasonable measurement of the facilities' peak use. B. The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the annual cost of the FCRTS facilities used divided by the sum of Transmission Demands. The annual cost per kilowatt of Transmission Demand for a facility constructed or otherwise acquired by BPA shall be determined in accor- dance with the following formula: A D where: A The annual cost of such facility as deter- mined in accordance with A.1. above. SCHEDULE UFT -83 USE -OF- FACILITIES TRANSMISSION D The sum of the yearly noncoinc demands on the facility as determined in a dance with A.2. above. The annual cost per kilowatt of facilities listed i Agreement which are owned by another entity used by BPA for making deliveries to the transf shall be determined from the costs specified i Agreement between BPA and such other enti SECTION IV. DETERMINATION OF BILLII DEMAND Unless otherwise stated in the Agreement, th+ tor to be used in determining the kilowatts of b demand shall be the largest of: A. the Transmission Demand in kilowatts spec in the Agreement; B. the highest hourly Measured or Schec Demand for the month, the Measured Der being adjusted for power factor; or C. The Ratchet Demand. SECTION I. AVAILABILITY This schedule shall apply to all agreements which provide for the firm transmission of electric power and energy over transmission facilities of BPA's sec- tion of the Montana [Eastern] Intertie. SCHEDULE TGT -1 TOWNSEND- GARRISON TRANSMISSION SECTION II. RATE The monthly charge shall be one twelfth of the sum of the annual charges listed below, as applicable and as specified in the agreements for firm trans- mission. The Townsend Garrison 500 -kV lines and associated terminal, line compensation, and com- munication facilities are a separately identified por- tion of the Federal Transmission System. Annual revenues plus credits for Government use should equal annual costs of the facilities, but in any given year there may be either a surplus or a deficit. Such surpluses or deficits for any year shall be accounted for in the computation of annual costs for succeed- ing years. Revenue requirements from firm trans- mission use will be decreased by any revenues received from nonfirm use and credits for all Government use. The general methodology for determining the firm rate is to divide the revenue requirement by the total firm capacity require- ments. Therefore, the higher the total capacity requirements, the lower will be the unit rate. If the Government provides firm transmission serv- ice in its section of the Montana [Eastern] Intertie in exchange for firm transmission service in a custo- mer's section of the Montana Intertie, the payment by the Government for such transmission services provided by such customer will be made in the form of a credit in the calculation of the Intertie Charge for such customer. During an estimated 1 to 3 -year period following the commercial opera- tion date oft the third generating unit at the Colstrip Thermal Generating Plant at Colstrip, Montana, the capability of the Federal Transmission System west of Garrison Substation may be different from the long -term situation. It may not be possible to com- plete the extension of the 500 -kV portion of the Federal Transmission System to Garrison by such commercial operation date. In such event, the 500/230 kV transformer will be an essential exten- sion of the Townsend- Garrison Intertie facilities, and the annual costs of such transformer will be included in the calculation of the Intertie Charge. 12 However, starting 1 month after extension to Garri- son of the 500 -kV portion of the Federal Transmis- sion System, the annual costs of such transformer will no longer be included in the calculation of the Intertie Charge. A. Nonfirm Transmission Charge: This charge will be filed as a separate Rate Sche- dule and revenues received thereunder will reduce the amount of revenue to be collected under the Intertie Charge below. B. Intertie Charge for Firm Transmission Service: Intertie Charge [(TAC /12 -NFR) x (CR -EC) TC R SECTION I11. DEFINITIONS A. TAC Total Annual Costs of facilities associated with the Townsend Garrison 500 -kV Transmis- sion line including terminals, and prior to extension of the 500 -kV portion of the Federal Transmission System to Garrison, the 500/230 kV transformer at Garrison. Such annual costs are the total of (1) interest and amortization of asso- ciated Federal investment and the appropriate allocation of general plant costs; (2) operation and maintenance costs; (3) allowance for Bonne ville's general administrative costs which are appropriately allocable to such facilities; and (4) payments made pursuant to section 7(m) of Public Law 96 -501 with respect to these facilities. Total Annual Costs shall be adjusted to reflect reductions to unpaid total costs as a result of any amounts received, under agreements for firm transmission service over the Montana Intertie, by the Government on account of any reduc- tion in Transmission Demand, termination or partial termination of any such agreement or otherwise to compensate BPA for the unamor- tized investment, annual cost, removal, salvage, or other cost related to such facilities. B. NFR Nonfirm Revenues, which are equal to (1) the product of the Nonfirm Transmission Charge described in II(A) above, and the total nonfirm energy transmitted over the Townsend Garrison line segment under such charge for such month; plus (2) the product of the Non -Firm Transmission Charge and the total nonfirm energy transmitted in either direction by the Government over the Townsend Garrison line segment for such month. C. CR Capacity Requirement of a customer on the Townsend- Garrison 500 -kV transmission facilities as specified in its firm transmission agreement. D. TCR Total Capacity Requirement on the Townsend Garrison 500 -kV transmission facili- ties as calculated by adding (1) the sum of all Capacity Requirements (CR) specified in trans- mission agreements described in section I; and (2) the Government's firm capacity require- ment. The Government's firm capacity requirement shall be no less than the total of the amounts, if any, specified in firm transmission agreements for use of the Montana Intertie. E. EC Exchange credit for each customer which is the product of (1) the ratio of investment in the Townsend Broadview 500 -kV transmission line to the investment in the Townsend Garrison 500 -kV transmission line; and (2) the capacity which the Government obtains in the Townsend Broadview 500 -kV transmission line through exchange with such customer. If no exchange is in effect with a customer, the value of EC for such customer shall be zero. 13 GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS SECTION I. ADOPTION OF REVISED TRANSMISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS A. Approval of Rates These rate schedules and General Transmission Rate Schedule Provisions (GTRSP) shall become effective upon approval by the Federal Energy Regulatory Commission. BPA will request FERC approval effective October 1, 1987. BPA is requesting that all proposed Transmission Rate Schedules be effective for a period of 2 years, from October 1, 1987, through September 30, 1989, with the exception of the FPT 87.3 rate schedule, which is effective for a period of 3 years, through September 30, 1990. B. General Provisions These 1987 Transmission Rate Schedules and associated GTRSP supersede in their entirety BPA's 1985 Transmission Rate Schedules and GTRSP (which became effective July 1,1985) but do not supersede prior rate schedules required by agreement to remain in force. Transmission service provided shall be subject to the following Acts, as amended: the Bonne- ville Project Act, the Regional Preference Act (Pl. 88-552), the Federal Columbia River Transmission System Act, and the Pacific Northwest Electric Power Planning and Conser- vation Act. The meaning of terms used in the transmission rate schedules shall be as defined in agreements or provisions which are attached to the Agree- ment or as in any of the above Acts. C. Interpretation If a provision in the executed Agreement is in conflict with a provision contained herein, the former shall prevail. SECTION II. BILLING FACTOR DEFINITIONS AND BILLING ADJUSTMENTS A. Billing Factors 1. Scheduled Demand The largest of hourly amounts wheeled which are scheduled by the customer during the time period specified in the rate schedules. 14 2. Metered Demand The Metered Demand in kilowatts shall be largest of the 60- minute clock -hour inte- grated demands measured by meters installed at each POD during each time period specified in the applicable rate sche- dule. Such measurements shall be made as specified in the Agreement. BPA, in deter- mining the Metered Demand, will exclude any abnormal readings due to or resulting from (a) emergencies or breakdowns on, or maintenance of, the FCRTS; or (b) emergen- cies on the customer's facilities, provided that such facilities have been adequately maintained and prudently operated as determined by BPA. If more than one class of power is delivered to any POD, the portion of the metered quantities assigned to any class of power shall be as agreed to by the parties. The amount so assigned shall constitute the Metered Demand for such class of power. 3. Transmission Demand The demand as defined in the Agreement. 4. Total Transmission Demand The sum of the transmission demands as defined in the Agreement. 5. Ratchet Demand The maximum demand established during the previous 11 billing months. Exception: I1 a Transmission Demand or Total Transmission Demand has been decreased pursuant to the terms of the Agreement during the previous 11 billing months, such decrease will be reflected in determining the Ratchet Demand. B. Billing Adjustments Average Power Factor The adjustment for average power factor, wher specified in a transmission rate schedule or it the Agreement, shall be made in accordance with the average power factor section of the General Wheeling Provisions. To maintain acceptable operating conditions or the Federal system, BPA may restrict deliveries of power at any time that the average leading power factor or average lagging power factor for all classes of power delivered to such poin or to such system is below 85 percent. SECTION III. OTHER DEFINITIONS Definitions of the terms below shall be applied to these provisions and the Transmission Rate Sched- ules, unless otherwise defined in the Agreement. A. Agreement An agreement between BPA and a customer to which these rate schedules and provisions may be applied. B. Decremental Cost As used in the MT rate schedule, Decremental Cost is as defined in the WSPP Agreement. C. Eastern Intertie The segment of the FCRTS for which the trans- mission facilities consist of the Townsend Garrison double- circuit 500 kV transmission line segment including related terminals at Garrison. D. Electric Power Electric peaking capacity (kW) and /or electric energy (kWh). E. Federal Columbia River Transmission System (FCRTS) The transmission facilities of the Federal Columbia River Power System (FCRPS), which include all transmission facilities owned by the Government and operated by BPA, and other facilities over which BPA has obtained transmis- sion rights. F. Firm Transmission Service Transmission service which BPA provides for any non -BPA power except for transmission service which is scheduled as nonfirm. If the firm serv- ice is provided pursuant to the Agreement, the terms of the Agreement may further define the service. G. Integrated Network The segment of the FCRTS for which the trans- mission facilities provide the bulk of transmis- sion of electric power within the Pacific North- west, excluding facilities not segmented to the network in the Wholesale Power Rate Devel- opment Study used in BPA's rate development. H. Main Grid As used in the FPT and IR rate schedules, that portion of the Integrated Network with facilities rated 230 kV and higher. 1. Main Grid Distance As used in the FPT rate schedules, the distance in airline miles on the Main Grid between the POI and the POD, multiplied by 1.15. 15 Main Grid Interconnection Terminal As used in the FPT rate schedules, Main Gri terminal facilities that interconnect the FCR1 with non -BPA facilities. K. Main Grid Miscellaneous Facilities As used in the FPT rate schedules, switching transformation, and other facilities of the Mai Grid not included in other components. L. Main Grid Terminal As used in the FPT rate schedules, the Main Gri terminal facilities located at the sending and /o receiving end of a line exclusive of the Inter connection terminals. M. Nonfirm Transmission Service Interruptible transmission service which BP/ may provide for non -BPA power. N. Northern Intertie The segment of the FCRTS for which the trans mission facilities consist of two 500 kV Tine between Custer substation and the Unite( States Canadian border, one 500 kV lin( between Custer and Monroe Substations, anc two 230 kV lines from Boundary substation tc the United States- Canadian border, and the associated substation facilities. O. Point of Integration (P01) Connection points between the FCRTS one non -BPA facilities where non Federal power i<- made available to BPA for wheeling. P. Point of Delivery (POD) Connection points between the FCRTS anc non -BPA facilities where non Federal power i1 delivered to a customer by BPA. Secondary System As used in the FPT and IR rate schedules, that portion of the Integrated Network facilities with operating voltage of 115 kV or 69 kV. R. Secondary System Distance As used in the FPT rate schedules, the number of circuit miles of Secondary System transmis- sion lines between the secondary POI or the Main Grid and the POD or the lower voltage FCRTS facilities which may be used on a use -of- facility basis. S. Secondary System Interconnection Terminal As used in the FPT rate schedules, the terminal facilities on the Secondary System that inter- connect the FCRTS with non -BPA facilities. Q. T. Secondary System Intermediate Terminal As used in the FPT rate schedules, the first and final terminal facilities in the Secondary System transmission path exclusive of the Secondary System Interconnection terminals. U. Secondary Transformation As used in the FPT rate schedules, transforma- tion from Main Grid to Secondary System facilities. V. Southern Intertie The segment of the FCRTS for which the major transmission facilities consist of two 500 kV AC lines from John Day Substation to the Oregon California border, a portion of the 500 kV AC line from Buckley Substation to Summer Lake Substation, and one 1,000 kV DC line between the Celilo Substation and the Oregon- Nevada border, and associated substation facilities. W. Transmission Service As used in the MT rate schedule, Transmission Service is as defined in.the WSPP Agreement. SECTION IV. BILLING INFORMATION A. Payment of Bills Bills for transmission service shall be rendered monthly by BPA. Failure to receive a bill shall not release the customer from liability for payment. Bills for amounts due of $50,000 or more must be paid by direct wire transfer; customers who expect that their average monthly bill will not exceed $50,000 and who expect special difficul- ties in meeting this requirement may request, and BPA may approve, an exemption from this requirement. Bills for amounts due BPA under $50,000 may be paid by direct wire transfer or mailed to the Bonneville Power Administration, P.O. Box 6040, Portland, Oregon 97228 -6040, or to another location as directed by BPA. The procedures to be followed in making direct wire transfers will be provided by the Office of Financial Management and updated as necessary. 1. Computation of Bills The transmission billing determinant is the electric ower quantified by the method specified in the Agreement or Transmission Rate Schedule. Scheduled power or metered power will be used. The transmission customer shall provide necessary information to BPA for any compu- tation required to determine the proper charges for use of the FCRTS, and shall 16 cooperate with BPA in the exchange of addi tional information which may be reasonabl useful for respective operations. Demand and energy billings for transmissio service under each applicable rate schedul shall be rounded to whole dollar amounts, b eliminating any amount which is less tha 50 cents and increasing any amounts fror 50 cents through 99 cents to the next high( dollar. 2. Estimated Bills At its option, BPA may elect to render a estimated bill to be followed at a subsequer billing date by a final bill. The estimated bi shall have the validity of and be subject to th same payment provisions as a final bill. 3. Due Date Bills shall be due by close of business on if 20th day after the date of the bill (due date Should the 20th day be a Saturday, Sunday, holiday (as celebrated by the customer), tF due date shall be the next following busine day. 4. Late Payment Bills not paid in full on or before close business on the due date shall be subject to penalty charge of $25. In addition, an intere charge of one twentieth percent (0.05 pe cent) shall be applied each day to the sum the unpaid amount and the penalty charg This interest charge shall be assessed on daily basis until such time as the unpa amount and penalty charge are paid in full Remittances received by mail will 1 accepted without assessment of the charg referred to in the preceding paragraph pr vided the postmark indicates the payme was mailed on or before the due date. Whe ever a power bill or a portion thereof remai unpaid subsequent to the due date and aft giving 30 days advance notice in writing, BI may cancel the contract for service to tl customer. However, such cancellation sh, not affect the customer's liability for al charges accrued prior thereto under sul agreement. 5. Disputed Billings In the event of a disputed billing, full pa ment shall be rendered to BPA and the d puted amount noted. Disputed amounts a subject to the late payment provisions spe fie d above. BPA shall separately account f the disputed amount. If it is determined that t customer is entitled to the disputed amount, BPA shall refund the disputed amount with interest, as determined by BPA's Office of Financial Management. BPA retains the right to verify, in a manner satisfactory to the Administrator, all data submitted to BPA for use in the calculation of BPA's rates and corresponding rate adjust- ments. BPA also retains the right to deny elig- ibility for any BPA rate or corresponding rate adjustment until all submitted data have been accepted by BPA as complete, accurate, and appropriate for the rate or adjustment under consideration. 6. Revised Bills At its option, BPA may render a revised bill. A revised bill shall replace all previous bills issued by BPA that pertain to a specified cus- tomer for a specified billing period if the amount of the revised bill is less than the amount of the original bill. If the amount of the revision causes an additional amount to be due BPA beyond the original bill, a revised bill will be issued for the difference. The date of the revised bill shall be deter- mined as follows: a. If the amount of the revised bill is equal to or less than the amount of the bill which it is replacing, the revised bill shall have the same date as the replaced bill. b. If the amount of the revised bill is greater than the amount of the bill which it is replacing, the date of the revised bill shall be its date of issue. 17 1 In reply refer to TC Mrs. Sheila Hardy Acting, City Light Director City of Port Angeles P.O. Box 1150 Port Angeles, WA 98362 The following contract documents are being sent to you for your records. Contract Number Department of Energy Bonneville Power Administration Puget Sound Area 201 Queen Anne Avenue North P.O. Box C -19030 Seattle, WA 98109 -1030 JAN 2 199 Type of Contract Document Number One Year Letter Transmission Agreement as Agreement for Exhibit A to Letter Morse Creek Transmission Agreement Please call if you have any questions regarding these documents. Sincerely, Geoff T. Reich Power Manager c CCU GCB `2.. rrn t V4V J f JAN 2 7 1989 CITY OF FORT ANGELES LIGHT DEPARTI OEUT 0 Originals 3 Authenticated Copies In reply refer to PMT Mr. Robert E. Orton City Light Director City of Port Angeles P.O. Box 1150 Port Angeles, WA 98362 Dear Mr. Orton: AUTHENTICATED COPY Department of Energy Bonneville Power AdMinistration P.O. Box 3621 Portland, Oregon 97208 3621 r I C�l OCT G61988��,3 I` V The City of Port Angeles (City) received nonfarm wheeling services for the Morse Creek project (Project) from Bonneville Power Administration (Bonneville) from October 20, 1987 through June 30, 1988. Since July 1, 1988, the City has received firm wheeling services at the UFT rate without benefit of a signed agreement. Both parties wish to ratify the firm wheeling service received to date and to extend the firm wheeling in accordance with provisions in section 1 below. Bonneville finds it necessary to implement this letter agreement prior to signing Contract No. DE— MS79- 88BP92315 (Long —term Agreement) because of the Washington Department of Fish's environmental concerns surrounding the Project. Therefore, Bonneville offers this letter agreement, pending resolution of the environmental issues raised in Articles 19 -25 of the FERC license for the Project. Until the Long —term Agreement can be executed the parties desire to operate under the terms of this letter agreement and Exhibit A (Long —term Agreement, draft dated August 18, 1988). 