Wholesale Standard Offer
Service Agreement
between
Blackstone Valley Electric Company
Eastern Edison Company
Newport Electric Corporation
and
TransCanada Power Marketing Ltd.
April 7, 1998
TABLE OF CONTENTS
Page
ARTICLE 1. Definitions 2
ARTICLE 2. Term 3
ARTICLE 3. Supplier Responsibilities 3
ARTICLE 4. Estimation of Hourly Loads and Reporting to the ISO 4
ARTICLE 5. Price 5
ARTICLE 6. Billing and Payments 6
ARTICLE 7. Events of Default, Liability. Relationship of the Companies 6
ARTICLE 8. Termination/Reimbursement 8
ARTICLE 9. Force Majeure 8
ARTICLE 10. Assignment 9
ARTICLE 11. Successors and Assigns 10
ARTICLE 12. Resolution of Disputes 10
ARTICLE 13. Interpretation 11
ARTICLE 14. Severability of Provisions 11
ARTICLE 15. Accounts and Records 11
ARTICLE 16. Limitations on Liability and Indemnification 12
ARTICLE 17. Regulation 12
ARTICLE 18. Notices 12
ARTICLE 19. Miscellaneous 13
Appendix A Schedule of Supplier's Share of Offer Service and Standard Offer
Wholesale Price
WHOLESALE STANDARD OFFER SERVICE AGREEMENT
This Wholesale Standard Offer Service Agreement ("Agreement"), is made and
entered into this seventh day of April, 1998 between Eastern Edison Company,
("Eastern") a Massachusetts Corporation; Blackstone Valley Electric Company
("Blackstone"), a Rhode Island Corporation; and Newport Electric Corporation
("Newport"), a Rhode Island Corporation (referred to collectively as the
"Companies"), on the one hand, and TransCanada Power Marketing, Ltd., a
Delaware Corporation, ("Supplier"), on the other h and.
WHEREAS, the Supplier will purchase certain electric resources from Montaup
Electric Corn any, under an asset purchase agreement, (the "Asset Purchase
Agreement") dated April 7, 1998; and as condition of such purchase and sale
Supplier is required to assume a share of the Companies' Standard Offer Service
under this Agreement; and
WHEREAS, the Companies are required to provide firm all- requirements service
to any retail customer that is eligible for and is taking Standard Offer
Service in accordance with the Settlement Agreements; and
WHEREAS, this Agreement provides for the transfer, from the Companies to
Supplier, of the responsibility for providing firm all-requirements electric
service including capacity, energy, reserves, losses and other related services
necessary to serve a specified share of the Companies' aggregate load of retail
customers taking Standard Offer Service; and
WHEREAS, by entering into this Agreement, Supplier agrees to provide and the
Companies agree to receive and pay for electricity provided in accordance with
the terms and conditions of this Agreement and the applicable Appendices.
subject to any actions by any governmental bodies having regulatory
jurisdiction over services rendered hereunder.
NOW, THEREFORE, in consideration of the mutual promises. covenants, and
agreements contained herein, Supplier and Companies agree to the terms and
conditions as set forth below:
ARTICLE 1. Definitions:
Whenever used in this Agreement. the following terms shall have the following
meanings:
"Affiliate" shall mean any other entity (other than an individual) that,
directly or indirectly, through one or more intermediaries. controls, or is
controlled by, or is under common control with, such entity. For purposes of
the foregoing the definition of "control" means the direct or indirect
ownership of more than seventy percent of the outstanding capital stock or
other equity interest having ordinary voting power.
"Agreement" shall mean this Agreement, including its Appendices as amended from
time to time.
"Commencement Date of Service" shall mean the Effective Date as defined in the
Asset Purchase Agreement.
"Contract Year" shall mean any calendar year, or in the case of 1998 part of a
calendar year, after the Commencement Date of Service in which Supplier is
scheduled to provide electricity to the Companies for Standard Offer Service.
"Companies' System" shall mean the electrical distribution systems of
Blackstone, Newport, Eastern, and/or the electrical transmission system of
Montaup Electric Company, as applicable.
"Delivered Energy" shall mean the kilowatt-hours delivered to the meters of
those retail customers taking Standard Offer Service.
"Delivery Point" shall be any location on the NEPOOL PTF system or Companies'
System.
"D.T.E." shall mean the Massachusetts Department of Telecommunications and
Energy.
"ISO" shall mean ISO New England, Inc., the independent system operator
established in accordance with the Restated NEPOOL Agreement, or its successor.
"NEPOOL" shall mean the New England Power Pool or its successor.
"Party" or "Parties" shall mean the Supplier and the Companies and their
respective successors and assigns.
"PPA Transfer Agreement" shall mean the PPA Transfer Agreement as defined in
the Asset Purchase Agreement.