1. Term. This letter agreement shall be effective at 2400 hours on June 30, 1988 and shall terminate at 2400 hours on the earlier of: (a) the effective date of the Long —term Agreement or (b) 2400 hours on September 30, 1989; provided, however, that all liabilities incurred hereunder shall be preserved until satisfied. 2. Exhibit. Exhibit A is hereby made a part of this agreement; orovided, however, that section 1 of Exhibit A shall have no force and effect. 3. Operation Under Exhibit A. The parties shall operate pursuant to the terms of Exhibit A except as otherwise provided. The parties recognize Clallam County PUD (Utility) owns the interconnection facilities between the Project and the Government's Port Angeles Substation. Bonneville shall not be obligated to comply with Exhibit A if the Utility fails to perform its obligations as designated in Exhibit A. If the terms of this agreement are satisfactory, please indicate your acceptance by signing both enclosed copies and returning one copy to George Reich at the Puget Sound Area Office for authentication. ACCEPTED: CITY OF ?Ott ANGELES By /s/ Frank McPhee Title Date Enclosures Mayor 11/15/88 Sincerely, /s/ Walter E. Pollock Walter Pollock Assistant Administrator for Power Sales ATTEST; By /s/ Michelle Maike" Title City Clerk Date 11/15/88 2 TRANSMISSION AGREEMENT executed by the UNITED STATES OF AMERICA DEPARTMENT OF ENERGY acting by and through the BONNEVILLE POWER ADMINISTRATION and CLALLAM COUNTY PUD and CITY OF PORT ANGELES MORSE CREEK HYDRO PROJECT Index to Sections Contract No. DE- MS79- 888P92315 08/18/88 Section Pale 1. Term of Agreement 3 2. Definition and Explanation of Terms 3 3. Exhibits; Interpretations 4 4. Transmission of Electric Power and Energy 4 5. Payment Provisions 6 6. Termination of Agreement and Charges 7 7. Revision of Exhibits 7 8. Reactive Power 9 9. Metering Equipment 9 10. Several Obligations 9 11. Execution in Counterpart 10 Section Page Exhibit A (Transmission Rate Schedules and General Transmission Rate Schedule Provisions) 4 Exhibit B (General Wheeling Provisions (GNP Form -4R)) 4 Exhibit C (Transmission Parameters) 4 Exhibit D (Project, Point of Interconnection, Point of Delivery) 4 Exhibit E (Loss Factors) 4 Exhibit F (Resource Services) 4 This TRANSMISSION AGREEMENT, executed 19_, by the UNITED STATES OF AMERICA (Government), Department of Energy, acting by and through the BONNEVILLE POWER ADMINISTRATION (Bonneville), CLALLAM COUNTY PUD (Utility), a Public Utility District of the State of Washington, and the CITY OF PORT ANGELES (CITY), a municipality of the State of Washington; WITNESSETH: WHEREAS the Utility and the City have entered into, or intend to enter into, an agreement whereby the Utility will provide firm capacity in its transmission or distribution system facilities for the transmission of electric power generated at the Morse Creek Hydro Project (Project), and for interconnection of the Project to the facilities of the Utility (Interconnection Agreement); and WHEREAS the Utility and Bonneville have agreed to provide firm capacity on their transmission or distribution facilities for the transmission of power from the Project to the City; and WHEREAS the City owns the Project and the transmission service occurs over the Utility's and Bonneville's facilities for delivery to the City; and WHEREAS the load which is served hereunder at the Point of Interconnection 2 and the Point'of Delivery is in the control area of Bonneville; and WHEREAS Bonneville is authorized pursuant to law to dispose of electric power generated at various Federal hydroelectric projects in the Pacific Northwest, or acquired from other resources, to construct and operate transmission facilities, to provide transmission and other services, and to enter into agreements to carry out such authority; NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Term of Agreement. This agreement shall be effective commencing at 2400 hours on the date Bonneville has signed all original counterparts of this agreement (Effective Date), and unless terminated earlier pursuant to the terms of this Agreement, shall continue until 2400 hours on January 31, 2008. All obligations incurred hereunder shall continue until satisfied. Upon expiration of this agreement, Bonneville shall offer to extend transmission services provided hereunder, subject to the terms and conditions consistent with the then prevailing Bonneville rates, policy, and Federal Columbia River Transmission System (FCRTS) conditions. 2. Definition and Explanation of Terms. (a) "Electric Power" or "power" means electric peaking capacity, expressed in kilowatts, or electric energy expressed in kilowatthours, or both. (b) "Point of Delivery" means the point of delivery, described in Exhibit D, where electric power and energy are delivered to the City by Bonneville. (c) "Point of Interconnection" means the point described in Exhibit D where the project output will be made available by the Utility to Bonneville. (d) "Project" means the City's Morse Creek Hydro Project facility, described in Exhibit D, consisting of the site and generating units, and related transformation and transmission facilities. 3 4 (e) "Transmission Demand" means the amount specified in Exhibit C, expressed in kilowatts, which is the maximum hourly amount of electric energy to be made available to the City under this agreement at the Point of Delivery. (f) "Use -of- Facilities Charge" means the charge specified in Exhibit C, which is the monthly charge per kilowatt of Transmission Demand for the Point of Delivery; such charge has been calculated pursuant to the provisions of Exhibit A. 3. Exhibits; Interpretations. The rights and obligations of the parties with respect to provisions hereunder shall be subject to and governed by this agreement, including Exhibits A through F (Exhibits) attached hereto and by this reference made a part of this agreement. The provisions of section 38 of the General Wheeling Provisions [GWP Form -4R], Exhibit B, requires a minimum notice prior to a Rate Adjustment Date. If the rates are disapproved or conditions are placed on them by the agency authorized to approve Bonneville's transmission rates (Agency) or by any judicial interpretation of legislation by a court with jurisdiction over Bonneville, Bonneville shall not be required to give the minimum notice prior to resubmitting the rates to the Agency or implementing the Agency approved rates. The headings used in this agreement are for convenient reference only, and shall not affect the interpretation of this agreement. The City shall be the "Transferee" and the Utility and Bonneville shall be the "Transferor" referred to in the General Wheeling Provisions Exhibit. 4. Transmission of Electric Power and Eneray. (a) Before power shall be made available to the City, all equipment and facilities needed for safe and reliable interconnection to Bonneville's facilities shall be installed by the City and in operation as approved by Bonneville. If at any time during the term of this agreement the existence of Project generation creates disturbances on or otherwise degrades the integrity of the Federal Columbia River Transmission System (FCRTS), Bonneville may interrupt transmission services and require the City to install, or have installed at the City's expense, facilities necessary to correct such problems prior to resuming such services. In addition, Bonneville shall require use of its Revenue Metering System (RMS) meters in accordance with Section 9. (b) For each hour during the term hereof, the City shall make available or arrange to have made available to the Utility at the Utility's Morse Creek Point of Interconnection as defined in Exhibit D, and the Utility shall make available to Bonneville at the Government's Port Angeles Point of Interconnection as defined in Exhibit D, an amount of Electric Power metered at the Project less losses in accordance with Exhibit E. (c) For each hour during the term hereof, Bonneville shall make available to the City at the Point of Delivery for account of the City, the amount of Electric Power made available to Bonneville pursuant to subsection (b). (d) Bonneville shall add to the metered quantities monthly at the Point of Interconnection and subtract from the metered quantities monthly at the Point of Delivery the amount of power made available to Bonneville pursuant to subsection (b) above. (e) Nothing contained in the power sales contract between Bonneville and the Utility (Contract No. DE- MS79- 81BP90488 as amended by Amendatory Agreement No 1, dated June 3, 1982) and Bonneville and the City (Contract No. DE- MS79- 81BP90450) shall limit in any way the obligations of Bonneville or the Utility to the City to provide the firm transmission services hereunder. 5 5. Payment Provisions. (a) The City shall pay Bonneville each month for the transmission services and the resource services provided hereunder, an amount which shall be the sum of the products obtained by multiplying each of the charges for such services by its respective multiplier. The charges and multipliers shall be as specified in Exhibit C. The resource services shall be developed and described pursuant to section 7(d). Bonneville shall make appropriate billing adjustments during periods, if any, when the operation of the Project is limited by governmental agencies having jurisdiction over air and water quality standards therefor. Any ratchet demand that may occur as determined by Bonneville pursuant to the Transmission Rate Schedules and General Transmission Rate Schedule Provisions, does not constitute an increase in any Transmission Demand approved by Bonneville, and any continued service at such level will depend on the availability of facilities as determined by Bonneville. (b) The City shall pay the Utility each month for the transmission services provided by the Utility hereunder as provided in the Interconnection Agreement. Such obligation is an obligation of the City. (c) To the extent that the billing determinants contained in Exhibit C include a demand factor, which may be represented by a "transmission demand," "contract demand," "measured demand" or other type of demand quantity, the billing demand and ratchet provisions, if any, of the General Transmission Rate Schedule Provisions contained in Exhibit A shall apply to the calculation of payments. 6 6. Termination of Agreement and Charaes. This agreement may be terminated with mutual consent of the parties, which consent shall not be unreasonably withheld, (1) upon destruction or abandonment of the Project; (2) upon discontinuation of Project output under a final order of a public official having authority to issue such order; (3) upon termination of the Interconnection Agreement between the City and the Utility for the transfer of power for the Project; (4) upon denial of a license to construct and operate the Project from the Federal Energy Regulatory Commission (FERC) or its successor agency (Agency). This agreement may not be terminated by reason of a partial reduction in generating capability. If this agreement is terminated earlier than the term described in section 1 above, or if there is a partial reduction in generating capability, the City shall pay Bonneville as follows: (a) for the unamortized nonsalvable investment plus the cost of removal of any facilities Bonneville has constructed at Government expense for the purpose of providing transmission service for the Project hereunder; or (b) monthly at a rate that shall compensate Bonneville for the annual cost of the facilities so constructed, to the extent such facilities become unusable in whole or in part as the result of such destruction or abandonment of the Project or upon such partial permanent reduction or discontinuation of Project Output. The payment obligations in this section shall be the obligation of the City. 7. Revision of Exhibits. (a) The Use -of- Facility Transmission rate schedule attached hereto as Exhibit A has been finally confirmed and approved by the Agency. The rate schedule in Exhibit A shall be replaced by successor rate schedules in accordance with the provisions of section 70) of the Pacific Northwest Power Act and Agency rules. The Use -of- Facilities Charge specified in Exhibit C 7 shall be recalculated following any rate filing according to the provisions of such amended, modified, or successor rate schedules and associated provisions, and Bonneville shall prepare a new Exhibit C incorporating the revised Use —of— Facilities Charge. (b) If Bonneville determines that the charges specified in Exhibit C or any subsequent charges specified in this agreement must be changed pursuant to sections 19 or 38 of Exhibit B, it shall prepare a new Exhibit C incorporating such changes. Such new Exhibit C shall be substituted for the Exhibit C then in effect and shall become effective as of the date specified therein. (c) The loss factor specified in Exhibit E may be revised from time to time upon notification by the City and Utility, or Bonneville's determination that conditions at the Project or on the Utility's system have changed sufficiently to warrant recalculating the loss factor. Bonneville shall calculate the new loss factor and submit to the City and Utility by letter pursuant to Exhibit E. (d) Exhibit F shall be revised to include charges for resource services which Bonneville provides for the Project or upon determination by Bonneville that any such resource service charge contained therein must be changed to properly compensate Bonneville for providing such services. The resource services may include, but shall not be limited to, such services as operating reserves and making available amounts of power and energy to the City, pursuant to section 4(c) above, which vary from the amounts of actual Project generation. The resource service charge set forth in Exhibit F shall not be increased more frequently than once during any consecutive 12 month period. Bonneville shall provide the City and Bonneville's other customers with a reasonable opportunity of not less than 90 days to comment prior to the effective date of such proposed revised charges. Revised charges shall take effect on the date specified by Bonneville in its written notice to the City of its intention to revise such charge. 8 8. Reactive Power. It is the intent of the parties hereto that the voltage level at the Points of Interconnection and the Points of Delivery be controlled in accordance with prudent utility operating practice. The parties hereto shall jointly plan and operate their systems so as not to place an undue burden on the other party to supply or absorb reactive power accompanying or resulting from deliveries hereunder. 9. Meterina Equipment. Bonneville shall require use of a Revenue Metering System (RMS) unit or like unit meeting Bonneville's specifications to meter output from the Project. Bonneville shall perform all 0 &M services on the RMS unit. Likewise, the City shall use JEM meters, or equivalent, to determine output from the Project; and the City shall perform all 0 &M service on its meter. The cost associated with the purchase and maintenance of the RMS unit including repair or replacement shall be at the City's expense. The original purchase of the RMS unit is provided under Agreement No. DE- AI79- 87BP72149. Installation of telecommunications equipment for both Bonneville and City metering equipment and all service charges shall be at the City's expense. Ownership of the RMS equipment shall remain with the Government. 10. Several Obliaations. Except where specifically stated in this agreement to be otherwise, the duties, obligations, and liabilities of the parties are intended to be several and not joint or collective. Nothing contained in this agreement shall ever be construed to create an association, trust, partnership, or joint venture or to impose a trust or partnership duty, obligation, �r liability on or with regard to any party. Each party shall be individually and severally liable for its own obligation under this agreement. 9 11. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in several counterparts. 10 UNITED STATES OF AMERICA Department of Energy Bonneville Power Administrtion By Date CLALLAM COUNTY PUD ATTEST: By By Title Title Date Date CITY OF PORT ANGELES ATTEST: B y By Title Title Date Date (VS6- PMT- 0758e) 1987 Transmission Rate Schedules and General Transmission Rate Schedule Provisions Bonneville POWER ADMINISTRATION United States Department of Energy Bonneville Power Administration 905 NE. 11th Avenue Portland, Oregon 97232 Bonneville Power Administration's 1987 Transmission Rate Schedules and General Transmis- sion Rate Schedule Provisions, were approved on an interim basis by the Federal Energy Regulatory Commission, United States Department of Energy, in a commission order issued September 23, 1987, (Docket Nos. EF87- 2021 -000, et al.). These rate schedules and provisions became effective October 1,1987. These rate schedules and provisions supersede the Adminis- tration's Transmission Rate Schedules and General Transmission Rate Schedule Provisions effective July 1,1985. Existing rate schedules UFT -2, UFT -83, and TGT -1, for which final approval has been extended, are also included in this brochure. TRANSMISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS Current Transmission Rate Schedules Page FPT 87.1 Formula Power Transmission 1 FPT 87.3 Formula Power Transmission 2 IR Integration of Resources 3 IS Southern Intertie Transmission 4 IN Northern Intertie Transmission 5 IE Eastern Intertie Transmission 6 ET Energy Transmission 7 MT Market Transmission 8 Extension of Existing Transmission Rate Schedules 9 UFT -2 10 UFT-83 11 TGT -1 12 General Transmission Rate Schedule Provisions SKflON 1 SECTION 11 SCITION 111 SECTION IY TABLE OF CONTENTS Adoption of Revised Transmission Rate Schedules and General Transmission Date Schedule Provisions 14 Billing Factor Definitions and Billing Adjustments 14 Other Definitions 15 Billing Information 16 SECTION I. AVAILABILITY This schedule supersedes schedule FPT -85.1 for all firm transmission agreements which provide that rates may be adjusted not more frequently than once a year. It is available for firm transmission of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This sche- dule is for full -year and partial -year service and for either continuous or intermittent service when firm availability of service is required. For facilities at voltages lower than the Secondary System, a differ- ent rate schedule may be specified. Service under this schedule is subject to BPA's General Transmis- sion Rate Schedule Provisions. SECTION 1i. RATE A. Full -Year Service The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the Main Grid Charge, the Secondary System Charge, and Intertie Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component factors as specified in the Agreement: a. Main Grid Distance Factor: The amount computed by multiplying the Main Grid Distance by $0.0250 per mile; b. Main Grid Interconnection Terminal Fac- tor: $0.20; c. Main Grid Terminal Factor: $0.25; d. Main Grid Miscellaneous Facilities Factor: $1.04; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following compo- nent factors as specified in the Agreement: a. Secondary System Distance Factor: The amount determined by multiplying the Secondary System Distance by $0.1255 per mile; TRANSMISSION RATE SCHEDULES SCHEDULE FPT -87.1 FORMULA POWER TRANSMISSION 1 b. Secondary System Transformation Factor: $1.95; c. Secondary System Intermediate Terminal Factor: $0.72; d. Secondary System Interconnection Termi- nal Factor: $0.36; 3. Intertie Charge For use of the Southern Intertie facilities: $5.21. B. Partial -Year Service The monthly charge per kilowatt of billing demand shall be as specified in Section t1.A for all months of the year except for agreements whose term is 5 years or less and which specify service for fewer than 12 months per year, the monthly charge shall be: 1. during months for which service is specified, the monthly charge defined in Section IL.A, and 2. during other months, the monthly charge defined in Section II.A multiplied by 0.2. SECTION III. BILLING FACTORS Unless otherwise stated in the Agreement, the bill- ing demand shall be the largest of: A. the Transmission Demand; B. the highest hourly Scheduled Demand for the month; or C. the Ratchet Demand. SECTION 1. AVAILABILITY This schedule supersedes schedule FPT -83.3 for all firm transmission agreements which provide that rates may be adjusted not more frequently than once every 3 years. It is available for firm transmis- sion of electric power and energy using the Main Grid and /or Secondary System of the FCRTS. This schedule is for full -year and partial -year service and for either continuous or intermittent service when firm availability of service is required. For facilities at voltages lower than the Secondary System, a dif- ferent rate schedule may be specified. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE A. Full -Year Service The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the Main Grid Charge, the Secondary System Charge, and Interne Charge, as applicable and as specified in the Agreement. 1. Main Grid Charge The Main Grid Charge shall be the sum of one or more of the following component factors as specified in the Agreement: a. Main Grid Distance Factor: The amount computed by multiplying the Main Grid Distance by $0.0250 per mile; b. Main Grid Interconnection Terminal Fac- tor: $0.20; c. Main Grid Terminal Factor: $0.25; d. Main Grid Miscellaneous Facilities Factor: $1.04; 2. Secondary System Charge The Secondary System Charge shall be the sum of one or more of the following compo- nent factors as specified in the Agreement: a. Secondary System Distance Factor: The amount determined by multiplying the Secondary System Distance by $0.1255 per mile; b. Secondary System Transformation Factor: $1.95; SCHEDULE FPT -87.3 FORMULA POWER TRANSMISSION 2 c. Secondary System Intermediate Terminal Factor: $0.72; d. Secondary System Interconnection Termi- nal Factor: $0.36; 3. Intertie Charge For use of the Southern Intertie facilities: $5.21. B. Partial -Year Service The monthly charge per kilowatt of billing demand shall be as specified in Section II.A for all months of the year except for agreements whose term is 5 years or less and which specify service for fewer than 12 months per year, the charge shall be: 1. during months for which service is specified, the monthly charge defined in Section II.A, and 2. during other months, the monthly charge defined in Section II.A multiplied by 0.2. SECTION 111. BILLING FACTORS Unless otherwise stated in the Agreement, the bill- ing demand shall be the largest of: A. the Transmission Demand; B. the highest hourly Scheduled Demand for the month; or C. the Ratchet Demand. SECTION 1. AVAILABILITY This schedule supersedes IR -85 and is available for firm transmission service for electric power and energy using the Main Grid and /or Secondary Sys- tem of the FCRTS. The definitions of Main Grid and Secondary Systems are the same as for the FPT -87.1 and FPT -87.3 rate schedules and are contained in the General Transmission Rate Schedule Provisions. For facilities at voltages lower than the Secondary System, a different rate schedule may be specified. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The monthly charge shall be the sum of A and B where: A. The Demand Charge shall be: 1. $0.2600 per kilowatt of billing demand; or 2. for Points of Integration (P01) specified in the Agreement as being short distance POI's, for which Main Grid and Secondary System facil- ities are used for a distance of less than 75 circuit miles, the following formula applies: 0.2 (0.8/75 x transmission distance)] ,$0.2600 per kilowatt of billing demand) Where: the billing demand for a short distance PO1 is the demand level specified in the Agreement for such POI, and the transmission distance is the circuit miles between the POI for a generating resource of the customer and a designated Point of Delivery (POD) serving the Toad of the customer. Short distance POI's are determined by BPA after consider- ing factors in addition to transmission distance. B. The Energy Charge shall be: 0.85 mills /kWh of billing energy. SECTION I11. BILLING FACTORS To the extent that the Agreement provides for the customer to be billed for transmission in excess of the Transmission Demand or Total Transmission Demand, as defined in the Agreement, at the non- SCHEDULE IR -87 INTEGRATION OF RESOURCES 3 firm transmission rate (currently ET -87), such transmission service shall not contribute to either the Billing Demand or the Billing Energy for the IR rate provided that the customer requests such treatment and BPA approves in accordance with the prescribed provisions in the Agreement. A. Billing Demand The billing demand shall be the largest of: 1. the Transmission Demand, except under General Transmission Agreements where a Total Transmission Demand is defined; 2. the highest hourly Scheduled Demand for the month; or 3. the Ratchet Demand. B. Billing Energy The billing energy shall be the monthly sum of scheduled kilowatthours. SECTION 1. AVAILABILITY This schedule supersedes IS-85 and is available for all transmission on the Southern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION I1. RATE A. Nonfirm Rate The charge for nonfirm transmission of non BPA power shall be 1.4 mills /kWh of billing energy. This charge applies for both north -to- south and south -to -north transactions. B. Firm Power Transmission Rate The charge for firm transmission service granted access by BPA shall be $0.360 per kW per month of billing demand and 0.69 mills /kWh of billing energy. Firm transmission will only be made available to customers under this rate schedule who have executed a contract with BPA specifying use of the Firm Power Transmission rate for either north -to -south or south -to -north transactions. SECTION 111. BILLING FACTORS A. For services under Section 1I.A, the billing energy shall be the monthly sum of the sche- duled kilowatthours, plus the monthly sum of kilowatthours allocated but not scheduled. The amount of allocated but not scheduled energy that is subject to billing may be reduced prorata by BPA due to forced Intertie outages, and other uncontrollable forces that may reduce Intertie capacity. The amount of allocated but not sche- duled energy that is subject to billing also may be reduced upon mutual agreement between BPA and the customer. B. For services under Section 11.8, the billing demand shall be the Transmission Demand as defined in the Agreement. The billing energy shall be the monthly sum of scheduled kilowat- thours, unless otherwise specified in the Agreement. SCHEDULE IS-87 SOUTHERN INTERTIE TRANSMISSION SECTION 1. AVAILABILITY This schedule supersedes IN -85 and is available for all transmission on the Northern Intertie. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for transmission of non -BPA power on the Northern Intertie shall be 1.05 mills /kWh. SECTION 111. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. SCHEDULE IN-87 NORTHERN INTERTIE TRANSMISSION SECTION 1. AVAILABILITY This schedule supersedes IE -85 and is available for all nonfirm transmission on the Eastern Intertie. Serv- ice under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION I1. RATE The charge for transmission of nonfirm energy on the Eastern Intertie shall be 2.08 mills /kWh. SECTION III. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of the scheduled kilowatthours. SCHEDULE 1E-87 EASTERN INTERTIE TRANSMISSION SECTION 1. AVAILABILITY This schedule supersedes ET -85, unless otherwise specified in the Agreement, with respect to delivery using FCRTS facilities other than the Southern Intertie, Eastern Intertie, or the Northern Intertie, and is available for nonfirm transmission between points within the Pacific Northwest. BPA may inter- rupt service which is provided under this rate sche- dule. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION II. RATE The charge for such nonfirm transmission of non Federal electric energy shall be 1.61 mills /kWh. SECTION 111. BILLING FACTORS Billing Energy The billing energy shall be the monthly sum of scheduled kilowatthours. SCHEDULE ET-87 ENERGY TRANSMISSION a 7 SECTION 1. AVAILABILITY This schedule is available for Transmission Service for transactions using FCRTS facilities pursuant to the Western Systems Power Pool (WSPP) Agree- ment. Service under this schedule is subject to BPA's General Transmission Rate Schedule Provisions. SECTION 11. RATE The charge shall be determined in advance by BPA. The charge shall not exceed 33 percent of the dif- ference between the highest Decremental Cost of generation of the WSPP and the lowest Decremen- tal Cost of generation of the WSPP as determined by the WSPP Operating Committee during the year prior to the effective date of the WSPP Agreement. The Operating Committee may determine that a subsequent redetermination is necessary based upon the immediately preceeding years expe- rience. However, the transmission charge shall not be Tess than 1 mill per kilowatthour. SECTION 111. BILLING FACTORS The billing factors shall be specified in advance by BPA, as to representing the Transmission Service use or reservation. SCHEDULE MT-87 MARKET TRANSMISSION 8 Extension of Existing Transmission Rate Schedules UFT -2 The Bonneville Power Administration received extension of final approval for the UFT -2 wheeling rate from the Federal Energy Regulatory Commission, United States Department of Energy, in a commission order issued September 23, 1987, (Docket Nos. EF87- 2021 -000, et al.). This rate schedule is in effect through June 30, 1990. UFT-83 and TGT -1 The Bonneville Power Administration received extension of final approval for wheel- ing rate schedules UFT -83 and TGT -1, from the Federal Energy Regulatory Commis- sion, United States Department of Energy, in a commission order issued April 29,1987, (Docket Nos. EF85- 2021 -001, et al.). These rate schedules are in effect through June 30, 1990. 9 SECTION 1. AVAILABILITY This schedule is available for the firm transmission of electric power and energy over specified FCRTS facilities installed or operated primarily for the benefit or convenience of a limited number of cus- tomers. This schedule is not appropriate for new agreements for service over the integrated Net- work Segment, or the PNW -PSW Intense Segment. SECTION 11. RATE The monthly charge per kilowatt of Transmission Demand specified in the Agreement shall be one twelfth of the Annual Cost per kilowatt of Capacity of the specified facilities. Such Annual Cost shall be determined in accordance with Section III. SECTION III. DETERMINATION OF TRANSMISSION RATE A. From time to time, but not more often than once in each Contract Year, BPA shall determine the following data for the facilities which have been constructed or otherwise acquired by BPA and are used to transmit electric power and energy thereunder: 1. Capital cost of each such facility as specified in the most recently published plant invest- ment records of BPA which are issued in sup- port of the Federal Columbia River Power System financial statement. 2. Annual Interest and Amortization Ratios for each such facility using the most recent sys- tem average cost factors developed from actual Interest and Amortization costs for specific categories of FCRTS facilities and from data included in the financial statement. 3. Operation, maintenance, administrative and general, and general plant costs of such facili- ties using the most recent system average costs for specific categories of FCRTS facilities. 4. The yearly noncoincidental peak demands of all users of such facilities. B. The monthly charge per kilowatt of Transmis- sion Demand shall be one twelfth of the sum of the Annual Cost per kilowatt of each of the SCHEDULE UFT -2 USE -OF- FACILITIES TRANSMISSION 10 FCRTS facilities used. The Annual Cost per kilowatt of each facility constructed or other- wise acquired by BPA shall be determined in accordance with the following formula: (IXR) +B D Where B Operation, maintenance, adminis- trative and general, and general plant cost of such facility as determined in A.3. I Capital cost of such facility as determined in A.1. R Annual Interest and Amortization Ratio for such facility as determined in A.2. D The sum of the yearly noncoincidental demands on the facility as determined in A.4. The Annual Cost per kilowatt of facilities listed in the Agreement which are owned by another entity, and used by BPA for making deliveries to the Transferee, shall be determined from the costs specified in the Agreement between BPA and such other entity. SECTION IV. DETERMINATION OF TRANSMISSION DEMAND Unless otherwise stated in the Agreement, the fac- tor to be used in determining the kilowatts of Transmission Demand is the largest of: A. the Transmission Demand specified in the Agreement; B. the highest Measured or Scheduled Demand for the month, the Measured Demand being adjusted for power factor; or C. the Ratchet Demand. SECTION 1. AVAILABILITY This schedule supersedes UFT -1, and UFT -2, unless otherwise provided in the Agreement, and is avail- able for firm transmission over specified FCRTS facilities. SECTION 11. RATE The monthly charge per kilowatt of Transmission Demand specified in the Agreement shall be one twelfth of the annual cost of capacity of the speci- fied facilities divided by the sum of Transmission Demands (in kilowatts) using such facilities. Such annual cost shall be determined in accordance with Section 111. SECTION I11. DETERMINATION OF TRANSMISSION RATE A. From time to time, but not more often than once in each Contract Year, BPA shall determine the following data for the facilities which have been constructed or otherwise acquired by BPA, and which are used to transmit electric power and energy: 1. The annual cost of the specified FCRTS facili- ties, as determined from the capital cost of such facilities and annual cost ratios deve- loped from the FCRTS financial statement, including interest and amortization, opera- tion and maintenance, administrative and general, and general plant costs. 2. The yearly noncoincident peak demands of all users of such facilities or other reasonable measurement of the facilities' peak use. B. The monthly charge per kilowatt of billing demand shall be one twelfth of the sum of the annual cost of the FCRTS facilities used divided by the sum of Transmission Demands. The annual cost per kilowatt of Transmission Demand for a facility constructed or otherwise acquired by BPA shall be determined in accor- dance with the following formula: A D where: A The annual cost of such facility as deter- mined in accordance with A.1. above. SCHEDULE UFT -83 USE -OF- FACILITIES TRANSMISSION 11 D The sum of the yearly noncoincident demands on the facility as determined in accor- dance with A.2. above. 'The annual cost per kilowatt of facilities listed in the Agreement which are owned by another entity, and used by BPA for making deliveries to the transferee, shall be determined from the costs specified in the Agreement between BPA and such other entity. SECTION IV. DETERMINATION OF BILLING DEMAND Unless otherwise stated in the Agreement, the fac- tor to be used in determining the kilowatts of billing demand shall be the largest of: A. the Transmission Demand in kilowatts specified in the Agreement; B. the highest hourly Measured or Scheduled Demand for the month, the Measured Demand being adjusted for power factor; or C. The Ratchet Demand. SECTION 1. AVAILABILITY This schedule shall apply to all agreements which provide for the firm transmission of electric power and energy over transmission facilities of BPA's sec- tion of the Montana [Eastern) Intertie. SECTION 11. RATE The monthly charge shall be one twelfth of the sum of the annual charges listed below, as applicable and as specified in the agreements for firm trans- mission. The Townsend Garrison 500 -kV lines and associated terminal, line compensation, and com- munication facilities are a separately identified por- tion of the Federal Transmission System. Annual revenues plus credits for Government use should equal annual costs of the facilities, but in any given year there may be either a surplus or a deficit. Such surpluses or deficits for any year shall be accounted for in the computation of annual costs for succeed inF years. Revenue requirements from firm trans msssion use will be decreased by any revenues received from nonfirm use and credits for all Government use. The general methodology for determining the firm rate is to divide the revenue requirement by the total firm capacity require- ments. Therefore, the hil3her the total capacity requirements, the lower will be the unit rate. If the Government provides firm transmission serv- ice in its section of the Montana [Eastern' Intertie in exchange for firm transmission service in a custo- mer's section of the Montana Intertie, the payment by the Government for such transmission services provided by such customer will be made in the form of a credit in the calculation of the Intertie Charge for such customer. During an estimated 1 to 3 -year period following the commercial opera- tion date oft the third generating unit at the Colstrip Thermal Generating Plant at Colstrip, Montana, the capability of the Federal Transmission System west of Garrison Substation may be different from the long -term situation. It may not be possible to com- plete the extension of the 500 -kV portion of the Federal Transmission System to Garrison by such commercial operation date. In such event, the 500/230 kV transformer will be an essential exten- sion of the Townsend- Garrison Intertie facilities, and the annual costs of such transformer will be included in the calculation of the Intertie Charge. SCHEDULE TGT=1 TOWNSEND GARRISON TRANSMISSION 12 However, starting 1 month after extension to Garri- son of the 500 -kV portion of the Federal Transmis- sion System, the annual costs of such transformer will no longer be included in the calculation of the Intertie Charge. A. Nonfirm Transmission Charge: This charge will be filed as a separate Rate Sche- dule and revenues received thereunder will reduce the amount of revenue to be collected under the Intertie Charge below. B. Intertie Charge for Firm Transmission Service: Intertie Charge [(TAC /12 -NFR) x (CR -ECl TCR SECTION 111. DEFINITIONS A. TAC Total Annual Costs of facilities associated with the Townsend- Garrison 500 -kV Transmis- sion line including terminals, and prior to extension of the 500 -kV portion of the Federal Transmission System to Garrison, the 500/230 kV transformer at Garrison. Such annual costs are the total of (1) interest and amortization of asso- ciated Federal investment and the appropriate allocation of general plant costs; (2) operation and maintenance costs; (3) allowance for Bonne ville's general administrative costs which are appropriately allocable to such facilities; and (4) payments made pursuant to section 7(m) of Public Law 96 -501 with respect to these facilities. Total Annual Costs shall be adjusted to reflect reductions to unpaid total costs as a result of any amounts received, under agreements for firm transmission service over the Montana Intertie, by the Government on account of any reduc- tion in Transmission Demand, termination or partial termination of any such agreement or otherwise to compensate BPA for the unamor- tized investment, annual cost, removal, salvage, or other cost related to such facilities. B. NFR Nonfirm Revenues, which are equal to (1) the product of the Nonfirm Transmission Charge described in II(A) above, and the total nonfirm energy transmitted over the Townsend Garrison line segment under such charge for such month; plus (2) the product of the Non -Firm Transmission Charge and the total nonfirm energy transmitted in either direction by the Government over the Townsend Garrison line segment for such month. C. CR Capacity Requirement of a customer on the Townsend- Garrison 500 -kV transmission facilities as specified in its firm transmission agreement. D. TCR Total Capacity Requirement on the Townsend- Garrison 500 -kV transmission facili- ties as calculated by adding (1) the sum of all Capacity Requirements (CR) specified in trans- mission agreements described in section l; and (2) the Government's firm capacity require- ment. The Government's firm capacity requirement shall be no less than the total of the amounts, if any, specified in firm transmission agreements for use of the Montana Intertie. E. EC Exchange credit for each customer which is the product of (1) the ratio of investment in the Townsend Broadview 500 -kV transmission line to the investment in the Townsend- Garrison 500 -kV transmission line; and (2) the capacity which the Government obtains in the Townsend Broadview 500 -kV transmission line through exchange with such customer. If no exchange is in effect with a customer, the value of EC for such customer shall be zero. 13 GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS SECTION 1. ADOPTION OF REVISED TRANSMISSION RATE SCHEDULES AND GENERAL TRANSMISSION RATE SCHEDULE PROVISIONS A. Approval of Rates These rate schedules and General Transmission Rate Schedule Provisions (GTRSP) shall become effective upon approval by the Federal Energy Regulatory Commission. BPA will request FERC approval effective October 1, 1987. BPA is requesting that all proposed Transmission Rate Schedules be effective for a period of 2 years, from October 1, 1987, through September 30, 1989, with the exception of the FPT 87.3 rate schedule, which is effective for a period of 3 years, through September 30,1990. B. General Provisions These 1987 Transmission Rate Schedules and associated GTRSP supersede in their entirety BPA's 1985 Transmission Rate Schedules and GTRSP (which became effective July 1,1985) but do not supersede prior rate schedules required by agreement to remain in force. Transmission service provided shall be subject to the following Acts, as amended: the Bonne- ville Project Act, the Regional Preference Act (P.L. 88-552), the Federal Columbia River Transmission System Act, and the Pacific Northwest Electric Power Planning and Conser- vation Act. The meaning of terms used in the transmission rate schedules shall be as defined in agreements or provisions which are attached to the Agree- ment or as in any of the above Acts. C. Interpretation If a provision in the executed Agreement is in conflict with a provision contained herein, the former shall prevail. SECTION II. BILLING FACTOR DEFINITIONS AND BILLING ADJUSTMENTS A. Billing Factors 1. Scheduled Demand The largest of hourly amounts wheeled which are scheduled by the customer during the time period specified in the rate schedules. 14 2. Metered Demand The Metered Demand in kilowatts shall be largest of the 60- minute clock -hour inte- grated demands measured by meters installed at each POD during each time period specified in the applicable rate sche- dule. Such measurements shall be made as specified in the Agreement. BPA, in deter mining the Metered Demand, will exclude any abnormal readings due to or resulting from (a) emergencies or breakdowns on, or maintenance of, the FCRTS; or (b) emergen- cies on the customer's facilities, provided that such facilities have been adequately maintained and prudently operated as determined by BPA. If more than one class of power is delivered to any POD, the portion of the metered quantities assigned to any class of power shall be as agreed to by the parties. The amount so assigned shall constitute the Metered Demand for such class of power. 3. Transmission Demand The demand as defined in the Agreement. 4. Total Transmission Demand The sum of the transmission demands as defined in the Agreement. 5. Ratchet Demand The maximum demand established during the previous 11 billing months. Exception: If a Transmission Demand or Total Transmission Demand has been decreased pursuant to the terms of the Agreement during the previous 11 billing months, such decrease will be reflected in determining the Ratchet Demand. B. Billing Adjustments Average Power Factor The adjustment for average power factor, when specified in a transmission rate schedule or in the Agreement, shall be made in accordance with the average power factor section of the General Wheeling Provisions. To maintain acceptable operating conditions on the Federal system, BPA may restrict deliveries of power at any time that the average leading power factor or average lagging power factor for all classes of power delivered to such point or to such system is below 85 percent. SECTION III. OTHER DEFINITIONS Definitions of the terms below shall be applied to these provisions and the Transmission Rate Sched- ules, unless otherwise defined in the Agreement. A. Agreement An agreement between BPA and a customer to which these rate schedules and provisions may be applied. B. Decremental Cost As used in the MT rate schedule, Decremental Cost is as defined in the WSPP Agreement. C. Eastern Intertie The segment of the FCRTS for which the trans- mission facilities consist of the Townsend Garrison double- circuit 500 kV transmission line segment including related terminals at Garrison. D. Electric Power Electric peaking capacity (kW) and /or electric energy (kWh). E. Federal Columbia River Transmission System (FCRTS) The transmission facilities of the Federal Columbia River Power System (FCRPS), which include all transmission facilities owned by the Government and operated by BPA, and other facilities over which BPA has obtained transmis- sion rights. F. Firm Transmission Service Transmission service which BPA provides for any non -BPA power except for transmission service which is scheduled as nonfirm. If the firm serv- ice is provided pursuant to the Agreement, the terms of the Agreement may further define the service. G. Integrated Network The segment of the FCRTS for which the trans- mission facilities provide the bulk of transmis- sion of electric power within the Pacific North- west, excluding facilities not segmented to the network in the Wholesale Power Rate Devel- opment Study used in BPA's rate development. H. Main Grid As used in the FPT and IR rate schedules, that portion of the Integrated Network with facilities rated 230 kV and higher. I. Main Grid Distance As used in the FPT rate schedules, the distance in airline miles on the Main Grid between the POI and the POD, multiplied by 1.15. 15 Main Grid Interconnection Terminal As used in the FPT rate schedules, Main Grid terminal facilities that interconnect the FCRTS with non -BPA facilities. K. Main Grid Miscellaneous Facilities As used in the FPT rate schedules, switching, transformation, and other facilities of the Main Grid not included in other components. L Main Grid Terminal As used in the FPT rate schedules, the Main Grid terminal facilities located at the sending and /or receiving end of a line exclusive of the Inter- connection terminals. M. Nonfirm Transmission Service Interruptible transmission service which BPA may provide for non -BPA power. N. Northern Intertie The segment of the FCRTS for which the trans- mission facilities consist of two 500 kV lines between Custer substation and the United States Canadian border, one 500 kV line between Custer and Monroe Substations, and two 230 kV lines from Boundary substation to the United States Canadian border, and the associated substation facilities. O. Point of Integration (P01) Connection points between the FCRTS and non -BPA facilities where non Federal power is made available to BPA for wheeling. P. Point of Delivery (POD) Connection points between the FCRTS and non -BPA facilities where non Federal power is delivered to a customer by BPA. Q. Secondary System As used in the FPT and IR rate schedules, that portion of the Integrated Network facilities with operating voltage of 115 kV or 69 kV. R. Secondary System Distance As used in the FPT rate schedules, the number of circuit miles of Secondary System transmis- sion lines between the secondary POI or the Main Grid and the POD or the lower voltage FCRTS facilities which may be used on a use -of- facility basis. S. Secondary System Interconnection Terminal As used in the FPT rate schedules, the terminal facilities on the Secondary System that inter- connect the FCRTS with non -BPA facilities. I. T. Secondary System Intermediate Terminal As used in the FPT rate schedules, the first and final terminal facilities in the Secondary System transmission path exclusive of the Secondary System Interconnection terminals. U. Secondary Transformation As used in the FPT rate schedules, transforma- tion from Main Grid to Secondary System facilities. V. Southern Intertie The segment of the FCRTS for which the major transmission facilities consist of two 500 kV AC lines from John Day Substation to the Oregon California border, a portion of the 500 kV AC line from Buckley Substation to Summer Lake Substation, and one 1,000 kV DC line between the Celilo Substation and the Oregon- Nevada border, and associated substation facilities. W. Transmission Service As used in the MT rate schedule, Transmission Service is as defined in the WSPP Agreement. SECTION IV. BILLING INFORMATION A. Payment of Bills Bills for transmission service shall be rendered monthly by BPA. Failure to receive a bill shall not release the customer from liability for payment. Bills for amounts due of $50,000 or more must be paid by direct wire transfer; customers who expect that their average monthly bill will not exceed $50,000 and who expect special difficul- ties in meeting this requirement may request, and BPA may approve, an exemption from this requirement. Bills for amounts due BPA under $50,000 may be paid by direct wire transfer or mailed to the Bonneville Power Administration, P.O. Box 6040, Portland, Oregon 97228 -6040, or to another location as directed by BPA. The procedures to be followed in making direct wire transfers will be provided by the Office of Financial Management and updated as necessary. 1. Computation of Bills The transmission billing determinant is the electric ower quantified by the method specified in the Agreement or Transmission Rate Schedule. Scheduled power or metered power will be used. The transmission customer shall provide necessary information to BPA for any compu- tation required to determine the proper charges for use of the FCRTS, and shall 16 cooperate with BPA in the exchange of addi- tional information which may be reasonably useful for respective operations. Demand and energy billings for transmission service under each applicable rate schedule shall be rounded to whole dollar amounts, by eliminating any amount which is less than 50 cents and increasing any amounts from 50 cents through 99 cents to the next higher. dollar. 2. Estimated Bills At its option, BPA may elect to render an estimated bill to be followed at a subsequent billing date by a final bill. The estimated bill shall have the validity of and be subject to the same payment provisions as a final bill. 3. Due Date Bills shall be due by close of business on the 20th day after the date of the bill (due date). Should the 20th day be a Saturday, Sunday, or holiday (as celebrated by the customer), the due date shall be the next following business day. 4. Late Payment Bills not paid in full on or before close of business on the due date shall be subject to a penalty charge of $25. I n addition, an interest charge of one twentieth percent (0.05 per- cent) shall be applied each day to the sum of the unpaid amount and the penalty charge. This interest charge shall be assessed on a daily basis until such time as the unpaid amount and penalty charge are paid in full. Remittances received by mail will be accepted without assessment of the charges referred to in the preceding paragraph pro- vided the postmark indicates the payment was mailed on or before the due date. When- ever a power bill or a portion thereof remains unpaid subsequent to the due date and after giving 30 days advance notice in writing, BPA may cancel the contract for service to the customer. However, such cancellation shall not affect the customer's liability for any charges accrued prior thereto under such agreement. S. Disputed Billings In the event of a disputed billing, full pay- ment shall be rendered to BPA and the dis- puted amount noted. Disputed amounts are subject to the late payment provisions speci- fied above. BPA shall separately account for the disputed amount. If it is determined that the customer is entitled to the disputed amount, BPA shall refund the disputed amount with interest, as determined by BPA's Office of Financial Management. BPA retains the right to verify, in a manner satisfactory to the Administrator, all data submitted to BPA for use in the calculation of BPA's rates and corresponding rate adjust- ments. BPA also retains the right to deny elig- ibility for any BPA rate or corresponding rate adjustment until all submitted data have been accepted by BPA as complete, accurate, and appropriate for the rate or adjustment under consideration. 6. Revised Bills At its option, BPA may render a revised bill. A revised bill shall replace all previous bills issued by BPA that pertain to a specified cus- tomer for a specified billing period if the amount of the revised bill is less than the amount of the original bill. If the amount of the revision causes an additional amount to be due BPA beyond the original bill, a revised bill will be issued for the ifference. The date of the revised bill shall be deter- mined as follows: a. If the amount of the revised bill is equal to or Tess than the amount of the bill which it is replacing, the revised bill shall have the same date as the replaced bill. b. If the amount of the revised bill is greater than the amount of the bill which it is replacing, the date of the revised bill shall be its date of issue. 17 GWP Form -4R (04- 15 -83) GENERAL WHEELING PROVISIONS Index to Sections Section Page GENERAL APPLICATION 1. Interpretation 2 2. Definitions 2 3. Prior Demands 4 4. Measurements 4 5. Measurements and' Installation of Meters 5 6. Tests of Metering Installations 5 7. Adjustment for Inaccurate Metering 5 8. Character of Service 6 9. Point(s) of Delivery and Delivery Voltage 6 10. Combining Deliveries Coincidentally 6 11. Suspension of Deliveries 6 12. Continuity of Service 6 13. Uncontrollable Forces 7 14. Reducing Charges for Interruptions 7 15. Net Billing 7 16. Average Power Factor 7 17. Permits 8 18. Ownership of Facilities 8 19. Adjustment for Change of Conditions 8 20. Dispute Resolution and Arbitration 9 21. Contract Work Hours and Safety Standards 10 22. Convict Labor 11 23. Equal Employment Opportunity 11 24. Additional Provisions 12 25. Reports 1 26. Assignment of Contract 12 27. Waiver of Default 13 28. Notices and Computation of Time 13 29. Interest of Member of Congress 13 APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancing Phase Demands 13 31. Adjustment for Unbalanced Phase Demands 13 32. Changes in Requirements or Characteristics 13 33. Inspection of Facilities 13 34. Electric Disturbances 15 35. Harmonic Control APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor RELATING ONLY TO RURAL ELECTRIFICATION BORROWERS 37. Approval of Contract APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates 15 15 15 GENERAL APPLICATION 1. Interpretation. (a) The provisions in this exhibit shall be deemed to be a part of the contract body to which they are an exhibit. If a provision in such contract body is in conflict with a provision contained herein, the former shall prevail. (b) If a provision in the General Transmission Rate Schedule Provisions 1s in conflict with a provision in this exhibit or the contract body, this exhibit or the contract body shall prevail. (c) Nothing contained in this contract shall, in any manner, be construed to abridge, limit, or deprive any party thereto of any means of enforcing any reedy, either at law or in equity, for the breach of any of the provisions thereof which it would otherwise have. 2. Definitions. As used in this contract: (a) "Contractor," "Utility" or "Borrower" means the party to this contract other than Bonneville. (b•) "Federal System" or "Federal System Facilities" means the facilities of the Federal Columbia River Power System, which for the purposes of this contract shall be deemed to include the generating facilities of the Government in the Pacific Northwest for which Bonneville is designated as marketing agent; the facilities of the Government under the Jurisdiction of Bonneville; and any other facilities: (1) from which Bonneville receives all or a portion of the generating capability (other than station service) for use in meeting Bonneville's loads, such facilities being included only to the extent Bonneville has the right to receive such capability; provided, however, that Bonneville's loads" shall not include that portion of the loads of any Bonneville customer which are served by a nonfederal generating resource purchased or owned directly by such customer which may be scheduled by Bonneville; (2) which Bonneville may use under contract, or license; or (3) to the extent of the rights acquired by Bonneville pursuant to the Treaty, between the Government and Canada, relating to the cooperative development of water resources of the Columbia River Basin, signed in Washington, O.C., on January 17, 1961. (c) "Integrated Demand" means the number of kilowatts which is equal to the number of kilowatt -hours delivered at any point during a clock hour. •(d) "Measured Demand" means the maximum Integrated Demand for a billing month determined from measurements made as specified in the contract or as determined in section 4 hereof when metering or other data are not available for such purpose. Bonneville, in determining he Measured Demand, will exclude any abnormal Integrated Demands due to, or resulting from (a) emergencies or breakdowns on, or maintenance of, either parties' facilities, and (b) emergencies on facilities of the Transferee, provided that such facilities have been adequately maintained and prudently operated as determined by Bonneville. If the contract provides for delivery of more than one class of power to a Transferee at any Point of Delivery, the portion of each Integrated Demand assigned to any class of power shall be determined as specified in the contract. The portion of the Integrated Demand so assigned shall constitute the Measured Demand for such class of power. (e) "Aionth' means the period commencing at the time when the meters mentioned in this contract are read by Bonneville and ending approximately 30 days thereafter when a subsequent reading of such meters is made by Bonneville. (f) "Point(s) of Delivery" means the point(s) of delivery listed either in the Points of Delivery Exhibit to this contract or in the body of this contract. (g) "System" or "Facilities" means the transmission facilities: (1) which are owned or controlled by either party, or (2) which either party may use under lease, easement, or license. (h) 'Transferee" means an entity which receives power or energy from the system of the Transferor. (i) "Transferor" means an entity which receives at one point on its system a supplying entity's power or energy and makes such power or energy available at another point on its system for the account of the delivering entity or a third party. (j) "Uncontrollable Forces" means: (1) strikes or work stoppage affecting the operation of the Contractor's works, system, or other physical facilities or of the Federal System Facilities or the physical facilities of any Transferee upon which such operation is completely dependent; the term "strikes or work stoppage' shall be deemed to include threats of imminent strikes or work stoppage which reasonably require a party or Transferee to restrict or terminate its operations to prevent substantial loss.or damage to its works, system, or other physical facilities; or (2) such of the following events as the Contractor or Bonneville or any Transferee by exercise of reasonable diligence and foresight, could not reasonably have been expected to avoid: (A) events, reasonably beyond the control of either party or any Transferee, causing failure, damage, or destruction of any works, system or facilities of such party or Transferee; the word "failure" 3 shall be deemed to include interruption of, or interference with, the actual operation of such works, system, or facilities; (B) floods or other conditions caused by nature which limit or prevent the operation of, or which constitute an imminent threat of damage to, any such works, system, or facilities; and (C) orders and temporary or permanent injunctions which prevent operation, in whole or in part, of the works, system, or facilities of either party or any Transferee, and which are issued in any bona fide proceeding by: 1. any duly constituted court of general jurisdiction; or -fi. any administrative agency or officer, other than Bonneville or its officers, provided by law (a) tf said party or Transferee has no right to a review of the validity of such order by a court of competent jurisdiction; or (b) if such order is operative and effective unless suspended, set aside, or annulled by a court of competent jusidiction and such order is not suspended, set aside, or annulled in a judicial proceeding prosecuted by said party or Transferee in good faith; provided, however, that if such order is suspended, set aside, or annuiTed 'in sue a judicial proceeding, it shall be deemed to be an "uncontrollable force" for the period during which it is in effect; provided, further, that said party or Transferee, shall not be required to prosecute such a proceeding, in order to have the benefits of this section, if the parties agree that there is no valid basis for contesting the order. The term "operation" as used in this subsection shall be deemed to include construction, if construction is required to implement the contract and is specified therein. 3. Prior Demands. (a) In determining any credit demand mentioned in, or money compensation to be paid under this contract for any month, Integrated Demands at which electric energy was delivered by the Transferor at Points of Delivery mentioned herein for the account of the other party to this contract prior to the date upon which the contract takes effect shall be considered in the same manner as if this contract had been in effect. (b) If either party has delivered electric power and energy to the other party at any Point of Delivery specified in this contract or in any previous contract, and such Point of Oelivery is superseded by another Point of Delivery specified in this contract, the Measured Oemands, if any, at the superseded Point of Delivery shall be considered for the purpose of determining. the charges paid to the Transferor for the electric power and energy delivered under this contract at such superseded point. 4. Measurements. Except as it is otherwise provided in section 7, each measurement or eacn meter mentioned in this contract shall be the measurement automatically recorded by such meter or, at the request of either party, the measurement as mutually determined by the best available information. If it is provided in this contract that measurements made by any of the meters specified therein are to be adjusted for losses, such adjustments shall be made by using factors, or by compensating the meters, as agreed upon by the parties hereto. If changes in conditions occur which substantially affect any such loss factor or compensation, it will be changed in a manner which will conform to such change in conditions. 5. Measurements and Installation of Meters. Bonneville may at any time install a meter or metering equipment to make the measurements for any Point of Delivery required for any computation or determination mentioned in this contract, and if so installed, such measurements shall be used thereafter in such computation or determination. 6. Tests of Metering Installations. Each party to this contract shall, at its expense, test its metering installations associated-with this contract at least once every two years, and, if requested to do so by the other party, shall make additional tests or inspections of such installations, the expense of which shall be paid by such other party unless such additional tests or inspections show the measurements of such installations to be inaccurate as specified in section 7. Each party shall give reasonable notice of the time when any such test or inspection is to be made to the other party who may have representatives present at such test or inspection. Any component of such installations found to be defective or inaccurate shall be adjusted, repaired or replaced to provide accurate metering.. 7. Adjustment for Inaccurate Metering, (a) If any meter mentioned in this contract fails to register, or if the measurement made by such meter during a test made as provided in section 6 varies by more than one percent from the measurement made by the standard meter used in such test, or if an error in meter reading occurs, adjustment shall be made correcting all measurements for the actual period during which such inaacurate measurements were made, if such period can be determined. If such period cannot be determined, the adjustment shall be made for the period immediately preceding the test of such meter which is equal to the lesser of (a) one -half the time from the date of the last preceding test of such meter, or (b) six months. Such corrected measurements shall be used to recompute the amounts of any electric power and energy to be made available, or any credits to be made in any exchange energy account, and of any money compensation to be paid to the Transferor as provided in this contract. (b) If the credit theretofore made to the Transferor in the exchange energy account varies from the credit to be made as recomputed, the amount of the variance will be credited in such exchange energy account to the party entitled thereto. (c) If the money compensation theretofore paid to the Transferor varies from the money compensation to be paid as recomputed, the amount of the variance will be paid to the party entitled thereto after both parties have agreed to such recomputation and within 30 days after receipt of invoice by the designated payment office of the payer; provided, however, that the other 5 i party may deduct such amount due it from any money compensation which thereafter becomes due the Transferor under this contract. 8. Character of Service. Unless otherwise specifically provided for in the contract,eiectric power and energy made available pursuant to this contract shall be in the form of three -phase current, alternating at a nominal frequency of 60 hertz. 9. Point(s) of Delivers and Delivery Voltage. Electric power and energy shall be delivered to each Transferee at such point or points and at such voltage or voltages as are agreed upon by the parties hereto. 10. Combining Deliveries Coincidentally. If it is provided in this contract tnat cnarges tor electric power and energy made available at two or more Points of Delivery will be made by combining deliveries at such points coincidentally: (a) the total Measured Demand to be considered in determining the billing demand for each billing month shall be the largest sum obtained by adding for each demand interval of such month the corresponding Integrated Demands of the Transferee at all such points after adjusting said Integrated Demands as appropriate to such points; (b) the number of kilowathours to be used in the energy charge, if any, and the average power factor at which electric energy is delivered at such points under this contract, during such month, shall be the sum of the amounts of electric energy delivered. at such points under this contract during such month; and (c) the number of reactive kilovolt -ampere-hours to be used in determining such average monthly power factor shall be the sum of the reactive kilovolt- ampere -hours delivered at such points under this contract such month. 11. Suspension of Deliveries. The other party to this contract may at any time notfTy the transferor i n writing to suspend the deliveries of electric power and energy provided for in this contract. Upon receipt of any such notice, the Transferor will forthwith discontinue, and will not resume, such deliveries until notified to do so by the other party, and upon receipt of such notice from the other party to do so, will forthwith resume such deliveries. 12. Continuity of Service. Either party may temporarily interrupt or reduce deliveries dl power and energy if such party determines that such interruption or reduction is necessary or desirable in case of system emergencies, Uncontrollable Forces, or in order to install equipment in, make repairs to, make replacements within, make investigations and inspections of, or perform other maintenance work on its system. Except in case of emergency and in order that each party's operations will not be unreasonably interfered with, such party shall give notice to the other party of any such interruption or reduction, the reason therefor, and the probable duration thereof to the extent such party has knowledge thereof. Each party shall effect the use of temporary facilities or equipment to minimize the effect of any such interruption or outage to the extent reasonable or appropriate. 13. Uncontrollable Forces. Each party shall notify the other as soon as possible or any OnconiFITTTFUTF Forces which may in any way affect the delivery of power hereunder. In the'event the operations of either party are interrupted or curtailed due to such Uncontrollable Forces, such party shall exercise due diligence to reinstate such operations with reasonable dispatch. 14. Reducing Charges for Interruptio If deliveries of electric power and energy to the lransferee are suspended, interrupted, interfered with or- curtailed due to Uncontrollable Forces on either the Transferee's System or Transferor's System, or if the Transferor interrupts or reduces deliveries to the Transferee for any of the reasons stated in section 12 hereof, the credit in the exchange energy account which would otherwise be made, or the money compensation which would otherwise be paid to the Transferor, shall be appropriately reduced. No interruption, or equivalent interruption, of less than 30 minutes duration will be considered for computation of such reduction in charges. 15. Net Billing. Upon mutual agreement of the parties, payment due one party may be offset against payments due the other party under all contracts between the parties hereto for the sale and exchange of electric power and energy, use of transmission facilities, operation and maintenance of electric facilities, lease of electric facilities, mutual supply of emergency and standby electric power and energy, and under such other contracts between such parties as the parties may agree, unless otherwise provided in existing contracts between the parties. Under contracts included in this procedure, all payments due one party in any month shalt be offset against payments due the other party in such month, and the resulting net balance shall be paid to the party in whose favor such balance exists unless the latter elects to have such balance carried forward to be added to the payments due it in a succeeding month. 16. Average Power Factor. (a) The formula for determining average power factor is as follows: Average Power Factor Kilowatthours /(Kilowatthours)' (Reactive Kilovolt- ampere hours)' The data used in the above formula shall be obtained from meters which are ratcheted to prevent reverse registration. (b) When delivery of electric power and energy by the Transferor at any point is commingled with any other class or classes of power and it I s impracticable to separately meter the kilowatthours and reactive kilovolt- ampere -hours for each class, the average power factor of the total delivery of such electric power and energy for the month will be used, where applicable, as the power factor for each of the separate classes. (c) Except as it is otherwise specifically provided in this contract, no adjustment will be made for power factor at any point of delivery described in this contract while the varhours delivered at such point are not measured. 7 (d) The Transferor may but shall not be obligated to, deliver electric energy hereunder at a power factor of less than 0.85 leading or lagging. 17. Permits. (a) If any equipment or facilities associated with any Point of Delivery and belonging to a party to this contract are or are to be located on the property of the other party, a permit to install, test, maintain, inspect, replace, repair, and operate during the term of this contract and to remove such equipment and facilities at the expiration of said term, together with the right of entry to said property at all reasonable times in such term, is hereby granted by the other party. (b) Each party shall have the right at all reasonable times to enter the property of the other party for the purpose of reading any and all meters mentioned in this contract which are installed on such property. (c) If either party is required or permitted to install, test, maintain, inspect, replace, repair, remove, or operate equipment on the property of the other, the owner of such property shall furnish the other party with accurate drawings and wiring diagrams of associated equipment and facilities, or, if such drawings or diagrams are not available, shall furnish accurate information regarding such equipment or facilities. The owner of such property shall notify the other party of any subsequent modification which may affect the duties of the other party in regard to such equipment, and furnish the other party with accurate revised drawings, if possible. 18. Ownership of Facilities. (a) Except as otherwise expressly provided, ownership of any and all equipment, and of all salvable facilities installed or previously installed by a party to this contract on the property of the other party shall be and remain in the installing party. (b) Each party shall identify all movable equipment and all other salvable facilities which are installed by such party on the property of the other by permanently affixing thereto suitable markers plainly stating the name of the owner of the equipment and facilities so identified. Within a reasonable time subsequent to initial installation, and subsequent to any modification of such installation, representatives of the parties shall jointly prepare an itemized list of said movable equipment and facilities. 19. hljustment for Change of Conditions. If changes in conditions hereafter occur wtTh substance ally affect any factor required by this contract to be used in determining (a) any credit in any exchange energy account to be made, money compensation to be paid, or amount of electric power and energy or losses to be made available to one party by the other party, or (b) any maximum replacement demand, or average power factor mentioned in this contract, such factor will be changed in an equitable manner which will conform to such changes of 'condi ti ons. If an increase in the capacity of the facilities being used by the Transferor in making deliveries hereunder is required at any time after execution of this contract to enable the Transferor to make the deliveries herein required together with those required for its own operations, the construction or installation of additional or other 8 equipment or facilities for that purpose shall be deemed to be a change of conditions within the meaning of the preceding sentence. If, pursuant to the terms of agreement establishing such exchange energy account, another rate is substituted for the rate to be used in settling the balance in such account, the number of kilowatthours to be credited to the Transferor in such account for each month as provided in this agreement, shall be changed for each month thereafter to the amount computed by multiplying such number of kilowatthours by 2.5 mills and dividing the resulting-product by the currently effective substituted rate in mills per ki 1 owatthour. 20. Dispute Resolution and Arbitration. (a) Pending resolution of a disputed matter the parties will continue performance of their respective obligations pursuant to this contract. If the parties cannot reach timely mutual agreement on any matter in the administration of this contract Bonneville shall, unless otherwise specifically provided for in subsection (b) below and, to the extent necessary for its continued performance, make a determination of such matter without prejudice to the rights of the other party. Such determination shall not constitute a waiver of any other remedy belonging to the Contractor. (b) The questions of fact stated below shall be subject to arbitration. Other questions of fact under this contract may be submitted to arbitration upon written mutual agreement of the parties. The party calling for arbitration shall serve notice in writing upon the other party, setting forth in detail the question or questions to be arbitrated and the arbitrator appointed by such party. The other party shall, within 10 days after the receipt of such notice, appoint a second arbitrator, and the two so appointed shall choose and appoint a third. In case such other party fails to appoint an arbitrator within said 10 days, or in case the two so appointed fail for 10 days to agree upon and appoint a third, the party calling for the arbitration, upon 5 days' written notice delivered to the other party, shall apply to the person who at the time shall be the presiding judge of the United States Court of Appeals for the Ninth Circuit for appointment of the second and third arbitrator, as the case may be. The determination of the question or questions submitted for arbitration shall be made by a majority of the arbitrators and shall be binding on the parties. Each party shall pay for the services and expenses of the arbitrator appointed by or for it, for its own attorney fees, and for compensation for its witnesses or consultants. All other costs incurred in connection with the arbitration shall be shared equally by the parties thereto. The questions of fact to be determined as provided in this section shall be limited to: (1) the determination of the measurements to be made by the parties hereto pursuant to section 4; (2) the correction of the measurements to be made pursuant to section 7; 9 (3) the duration of the interruption or equivalent interruption in section 14; (4) whether changes in conditions mentioned in section 19 have dreurred; (5) whether the changes mentioned in section 30 were made "promptly (6) whether an increase or decrease in load or change in load factor mentioned in section 32 is unusual; (7) any issue which both parties agree is an issue of fact mentioned in sections 30, 31, and 34; (8) the occurrence of an abnormal nonrecurring demand and the amount and time thereof; (9) whether a party has complied with section 34(b); and (10) the acceptable level of harmonics for purposes of section 35. 21. Contract Work Hours and Safety Standards. This contract, if and to the extent required by applicable law and if not otherwise exempted, is subject to the following provisions: (a) Overtime Requirements. No Contractor or subcontractor contracting for any part or the contract work which may require or involve the employment of laborers or mechanics, shall require or permit any laborer or mechanic in any workweek in which such worker is employed on such work to work in excess of 8 hours in any calendar day or in excess of 40 hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one -half times such worker's basic rate of pay for all hours worked in excess of eight hours in any calendar day or in excess of 40 hours in such workweek, as the case may be. (b) Violation; Liability for Unpaid Wages; Liquidated Damages. In the event of any v� ti on of the provisions of subsecti on a), the ZEntractor and any subcontractor responsible therefor shall be liable to any affected employee for such employee's unpaid wages. In addition, such contractor and subcontractor shall be liable to the Government for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic employed in violation of the provisions of subsection (a) in the sum of *10 for each calendar day on which such employee was required or permitted to be employed in such work in excess of eight hours or in excess of such employee's standard workweek of 40 hours without payment of the overtime wages required by subsection (a) above. (c) Withholding for Unpaid Wages and Liquidated Damages. Bonneville may withhold or cause to be withheld, from any moneys payable on account of work performed by the Contractor or subcontractor, such sums as may administratively be determined to be necessary to satisfy any liabilities of such Contractor or subcontractor for unpaid wages and liquidated damages as provided in subsection (b) above. (d) Subcontracts. The Contractor shall insert in any subcontracts the clauses set fortn in subsections (a) through (c) of this provision and also a clause requiring the subcontractors to include these'clauses in any lower tier subcontracts which they may enter into, together with a clause requiring this insertion in any furthersubcontracts that may in turn be made. (e) Records. The Contractor shall maintain payroll records containing the information specified in 29 CFR 516.2(a). Such records shall be preserved for 3 year from the completion,of the contract. 22. Convict Labor. In connection with the performance of work under this contract, the Contractor agrees, if and to the extent required by applicable law or if not otherwise exempted, not to employ any person undergoing sentence of Imprisonment except as provided by Public Law 89 -176, September 10, 1965 (18 U.S.C. 4082(c)(2)) and Executive Order 11755, December 29, 1973. 23. Equal Employment 1nent Opportunity_. During the performance of this contract, and to the extent required by applicable law or if nit otherwise exempted, the Contractor agrees as follows: (a) The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post in conspicuous places, available to employees and applfcants for employment, notices to be provided by Bonneville setting forth the provisions of the Equal Opportunity clause. (b) The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin. (c) The Contractor will send to each labor union or representative of workers with which said Contractor has a collective bargaining agreement or other contract or understanding, a notice, to be provided by Bonneville, advising the labor union or worker's representative of the Contractor's commitments under this Equal Opportunity clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment. (d) The Contractor will comply with all provisions of Executive Order No.•11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. (e) The Contractor will furnish all information and reports required by Executive Order No. 11246 of September 24, 1965,4nd by the rules, regulations, and relevant orders of the Secretary of Labor, or pursuant 11 thereto, and will permit access to said Contractor's books, records, and accounts by Bonneville and the Secretary of Labor for purposes of investigations to ascertain compliance with such rules, regulations, and orders. (f) In the event of the Contractor's noncompliance with the Equal Opportunity clause of this contract or with any of such rules, regulations, or orders, this contract may be cancelled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order No. 11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order No. 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law. (g) The Contractor will include the provisions of paragraphs (a) through (f) in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order No. 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as Bonneville may direct as a means of enforcing such provisions, including sanctions for noncompliance. In the event the Contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by Bonneville, the Contractor may request the.Government to enter into such litigation to protect the interests of the Government. 24. Additional Provisions. The Contractor agrees to comply with the clauses tor tovernment contracts contained in the following statutes, Executive Orders, and regulations to the extent applicable: (a) the Rehabilitation Act of 1973, Public Law 93 -112, as amended, and 41 CFR 60 -741 (affirmative action for handicapped workers); (b) the Vietnam Era Veterans Readjustment Assistance Act of 1974, Public Law 92 -540, as amended, and 41 CFR 60 -250 (affirmative action for disabled veterans and veterans of the Vietnam era); (c) Executive Order 11625 and 41 CFR 1- 1.1310 -2 (utilization of minority business enterprises); (d) the Small Business Act, as amended. 25. Reports. The other party to this contract will furnish Bonneville such information as is necessary for making any computation required for the purposes of this contract, and the parties will cooperate in exchanging such additional information as may be reasonably useful for their respective operations. 26. Assigqment of Contract. This contract shall inure to the benefit of, and shall The o upon the respective successors and assigns of the parties to this contract. Such contract or any interest therein shall not be transferred or assigned by either party to any party other than the Government or an agency thereof without the written consent of the other except as 12 specifically provided in this section. The consent of Bonneville is hereby given to any security assignment or other like financing instrument which may be required under terns of any mortgage, trust, security agreement or holder of such instrument of indebtedness made by and between the Contractor and any mortgagee, trustee, secured party, subsidiary of the Contractor or holder of such instrument of indebtedness, as security for bonds of other indebtedness of such Contractor, present or future; such mortagagee, trustee, secured party, subsidiary, or holder may realize upon such security in foreclosure or other suitable proceedings, and succeed to all right, title, and interests of such Contractor. 27. Waiver of Default. Any waiver at any time by any party to this contract omits rights with respect to any default of any other party thereto, or with respect to any other matter arising in connection with such contract, shall not be considered a waiver with respect to any subsequent default or matter. 28. Notices and Computation of Time. Any notice required by this contract to oe given to any party snail be effective when it is received by such party, and in computing any period of time from such notice, such period shall commence at 2400 hours on the date of receipt of such notice. 29. Interest of Member of Congress. Congress, or Resident Commissioner shall this contract or to any benefit that may shall not be construed to extend to this for its general benefit. 13 No Member of, or Delegate to be admitted to any share or part of arise therefrom, but this provision contract if made with a-corporation APPLICABLE ONLY IF TRANSFEREE IS A PARTY TO THIS CONTRACT 30. Balancing Phase Demands. If required by the Transferor at any time during the term of this contract, the Transferee shall promptly make such changes as are necessary on its system to balance the phase currents at any Paint of Delivery so that the current of any one phase shall not exceed the current on any-other phase at such point by more than 10 percent. 31. AdJustment for Unbalanced Phase Demands. If the Transferee fails to promptly maze tne changes mentioned in section J0, the Transferor may, after giving written notice one month in advance, determine that the Measured Demand of the Transferee at the Point of Delivery in question during each month thereafter, until such changes are made, is equal to the product obtained by multiplying by three the largest of the Integrated Demands on any phase adjusted as appropriate to such point during such month. 32. Changees in Requirements or Characteristics. The Transferee will, whenever possible, give reasona5e notice tothe transferor of any unusual increase or decrease of its demands for electric power and energy on the Transferor's system, or of any unusual change in the load factor or-power factor at which the Transferee will take delivery of electric power and energy under this contract. 33. Inspection of Facilities. Each party may for any reasonable purpose under this contract inspect tne other party's electric installation at any reasonable time. Such inspection, or failure to inspect, shall not render such party, its officers, agents, or employees, liable or responsible for any injury, loss, damage, or accident resulting from defects in such electric installation, or for violation of this contract. The inspecting party shall observe written instructions and rules posted in facilities and such other necessary instructions or standards for inspection as the parties agree to. Only those electric installations used in complying with the teens of this contract shall be subject to inspection. 34. Electric Disturbances. (a) For the purposes of this section, an electric disturbance is any sudden, unexpected, changed, or abnormal electric condition occurring in or on an electric system which causes damage. (b) Each party shall design, construct, operate, maintain and use its electric system in conformance with accepted utility practices: (1) to minimize electric disturbances such as, but ,ot limited to, the abnormal flow of power which may damage or interfere with the electric system of the other party or any electric system connected with such other party's electric system; and (2) to minimize the effect on its electric system and on its customers of electric disturbances Originating on its own or another electric system. (c) If both parties to this contract are parties to the Western Interconnected Electric System Agreement, their relationship with respect to system damages shall be governed by that Agreement. (d) During such time as a party to this contract is not a party to the Agreement Limiting Liability Among Western Interconnected Systems, its relations with the other party with respect to system damages shall be governed by the following sentence, notwithstanding the fact that the other party may be a party to said Agreement Limiting Liability Among Western Interconnected Systems. A party to this contract shall not be liable to the other party for damage to the other party's system or facilities caused by an electric disturbance on the first party's system, whether or not such electric disturbance is the result of negligence by the first party, if the other party has failed to fulfill its obligations under subsection (b)(2) above. (e) If one of the parties to this contract is not a party to the Agreement Limiting Liability Among Western Interconnected Systems, each party to this contract shall hold harmless and indemnify the other party, its officers and employees, from any claims for loss, injury, or damage suffered by those to whom the first party delivers power not for resale, which loss, -injury or damage is caused by an electric disturbance on the other party's system, whether or not such electric disturbance results from the negligence of such other party, if such first party has failed to fulfill its obligations under subsection (b4(2) above, and such failure contributed to the loss, injury or damage. 14 (f) Nothing in this section shall be construed to create any duty to, any standard of care with reference to, or any liability to any person not a party to this contract. 35. Harmonic Control. Each party shall design, construct, operate, maintain and use its electric facilities in accordance with good engineering practices to reduce to acceptable levels the harmonic currents and voltages which pass into the other party's facilities. Harmonic reductions shall be accomplished with equipment which is specifically designed and permanently operated and maintained as an integral part of the facilities of the party which owns the system on which harmonics are generated. APPLICABLE ONLY IF TRANSFEREE IS NOT A PARTY TO THIS CONTRACT 36. Protection of the Transferor. Protection is or will be afforded to Bonneville or its Transferor under such of the following provisions and conditions as are specified in each contract executed or to be executed by Bonneville and each third party Transferee named in this contract: the power factor clause of the applicable Bonneville Wholesale Rate Schedule and the subject matter set forth in the General Contract Provisions under the following titles, namely: Adjustment for Unbalanced Phase Demands; Uncontrollable Forces; Continuity of Service; Changes in Demands or Characteristics; Electric Disturbances; Harmonic Control; Balancing Phase Demands; Permits; Ownership of Facilities; and Inspection of Facilities. RELATING TO RURAL ELECTRIFICATION ADMINISTRATION BORROWERS 37. Approval of Contract. If the Contractor borrows from the Rural Electrification Administration or any other entity under an indenture which requires the lender's approval of contracts, this contract and any amendment thereto shall not be binding on the parties thereto if they are not approved by the Rural Electrification Administration or such other entity. The Contractor shall notify Bonneville of any such entity. If approval is given, such contract or amendment shall be effective at the time stated therein. APPLICABLE ONLY IF BONNEVILLE IS THE TRANSFEROR 38. Equitable Adjustment of Rates. (a) Bonneville shall establish, periodically review and revise rates for the wheeling of electric power and /or energy pursuant to the terms of this contract. Such rates shall be established in accordance with applicable law. (b) As used in this section, the words "Rate Adjustment Date" shall mean any date specified by Bonneville in a notice of intent to file revised rates as published in the Federal Register; provided, however, that such date shall not occur sooner than (1) nine months 'mom EMI date that such notice of intent is published; or (2) twelve months from any previous Rate Adjustment Date. By giving written notice to the Contractor 45 days prior to such Rate Adjustment Date, Bonneville may delay such Rate Adjustment Date for up to 90 days if Bonneville determlines either that the revenue level of the proposed rates IC differs by more than five percent from the revenue requirements indicated by most recent repayment studies entered in the hearings record or that external events beyond Bonneville's control will prevent Bonneville from meeting such Rate Adjustment Date. Bonneville may cancel a notice of intent to file revised rates at any time (1) by written notice to the Contractor; or (2) by publishing in the Federal Register a new notice of intent to file revised rates which specifically cancels a previous notice. (c) The Contractor shall pay Bonneville for the service made available under this contract during the period commencing on each Rate Adjustment Date and ending at the beginning of the next Rate Adjustment Date at the rate specified in any rate schedule available at the beginning of such period for service of the class, quality, and type provided for in this contract, and in accordance with the terms thereof, and of the General Transmission Rate Schedule Provisions, if any, as changed with, incorporated in or referred to in such rate schedule. New rates shall not be effective on any Rate Adjustment Date unless they have been approved on a final or interim basis by a governmental agency designated by law to approve Bonneville's rates. Rates shall be applied in accordance with the terms thereof, the General Transmission Rate Schedule Provisions as changed with, incorporated in or referred to in such rate schedule and the terms of this contract. (WP PIGl -0222f 16 I A. Points of Interconnection. Points of Delivery. Transmission Demands. Use -of- Facilities Charges. and Resources. Approved Point Use -of- Resource(s) of Interconnection Transmission Facilities to be (Voltage) Demand Charge Integrated Government' Port Angeles Substation 69 kV Bay 26 Approved Point of Delivery Government's Port Angeles Substation 69 kV Bay 23 1/ Composite UFT charge based on Bay's 23 and 26. (VS6- PMT- 0758e) Transmission Parameters Exhibit C, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement 485 kW $.070 /kW -mo 1/ Morse Creek 8. Calculation of Charges Pursuant to the UFT -83 Rate Schedule: Facility Government's Port Angeles $160,631 Substation 69 kV Bay 26 Bay 23 I&A 2/ I&A O&M 1/ Sum of 1/ Annual Annual Annual Non Coincidental (Sponsor) Investment Cost Ratio Cost Cost Demand S /kW /vr. Demand I/ $152.752 9.24% 9.24% $14,842 5,377 35,085 kW $14,114 5,377 74,585 kW Exhibit C, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1988 0.58 485 kW 0.26 485 kW Total UFT Charge $0.840 /kW -yr. 4/ $0.070 /kW -mo. .1] 0&M charge based on low voltage terminal in 5 -1 -88 ACR table. 2/ Taken from 5 -1 -88 ACR table. 2/ J88 peak loads from Clallam (33.5) Eastern Morse Creek plus Port Angeles City 53.86 1 2. The City was prorated based upon J87 bill. 4/ Unit Charge jI&A Annual Cost) 0&M Annual Cost /kW yr. Sum of Non Coincidental Demands Monthly Charge SS /kW vr) Sponsor Demand) /mo. 12 months 5/ Ratchets shall be handled in accordance with section 5(c). (VS6- PMT- 0758e) Description of Project, Point of Interconnection, and Points of Delivery 1. MORSE CREEK HYDRO PROJECT (VS6- PMT- 0758e) Location: the project is located in the NW 1/4 of Section 29, T30N, R5W, Willamette Meridian, Clallam County, Washington; approximately 3 miles east of Port Angeles and 1 -1/2 to 2 miles south of state route 101 and primarily east of Glass Road; Demand: 485 kW; Voltage: 12.5 kV; Metering: in the City's powerhouse, in the 480 volt circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for transformation losses between the Project point of metering and the high side of the Project transformer. 2. MORSE CREEK POINT OF INTERCONNECTION Location: A point on the Utility's distribution line approximately one half mile from the Morse Creek Hydro Project at the junction of Glass and Boyd Roads where the distribution lines of the Utility and the line from the City's Project interconnect; Voltage: 12.5 kV; Adjustments: there shall be an adjustment for transmission losses between the Morse Creek Hydro Project and the Morse Creek Point of Interconnection. 3. PORT ANGELES POINT OF INTERCONNECTION Voltages: 69 kV; Exhibit D, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement Location: the point in Bay 26 (Clallam Co. PUD's Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the Utility and the Government are connected; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for distribution losses between the Utility's Morse Creek Point of Interconnection and the Government's Port Angeles Point of Interconnection. 4. PORT ANGELES POINT OF DELIVERY Location: the point in Bay 23 (Port Angeles Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the City and the Government are connected; Voltaaes: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be no adjustment for losses between the Point of Interconnection and the Point of Delivery. (VS6- PMT- 0758e) Exhibit D, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement (VS6- PMT- 0758e) Loss Factors Exhibit E, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement The losses specified in Exhibit D under Points of Interconnection and Points of Delivery shall consist of two components. The first is the transformation and transmission losses from the Project to the Morse Creek Point of Interconnection, and the second is the transmission and transformation losses from the Morse Creek Point of Interconnection to the Port Angeles Point of Interconnection. No losses shall be applied between the Port Angeles Point of Interconnection and the Port Angeles Point of Delivery as specified in Exhibit D. The losses between the Project Point of Metering and the Port Angeles Point of Interconnection shall be submitted to the City and the Utility by Bonneville by separate letter. The revision of these losses shall be as specified in section 7(c). Resource service charges shall be incorporated into Exhibit F as developed by Bonneville according to section 7(d) of this agreement. As of the Effective Date of this Agreement, the Resource service charge is zero. (VS6- PMT- 0758e) Resource Services Exhibit F, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Effective at 2400 hours on the Effective Date of this Agreement IA- TRANSMISSION AGREEMENT FOR MORSE CREEK HYDROELECTRIC PROJECT BETWEEN THE CITY OF PORT ANGELES AND PUBLIC UTILITY DISTRICT NO. 1 OF CLALLAM COUNTY THIS AGREEMENT is by and between the City of Port Angeles, hereinafter referred to as "City and Public Utility District No. 1 of Clallam County, -hereinafter referred to as "District municipal corporations organized and existing under the laws of the State of Washington; WITNESSETH: WHEREAS, the City is constructing the Morse Creek Hydroelectric Project, hereinafter referred to as "Project and WHEREAS, the District is willing to provide firm electric transmission capacity on its distribution facilities for the transmission of power from the Project to the District's point of interconnection with the Bonneville Power Administration, hereinafter referred to as "Bonneville in Bonneville's Port Angeles Substation; and WHEREAS, the City is willing to provide firm water transmission capacity on its water transmission line for wheeling the District's water from the City's diversion to the District's water treatment plant; and WHEREAS, the City, District, and United States of America, Department of Energy, acting by and through Bonneville will enter into an agreement concerning the Morse Creek Hydroelectric Project, hereinafter referred to as Exhibit "A and WHEREAS, it is the intent of both parties to minimize costs that occur with performing the services associated with implementing this agreement; and -1- LI0060 [2] Whereas, the District has provided electrical transmission on its distribution facilities for the transmission of power from the Project to the District's point of interconnection for the City on an interim basis pending execution of this Agreement; NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Purpose. The District will transmit electrical energy for the City and the City will wheel water for the District as provided for herein. The .parties have determined that the exchange of services hereunder have equivalent value at the present time. 2. Term. a) This Agreement shall be effective commencing at 2400 hours on the date of execution and shall continue for twenty (20) years. b) Upon completion of five (5) years and every five (5) years thereafter, and also if any part of this Agreement is finally adjudicated as being invalid or unenforceable, the parties agree to cooperatively review operating experience in order to identify inequities, if any. Said review shall be completed within three (3) months; if the parties agree, each party shall then implement corrective and /or mitigating action on jointly identified problems within one (1) year. However, if the parties cannot agree (1) that there are inequi- ties, or (2) on the method of implementing mitigation, then either party may make written demand for arbitration which shall be done as follows: Each party shall select an arbitrator within twenty (20) days of the written notice. The arbitrators shall meet and select a third arbitrator within thirty (30) days of the written notice. If the arbitrators cannot agree on the third arbitrator, either party may apply to the Superior Court of Clallam County requesting the Superior Court to select an arbitrator. Within fifteen (15) days of the selection of the third arbitrator, the arbitrators shall meet and conduct a hearing and take evidence from both parties. They shall determine -2- LI0060[2] from all of the evidence (1) whether or not the relative obligations under the contract are or have become inequitable, and if they have, (2) the nature and extent of the mitigation. Each party shall pay the cost of its own arbitrator and one -half the costs of the third. The award of the arbitration panel shall be final. c) Upon termination of either the City's Hydroelectric Project or the District's water treatment plant, the owner of the terminated facility may terminate this Agreement if twelve (12) months' written notice has been given to the other party. d) Either party shall have an option to extend this Agreement for an additional twenty (20) years under the same terms and conditions as this Agree- ment or any modifications of it as provided for herein, so long as the party requesting the extension has cured any of its defaults that may have occurred. 3. Transmission of Electric Power and Energy a) For each hour during the term hereof, the District shall make available to Bonneville at the District's point of interconnection, as described in Exhibit "A" (Contract No. DE- MS79- 88BP92315 as amended, extended or replaced), which will be attached to this Agreement when in final form and executed by all parties, for the account of the City, the amounts of electric energy generated at the Project, less system losses. The District will not be required to provide such energy under the conditions described in Sections 7 and 8 herein. b) (1) The District agrees that it will schedule for the months of September and October planned routine operations and maintenance that would prevent it from making delivery at the District's point of interconnection and give forty -eight hours notice thereof to the City. (2) The City agrees that the District may, for emergencies, choose not to make delivery at the District's point of interconnection outside the months of September and October. If the District exercises this option, it shall give the City notice thereof with the reason therefor. Upon such notice, the City will attempt to make other wheeling arrangements satisfactory to the -3- LI0060 [2] City and the District. If such arrangements cannot be made, the City's obligation to wheel water is suspended 24 hours after interruption until such time as delivery at the District's point of interconnection is resumed. c) Wheeling charges or other fees related to the transmission of Project output, from the Project powerhouse to Bonneville's Port Angeles Substation, will not be charged to the City by the District while this Agreement is in effect, except as changed per Section 2(b). d) The City will construct and maintain an underground power line from the powerhouse to the junction of the Boyd and Glass Roads where it will interconnect with the distribution facilities of the District. The District shall upgrade to three phase its existing electric power line from the point of interconnection at the corner of Glass and Boyd Roads to that point on the Mount Pleasant Road where the existing three phase facilities terminate. The City will reimburse the District for the cost of the upgrade at that cost but not to exceed $25,000. The City will own and maintain the underground cable and inter- connection switch. Ownership, maintenance, and operation of the overhead line are the responsibility of the District. 4. Meter Reading and Billing a) The City shall install a recording meter at the Project power- house. Meters installed at the Project shall have telecommunication to Bonne ville's remote metering system. Pursuant to Exhibit "A Bonneville will adjust the computations for the District's and the City's Port Angeles delivery points by the corresponding energy and hourly capacity output, as detailed in that agreement. b) The City will provide space and metering pulses in the Powerhouse for the District to meter the Project output. 5. Transmission of Water a) The District will amend the point of withdrawal for its water right from Morse Creek to include the City's Morse Creek diversion site, herein- after referred to as "Diversion Site The City shall wheel up to 11 CFS of -4- LI0060[2] water at no charge from the Diversion Site to the District's existing water treatment plant; provided that in no event shall the District withdraw more than 11 CFS. After initial installation, no modifications or changes to the District's pipes, valves or pump which connect to the City's main will be made that would increase the District's capability to withdraw water without prior written City approval. The City may inspect the District's water treatment plant and plant records, upon request, to verify this limit. b) The City shall furnish and install a 24" butterfly valve and tap with an 8" gate valve on its water transmission line near the District's water treatment plant. The District will reimburse the City for the cost of installa- tion of the valves and the tap. The City will own and maintain the butterfly valve, tap and 8" gate valve. The District will own and maintain the water pipe connected to the gate valve. c) The City shall continue to wheel 11 CFS of water at no charge in the event the Project powerhouse is not in operation, except as provided in the Project's FERC license, or Sections 7 and 8 herein, or as modified by Section 2. 6. Provision of Electric Service. a) Electric service at the City's Diversion Site will be metered and billed in accordance with the District's rate schedule for like service to other customers. b) Electric service at the Project powerhouse will be provided by the Project generation when operating and by the District when the Project is shut down. In consideration of the obligations of this Agreement, the District will not charge the City for energy provided by the District when the Project's generator is not operating. 7. Maintenance of Facilities and Liability a) Each party, at its expense, will maintain its facilities used under this Agreement in accordance with prudent utility practice and will keep such facilities in continuing good operating condition, except as provided elsewhere in this Agreement; provided, however, that neither party shall be -5- LI0060[2] liable to the other hereunder for any interruption, suspension, curtailment, or fluctuation in the power and energy or water to be transferred hereunder (1) caused by the necessity of making repairs or changes in facilities used for such transfer, or (2) by reason of any cause beyond either party's reasonable con- trol, including but not limited to the following: fire, ice, flood, winds, earthquakes, volcanoes, acts of the elements, court orders, insurrections or riots, generation failures, breakdown of or damage to facilities of the parties or of third parties, acts of God or War or public enemy, strikes or other labor disputes, civil, military or governmental authority. b) In the event of blockage at the Diversion Site such that water cannot be wheeled without continuing expenditures of labor, material and /or equipment cost, the City may, after twenty -four (24) continuous hours of such expenditures exercise the option to shut down the Diversion Site unless the District provides the necessary labor, equipment, material, or financial assis- tance to keep the Diversion Site clear and operational. This option may only be exercised if such continuing expenditures make the project generation not cost effective to the City as determined by the City. c) Attached to this Agreement, and incorporated herein as Exhibit "B are operating procedures (two pages) and drawings (two pages) which show the facilities owned and operated by the City and the facilities owned and operated by the District as relate to this Agreement. The parties shall operate their respective facilities in accordance with Exhibit "B d) The City will design and operate the Project's electrical genera- tion output and deliver it to the District in such a manner that no electrical degradation or disturbance to the District's system shall occur and further, the energy delivered will conform with paragraph 4(a) of Exhibit "A e) The parties are not joint tenants, partners, joint operators, or joint venturers. Neither party is empowered to act as agent for the other. -6- LI0060[2) 8. Emergency Suspension It is understood and agreed that, in the event either party determines that an emergency exists requiring full capacity of its own water or electric facilities, that party may send written notice of such emergency to the other party. Upon sending such a notice, this Agreement shall be suspended until such time as the emergency has ended. The emergency must have the element of an unexpected and unplanned -for event; provided that the temporary loss or failure of the Elwha water supply system shall constitute an unexpected, unforeseeable circumstance under this section. Normal growth in demand, usage, or customers .shall not constitute an emergency. Invocation of this paragraph shall not constitute a breach of the contract and all remaining agreements under the contract shall continue in full force and effect after the period of suspension. 9. Liability for Negligent Conduct Each party to this Agreement hereby agrees to waive any claim, and to hold the other harmless, for any damage or injury suffered by it, which is not the result of the sole negligence of the other party. However, liability for injuries to third persons and their property shall be apportioned on the basis of the relative fault of the contracting party. The right of contribution is preserved under these circumstances and may be enforced by separate action. This Agreement may be enforced by action at law and for specific performance if the court deems such relief to be appropriate. 10. Integration and Amendments This Agreement, Exhibit "A" referred to in Sections 3(a), 4(a) and 7(d), and Exhibit "B referred to in Section 7(c), constitute the entire agreement between the parties. No oral agreement or prior written agreement between the parties shall be of any effect whatsoever; provided, however, that any amendments agreed upon in writing by the parties and consistent with this Agreement shall be binding upon the parties. All amendments to this Agreement and to exhibits hereto shall be in writing and signed by an authorized repre- sentative of each party. -7- LI0060[2] 11. Non waiver None of the provisions of this Agreement shall be considered waived by either party, except when such waiver is given in writing. The failure of either party to insist in any one or more instances upon strict performance of any of the provisions of this Agreement or to take advantage of any of its rights hereunder shall not be construed as a waiver of any such provisions or the relinquishment of any such rights for the future, but the same shall con- tinue and remain in full force and effect. 12. Successors and Assigns a) This Agreement shall be binding upon and provide benefits to the respective successors and assigns of the parties. b) No assignment of this Agreement or any part thereof by either party shall be valid, unless approved in writing in advance by the other party and until the obligations so assigned have been assumed by the assignee. Such approvals of assignment shall not be unreasonably withheld. 13. Effect of Section Headings Section headings appearing in this Agreement are inserted for con- venience only and shall not be construed as interpretation of text. 14. Governing Law This Agreement shall be interpreted, governed, and construed under the laws of the State of Washington, as if executed and to be performed wholly within the State of Washington. 15. Validity of Contract In the event any section, sentence, clause, phrase, or exhibit of this Agreement shall be adjudicated by a court of last resort and of competent juris- diction to be invalid or illegal, the remainder of this Agreement shall be unaf- fected by such adjudication, and all other provisions of this Agreement shall remain in full force and effect as though the section, sentence, clause, phrase, or Exhibit so adjudicated to be invalid had not been included herein. -8- LI0060[2} 16. Notices Any notice, or other communication required under this Agreement shall be effective from the date received by the party to whom it is given. Except as otherwise specifically provided herein, any notice from one party to the other shall be given to the following designees, or to such others as may be herin- after designated by either party: ATTEST: BY: TITLE: ATTEST: BY: TITLE: The City of Port Angeles City Light Department P.O. Box 1150, 240 W. Front Port Angeles, WA 98362 Attn: City Light Director 17. The parties hereto acknowledge that the District has provided electric transmission over its distribution fcilities for the transmission of power from the Project to the District's point of interconnection commencing at 2400 hours June 11, 1987, and continuing until the effective date of this Agreement. Payment, or like arrangements for this service, has been made in full. IN WITNESS WHEREOF, the parties hereto have executed this Agreement. Superintendent City Clark P.U.D. No. 1 of Clallam County P.O. Box 1117, 2419 Highway 101 E. Port Angeles, WA 98362 Attn: Manager P.U.D. No. 1 of Clallam County BY: TITLE: Manager DATE: FPhrnary 7 l City of Port Angeles BY: TITLE: DATE: BY: DATE: Mayor February 2, 1988 TITLE: City Light Director February 2, 1988 -9- LI0060[2] 11. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in several counterparts. By Date CLALLAM COUNTY PUD ATTEST: By By Title Title Date Date CITY OF PORT ANGELES ATTEST: By By Title Title Date Date (VS6- PMT- 0758e) 10 UNITED STATES OF AMERICA Department of Energy Bonneville Power Administrtion CITY LiGHO February 4, 1988 George Reich Bonneville Power Administration P.O. Box 3621 Portland, OR 97208 Dear George: CITY OF PORT ANGELES 240 WEST FRONT ST P 0 BOX 1150 PORT ANGELES, WASHINGTON 98362 PHONE (206) 457 -0411 Attached find an authenticated copy of the City Council minutes of February 2nd, 1988 that authorize the City Light Director, Robert Orton to sign the City of Port Angeles /Clallam County PUD Morse Creek Transmission Agreement. Also find attached an authenticated copy of the City /PUD Morse Creek Transmission Agreement. There are two originals of this contract one in the City Clerk's Office and the other I hand delivered to Clallam County PUD. Should Bonneville require an authenticated copy of the minutes of the PUD Commission meeting that authorize their signature, please contact Mike McInnis at Clallam County PUD. I look forward to receiving three originals of the City /BPA /PUD Morse Creek Transmission Agreement in the near future. Please note the attached authenticated copy of the Council minutes also authorizes the City Light Director to sign the City /BPA /PUD Agreement. After the City signs the final agremeent I will transmit them to Clallam County PUD for their signature and return to Bonneville for the Admin- istrator's signature. Bonneville will then send one original to Clallam County PUD and one to the City of Port Angeles. Thank you for your coopertion in this matter both now and in the past. Very truly yours, es'5 dow Richard French Morse Creek Project Manager Engineering Operations Manager RF /dp cc: Rob Orton, City Light Director Mike McInnis, Clallam PUD Attachments: (2) 5,2i'1 STATE OF WASHINGTON ss County of Clallam I, the undersigned City Clerk of the City of Port Angeles, Washington, do hereby certify that the hereto attached "City Council Meeting Minutes of February 2, 1988 and Transmission Agreement for the Morse Creek Hydroelectric Project between the City of Port Angeles and Public Utility District No. 1 of Clallam County" is a true and correct copy of the document (s) indicated above. WITNESS my hand and official seal this 18th day of February 1988 n o 1C; J Acting City Clerk of the City of Port Angeles, Washington STATE OF WASHINGTON ss County of Clallam I, the undersigned City Clerk of the City of Port Angeles, Washington, do hereby certify that the hereto attached signature g page for Transmission Agreement for the Morse Creek Hydroelectric Project between the City of Port Angeles and Public Utility District No. 1 of Clallam County is a true and correct copy of the document (s) indicated above. WITNESS my hand and official seal this 25th day of February 19 88. City Clerk of the City of Port Angeles, Washington Contract No. DE- MS79- 88BP92315 oR dipr TRANSMISSION AGREEMENT executed by the UNITED STATES OF AMERICA DEPARTMENT OF ENERGY acting by and through the BONNEVILLE POWER ADMINISTRATION and CLALLAM COUNTY PUD and CITY OF PORT ANGELES MORSE CREEK HYDRO PROJECT Index to Sections 01/05/88 5 2, Section Page 1. Term of Agreement 3 2. Definition and Explanation of Terms 3 3. Exhibits; Interpretations 4 4. Transmission of Electric Power and Energy 4 5. Payment Provisions 6 6. Termination of Agreement and Charges 6 7. Revision of Exhibits 8 8. Reactive Power 9 9. Metering Equipment 9 10. Several Obligations 10 11. Execution in Counterpart 10 Section Page-- Exhibit A (Transmission Rate Schedules and Y 1 General Transmission Rate Schedule Provisions) 4 Exhibit B (General Wheeling Provisions [GWP Form -4R]) 4 Exhibit C (Transmission Parameters) 4 Exhibit D (Project, Point of Interconnection, Point of Delivery) 4 Exhibit E (Loss Factors) 4 Exhibit F (Resource Services) 4 This TRANSMISSION AGREEMENT, executed 19_, by the UNITED STATES OF AMERICA (Government), Depart t4itirgy, acting by and through the BONNEVILLE POWER ADMINISTRATION (Bonneville), CLALLAM COUNTY PUD (Utility), a Public Utility District of the State of Washington, and the CITY OF PORT ANGELES (CITY), a municipality of the State of Washington; W I T N E S S E T H WHEREAS the Utility and the City have entered into, or intend to enter into, an agreement whereby the Utility will provide firm capacity in its transmission or distribution system facilities for the transmission of electric power generated at the Morse Creek Hydro Project (Project), and for interconnection of the Project to the facilities of the Utility (Interconnection Agreement); and WHEREAS the Utility and Bonneville have agreed to provide firm capacity on their transmission or distribution facilities for the transmission of power from the Project to the City; and WHEREAS the City owns the Project and the transmission service occurs over the Utility's and Bonneville's facilities for delivery to the City; and WHEREAS the load which is served hereunder at the Point of Interconnection 2 and the Point of Delivery is in the control area of Bonneville; and WHEREAS Bonneville is authorized pursuant to law to dispose of electric power generated at various Federal hydroelectric projects in the Pacific Northwest, or acquired from other resources, to construct and operate transmission facilities, to provide transmission and other services, and to enter into agreements to carry out such authority; NOW, THEREFORE, the parties hereto mutually agree as follows: 3 1. Term of Agreement. This agreement shall be effective cdMmeticingat 2400 hours on the date Bonneville has signed all original counterparts of agreement (Effective Date), and unless terminated earlier pursuant to the terms of this Agreement, shall continue until 2400 hours on January 31, 2008. All obligations incurred hereunder shall continue until satisfied. Upon expiration of this agreement, Bonneville shall offer to extend transmission services provided hereunder, subject to the terms and conditions consistent with the then prevailing Bonneville rates, policy, and Federal Columbia River Transmission System (FCRTS) conditions. 2. Definition and Explanation of Terms. (a) "Electric Power" or "power" means electric peaking capacity, expressed in kilowatts, or electric energy expressed in kilowatthours, or both. (b) "Point of Delivery" means the point of delivery, described in Exhibit D, where electric power and energy are delivered to the City by Bonneville. (c) "Point of Interconnection" means the point described in Exhibit D where the project output will be made available by the Utility to Bonneville. (d) "Project" means the City's Morse Creek Hydro Project facility, described in Exhibit D, consisting of the site and generating units, and related transformation and transmission facilities. (e) "Transmission Demand" means the amount specified in Exhibit C, expressed in kilowatts, which is the maximum hourly amount of electric energy to be made available to the City under this agreement at the Point of Delivery. (f) "Use -of- Facilities Charge" means the charge specified in Exhibit C, which is the monthly charge per kilowatt of Transmission Demand for the Point of Delivery; such charge has been calculated pursuant to the provisions of Exhibit A. 3. Exhibits; Interpretations. The rights and obligations of the parties with respect to provisions hereunder shall be subject to and governed by this agreement, including Exhibits A through F (Exhibits) attached hereto and by this reference made a part of this agreement. The provisions of section 38 of the General Wheeling Provisions [GWP Form -4R], Exhibit B, requires a minimum notice prior to a Rate Adjustment Date. If the rates are disapproved or conditions are placed on them by the agency authorized to approve Bonneville's transmission rates (Agency) or by any judicial interpretation of legislation by a court with jurisdiction over Bonneville, Bonneville shall not be required to give the minimum notice prior to resubmitting the rates to the Agency or implementing the Agency approved rates. The headings used in this agreement are for convenient reference only, and shall not affect the interpretation of this agreement. The City shall be the "Transferee" and the Utility and Bonneville shall be the "Transferor" referred to in the General Wheeling Provisions Exhibit. 4. Transmission of Electric Power and Energy. (a) Before power shall be made available to the City, all equipment and facilities needed for safe and reliable interconnection to Bonneville's facilities shall be installed by the City and in operation as approved by Bonneville. If at any time during the term of this agreement the existence of Project generation creates disturbances on or otherwise degrades the integrity of the Federal Columbia River Transmission System (FCRTS), Bonneville may interrupt transmission services and require the to install, or have installed at the City's expense, facilities necessary to correct such problems prior to resuming such services. In addition, Bonneville shall require use of its Revenue Metering System (RMS) meters in accordance with Section 9. (b) For each hour during the term hereof, the City shall make available or arrange to have made available to the Utility at the Utility's Morse Creek Point of Interconnection as defined in Exhibit D, and the Utility shall make available to Bonneville at the Government's Port Angeles Point of Interconnection as defined in Exhibit D, an amount of Electric Power metered at the Project less losses in accordance with Exhibit E. (c) For each hour during the term hereof, Bonneville shall make available 1' to the City at the Point of Delivery for account of the City, the amount of Electric Power made available to Bonneville pursuant to subsection (b). (d) Bonneville shall add to the metered quantities monthly at the Point of Interconnection and subtract from the metered quantities monthly at the Point of Delivery the amount of power made available to Bonneville pursuant to subsection (b) above. (e) Nothing contained in the power sales contract between Bonneville and the Utility (Contract No. DE- MS79- 81BP90488 as amended by Amendatory Agreement No 1, dated June 3, 1982) and Bonneville and the City (Contract No. DE- MS79- 81BP90450) shall limit in any way the obligations of Bonneville or the Utility to the City to provide the firm transmission services hereunder. 5 5. Payment Provisions. (a) The City shall pay Bonneville each month for the transmission services and the resource services provided hereunder, an amount which shall be the sum of the products obtained by multiplying each of the charges for such services by its respective multiplier. The charges and multipliers shall be as specified in Exhibit C. The resource services shall be developed and described pursuant to section 7(d). Bonneville shall make appropriate billing adjustments during periods, if any, when the operation of the Project is limited by governmental agencies having jurisdiction over air and water quality standards therefor. Any ratchet demand that may occur as determined by Bonneville pursuant to the Transmission Rate Schedules and General Transmission Rate Schedule Provisions, does not constitute an increase in any Transmission Demand approved by Bonneville, and any continued service at such level will depend on the availability of facilities as determined by Bonneville. (b) The City shall pay the Utility each month for the transmission services provided by the Utility hereunder as provided in the Interconnection Agreement. Such obligation is an obligation of the City. (c) To the extent that the billing determinants contained in Exhibit C include a demand factor, which may be represented by a "transmission demand," "contract demand," "measured demand" or other type of demand quantity, the billing demand and ratchet provisions, if any, of the General Transmission Rate Schedule Provisions contained in Exhibit A shall apply to the calculation of payments. 6. Termination of Agreement and Charges. This agreement may be terminated with mutual consent of the parties, which consent shall not be unreasonably withheld, (1) upon destruction or abandonment of the Project; 6 upon discontinuation of Project output under a final order of a public official having authority to issue such order; (3) upon termination of the Interconnection Agreement between the City and the Utility for the transfer of power for the Project; (4) upon denial of a license to construct and operate the Project from the Federal Energy Regulatory Commission (FERC) or its successor agency (Agency). The parties understand that the City has a preliminary notice to operate the Project commercially. If information provided pursuant to the FERC license for Project No. 6461 -001 infers that the Project should not operate because of adverse fishery impacts, then Bonneville may terminate this agreement. This agreement may not be terminated by reason of a partial reduction in generating capability. If this agreement is terminated earlier than the term described in section 1 above, or if there is a partial reduction in generating capability, the City shall pay Bonneville as follows: (a) for the unamortized nonsalvable investment plus the cost of removal of any facilities Bonneville has constructed at Government expense for the purpose of providing transmission service for the Project hereunder; or (b) monthly at a rate that shall compensate Bonneville for the annual cost of the facilities so constructed, to the extent such facilities become unusable in whole or in part as the result of such destruction or abandonment of the Project or upon such partial permanent reduction or discontinuation of Project Output. The payment obligations in this section shall be the obligation of the City. 7 7. Revision of Exhibits. (a) The Use -of- Facility Transmission rate schedule attached hereto as Exhibit A has been finally confirmed and approved by the Agency. The rate schedule in Exhibit A shall be replaced successor rate schedules in accordance with the provisions of section 7(i) of the Pacific Northwest Power Act and Agency rules. The Use -of- Facilities Charge specified in Exhibit C shall be recalculated following any rate filing according to the provisions of such amended, modified, or successor rate schedules and associated provisions, and Bonneville shall prepare a new Exhibit C incorporating the revised Use -of- Facilities Charge. (b) If Bonneville determines that the charges specified in Exhibit C or any subsequent charges specified in this agreement must be changed pursuant to sections 19 or 38 of Exhibit B, it shall prepare a new Exhibit C incorporating such changes. Such new Exhibit C shall be substituted for the Exhibit C then in effect and shall become effective as of the date specified therein. (c) The loss factor specified in Exhibit E may be revised from time to time upon notification by the City and Utility, or Bonneville's determination that conditions at the Project or on the Utility's system have changed sufficiently to warrant recalculating the loss factor. Bonneville shall calculate the new loss factor and submit to the City and Utility by letter pursuant to Exhibit E. (d) Exhibit F shall be revised to include charges for resource services which Bonneville provides for the Project or upon determination by Bonneville that any such resource service charge contained therein must be changed to properly compensate Bonneville for providing such services. The resource services may include, but shall not be limited to, such services as operating reserves and making available amounts of power and energy to the City, '8 pursuant to section 4(c) above, which vary from the amounts of actual Project generation. The resource service charge set forth in Exhibit F shall not be increased more frequently than once during any consecutive 12 month period. Bonneville shall provide the City and Bbnneville's other customers with a reasonable opportunity of not less than 90 days to comment prior to the effective date of such proposed revised charges. Revised charges shall take effect on the date specified by Bonneville in its written notice to the City of its intention to revise such charge. 8. Reactive Power. It is the intent of the parties hereto that the voltage level at the Points of Interconnection and the Points of Delivery be controlled in accordance with prudent utility operating practice. The parties hereto shall jointly plan and operate their systems so as not to place an undue burden on the other party to supply or absorb reactive power accompanying or resulting from deliveries hereunder. OR 9. Metering Equipment. Bonneville shall require use of a Revenue i Metering System (RMS) unit or like unit meeting Bonneville's specifications to meter output from the Project. Bonneville shall perform all O &M services on the RMS unit. Likewise, the City shall use JEM meters, or equivalent, to determine output from., the Project; and the City shall perform all 0 &M service on its meter. The cost associated with the purchase and maintenance of the RMS unit including repair or replacement shall be at the City's expense. The original purchase of the RMS unit is provided under Agreement No. DE- AI79- 87BP72149. Installation of telecommunications equipment for both Bonneville and City metering equipment and all service charges shall be at the City's expense. Ownership of the RMS equipment shall remain with the Government. 9 10. Several Obligations. Except where specifically stated in this agreement to be otherwise, the duties, obligations, and liabilities of the parties are intended to be several and not joint'or collective. Nothing contained in this agreement shall ever construed to create an association, trust, partnership, or joint venture or to impose a trust or partnership duty, obligation, or liability on or with regard to any party. Each party shall be individually and severally liable for its own obligation under this agreement. 11. Execution in Counterpart. This agreement may be executed in any number of counterparts in which case all such counterparts shall be deemed to constitute a single document with the same force and effect as if all parties hereto having signed a counterpart had signed all other counterparts. The agreement shall become effective in accordance with section 1. IN WITNESS WHEREOF, the parties hereto have executed this agreement in 10 i tim several counterparts. CLALLAM COUNTY PUD By q%N Title 4 Date CITY OF PORT ANGELES By II Title ,r/ Date (WP- PKT- 0758e) UNITED STATES OF AMERICA Department of Energy Bonneville Power Administration By Date ATTEST: By Title Date ATTEST: By Title Date 1 04) 4 i7 DRAFT Transmission Parameters Exhibit C, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement A. Points of Interconnection, Points of Delivery, Transmission Demands, Use -of- Facilities Charges, and Resources. Approved Point Use -of- Resource(s) of Interconnection Transmission Facilities to be (Voltage) Demand Charge Integrated Government' Port Angeles Substation 69 kV Bay 26 Approved Point of Delivery Government's Port Angeles Substation 69 kV Bay 23 485 kW $.082 /kW /mo 1/ Morse Creek 1/ Composite UFT charge based on Bay's 23 and 26. (WP- PKT- 0758e) i B. Calculation of Charges Pursuant to the UFT -83 Rate Schedule: I &A 2/ I &A 0 &M 1/ Sum of 3/ Annual Annual Annual Non Coincidental Cost Ratio Cost Cost Demand (Sponsor) Facility Investment Demand 5/ Government's Port Angeles 485 kW Substation 69 kV Bay 26 Bay 23 kW -mo. 485 kW Total UFT Charge kW -yr. 4/ (WP- PKT- 0758e) 0 $160,631 9.5? $152,752 9.5% 1/ 0 &M charge based on low voltage terminal in 2 -19 -87 0 &M costs table. 2/ Taken from 5 -15 -87 ACR table. 3/ J88 peak loads from Clallam (33.5) Eastern Morse Creek plus Port Angeles City 53.86 1 The City was prorated based upon J87 bill. 4/ Unit Charge (I &A Annual Cost) 0 &M Annual Cost /kW yr. Sum of Non Coincidental Demands Monthly Charge /kW yr) (Sponsor Demand) /mo. 12 months Exhibit C, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on September 30, 1987 $15,260 5,577 $14,511 5,577 5/ Ratchets shall be handled in accordance with section 5(c). /kW /yr 33,985 kW 0.61 54,350 kW 0.37 $0.980 $0.082 1. MORSE CREEK HYDRO PROJECT (WP- PKT- 0758e) Demand: 485 kW; Voltage: 12.5 kV; Exhibit D, Page 1 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement Description of Proiect, Point of Interconnection, and Points of Delivery Location: the project is located in the NW 1/4 of Section 29, T3ON, R5W, Willamette Meridian, Clallam County, Washington; approximately 3 miles east of Port Angeles and 1 -1/2 to 2 miles south of state route 101 and primarily east of Glass Road; Metering: in the City's powerhouse, in the 480 volt circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for transformation losses between the Project point of metering and the high side of the Project transformer. 2. MORSE CREEK POINT OF INTERCONNECTION Location: A point on the Utility's distribution line approximately one half mile from the Morse Creek Hydro Project at the junction of Glass and Boyd Roads where the distribution lines of the Utility and the line from the City's Project interconnect; Voltage: 12.5 kV; Adjustments: there shall be an adjustment for transmission losses between the Morse Creek Hydro Project and the Morse Creek Point of Interconnection. 3. PORT ANGELES POINT OF INTERCONNECTION Location: the point in Bay 26 (Clallam Co. PUD's Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the Utility and the Government are connected; Voltages: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be an adjustment for distribution losses between the Utility's Morse Creek Point of Interconnection and the Government's Port Angeles Point of Interconnection. 4. PORT ANGELES POINT OF DELIVERY Location: the point in Bay 23 (Port Angeles Feeder No. 1) in the Government's Port Angeles Substation where the 69 kV facilities of the City and the Government are connected; Voltages: 69 kV; Metering: in the Government's Port Angeles Substation in the 69 kV circuit over which such electric power and energy flows; Adjustments: there shall be no adjustment for losses between the Point of Interconnection and the Point of Delivery. (WP- PKT- 0758e) Exhibit D, Page 2 of 2 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of this Agreement (WP- PKT- 0758e) Loss Factors Exhibit E, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Project Effective at 2400 hours on the Effective Date of‘this Agreement The loss factors specified in Exhibit D, to be applied to the Electric Power made available by the City to Bonneville, shall consist of two components. The first is the transformation and transmission losses from the Project to the Morse Creek Point of Interconnection, and the second is the transmission and transformation losses from the Morse Creek Point of Interconnection to the Port Angeles Point of Interconnection. No loss factor shall be applied between the Port Angeles Point of Interconnection and the Port Angeles Point of Delivery as specified in Exhibit D. The loss factors between the Project Point of Metering and the Port Angeles Point of Interconnection shall be submitted to the City and the Utility by Bonneville -=by separate letter. The revision of these loss factors shall be as specified in section 7(c). Exhibit F, Page 1 of 1 Contract No. DE- MS79- 88BP92315 Morse Creek Hydro Effective at 2400 hours on the Effective Date of this Agreement Resource service charges shall be incorporated into Exhibit F as developed by Bonneville according to section 7(d) of this agreement. As of the Effective Date of this Agreement, the Resource service charge is zero. (WP- PKT- 0758e) Resource Services I EXHIBIT "B" OPERATION PROCEDURES I Reference map and schematic are attached. II Normal operation of hydroproject: a. Main valve (1) is open. b. Isolating valve (2) is open. c. Powerhouse valve (3) is open. d. Line valve (4) is closed. e. Hydroproject generates power. District draws water from pipeline for treatment plant. III Streamflow shutdown: a. Streamflows below FERC license limits are sensed by float at the City's diversion structure. b. A signal is sent to the powerhouse. c. Generation shutdown at the powerhouse by valve (3). d. Flow to District's treatment plant is not interrupted. IV Pipeline break shutdown: a. Loss of pipeline pressure is sensed at powerhouse. b. A signal is sent to the diversion structure. c. Main valve (1) closes and hydroproject shuts down. d. Flow to District's treatment plant is interrupted. City notifies District. e. City determines location of break: 1. Upstream of District treatment plant cannot re- establish water flow until repaired. Repairs will be by the City. LI0060[2] 2. Downstream of District treatment plant City crew closes isolating valve (2) and opens main valve (1) to re- establish water flow to the District's treatment plant. Repairs will be by the City. f. After repairs, City opens isolating valve (2) or main valve (1) and restarts hydroproject (if appropriate). V Electric system fault shutdown: a. District's system protection opens on fault condition. Hydroproject's protection opens on fault condition. b. Powerhouse valve (3) closes. c. Flow to District's treatment plant is not interrupted. d. District isolates work area if fault is on its system possibly opening switch D4260. City isolates work area if fault is on its underground cable would open switch D4260. When switch D4260 is operated by either party, the other will be notified. e. After repairs are made and verification that all workers are in the clear, lines will be re- energized by the owner. f. City will open powerhouse valve (3) and restart the hydroproject. NOTE: A similar procedure would be used in the event of loss of transmission system voltage. VI Planned maintenance shutdown: a. The party planning the maintenance shutdown of electric or water lines will notify the other party 48 hours in advance. b. Planned maintenance will be scheduled to minimize the time normal operation under this Agreement will be interrupted. VII Emergency conditions: When other emergency conditions occur that interrupt normal operation under this Agreement, the affected party will notify the other as soon as reasonably possible. LI0060 [2] 100 i ns ne EXHIBIT `B' R E l^ N D PAST ttrf.tw wJTt• Tw. lnvt •lo+ f►t •e. PIA VfTt 1\ GLASS ROAD SITE PLAN PENSTOCK PROFILE POOP 1••• 114�yj M 11IT ..v...411.1...• 1-7 r.e f. K,s■ I1* 0I• uflf• Fur, f iuTtz r iauT EXHIBIT `B' C /TY WATER P/PE/_l,VE MO25E CtZEEK 1- J•(D2OELE! TZIG p OJELT W4TETC "iZ MSMI 6 Oki 1-I1.15 SGWE.M4TIG C/T UNDER ROUND (bwcR L/NE /STR/cr D, S TR IBU T/Ur( SYSTEM SW /TO 0424,o 11. RAC& TUR Ri 'TD CALO2ih1AroE l3c»Wt q