"Price" shall mean the annual amount per kilowatt-hour to be paid for Delivered
Energy set forth in Article 5 with no variation for time-of-use, seasonality,
or any other factor except as specified in Article 5. The Companies or their
Standard Offer customers shall not be obligated under this Agreement for any
payments for Delivered Energy in addition to the payments made
pursuant to Article 5.
"PTF" shall mean the facilities categorized as Pool Transmission Facilities as
defined in the Restated NEPOOL Agreement.
"P.U.C." shall mean the Rhode Island Public Utilities Commission.
"Restated NEPOOL Agreement" shall mean the New England Power Pool Agreement
dated December 31, 1996, as amended from time to time, as it is in force at the
time the action in question is taken.
"Settlement Agreements" shall mean the agreement or agreements that have been
approved by the MDTE in Docket No. 96-24, the RIPUC in Docket No. 2514 and by
the FERC in Docket Nos. ER97-2800-000 and ER97-3127-000 together with all
conditions, terms a nd modifications imposed by those agencies as of the date
of this Agreement.
"Standard Offer Service" shall mean firm all-requirements electric service
(minute by minute, hour by hour, day by day) including, but not limited to:
energy, installed capability, operable capability, reserves, and associated
losses necessary to fulfill all NEPOOL and ISO obligations as they may change
from time to time associated with providing firm all requirements power to the
Companies' retail customers taking Standard Offer Service in accordance with
and as defined in the Settlement Agreements. Supplier is responsible for
changes in customer demand for any reason, including, but not limited to,
seasonal factors, daily load fluctuations, increased or decreased usage, demand
side management activities, extremes in weather, and other similar events.
"Standard Offer Wholesale Price" shall mean the stipulated stream of prices, in
cents per kilowatt-hour, that will be paid to suppliers of Standard Offer
Service for Delivered Energy, as shown in Appendix A.
"Terms and Conditions for Suppliers" shall mean the Blackstone Valley Electric
Company and Newport Electric Corporation Terms and Conditions for Electric
Power Suppliers dated May 29, 1997 as approved by the P.U.C., or the Eastern
Edison Company Terms and Conditions for Competitive Suppliers as approved by
the D.T.E., as applicable. These Terms and Conditions may be revised.
amended, supplemented. or supplanted in whole or in part from time to time by
the P.U.C. or D.T.E. or as other-wise provided by law.
ARTICLE 2. Term:
The term of this Agreement shall begin on the Commencement Date of Service and
end at 12:00 midnight on December 1. 2009, unless terminated sooner in
accordance with Article 7 or 8.
ARTICLE 3. Supplier Responsibilities
Supplier shall be a member, in good standing, of NEPOOL or its successor entity
and maintain an own-load dispatch or settlement account established in
accordance with the rules and criteria established by the ISO throughout the
term of this agreement . In addition, Supplier must satisfy registration and
certification requirements, as the case may be. as a Non-Regulated Power
Producer in Massachusetts and Rhode Island.
Supplier is responsible for providing firm all-requirements service necessary
to serve its share, as shown in Appendix A attached hereto, of the Companies
aggregate load attributed to those customers taking Standard Offer Service.
As a provider of Standard Offer Service, Supplier is solely responsible for
satisfying all requirements and paying, all costs incurred or to be incurred to
provide those services including, without limitation, all costs or other
requirements to furnish installed capability, operable capability, energy,
operating reserves, automatic generation control and reactive power support,
receipt of, and payment for, tie benefits, line losses and other ancillary
services associated with the provision of it s share of Standard Offer Service.
Supplier is also solely responsible for meeting any other requirements and
paying any other cost now or hereafter imposed by the ISO from time to time
which are attributable to the provision of Standard Offer Service, as they may
arise. If the ISO or any successor entity or the NEPOOL Administrator
allocates any NEPOOL expenses or uplift costs to the Standard Offer Service
provided by the Supplier (on a load or peak load basis or otherwise), the
expenses or costs so allocated will be borne by the Supplier alone without
recourse to the Companies.
Supplier shall be responsible for all transmission and distribution losses
associated with the delivery of electricity supplied under this Agreement from
the sources of its supply to the meters of those customers taking Standard
Offer Service.
The Companies, in their regulated charges, will bill Standard Offer Service
customers for NEPOOL Regional Network Transmission Service ("RNS"), any Local
Area Network Transmission Service ("LNS") which is the transmission, if any,
between the NEPOOL PTF and the Companies' distribution system, and for the
Companies' distribution costs. Supplier is responsible for any transmission
wheeling costs to the Delivery Point and any distribution wheeling costs
associated with supply sources not included in Companies' approved distribution
rates. If the NEPOOL control area experiences congestion, Supplier will be
responsible for any congestion costs incurred in delivering power across the
PTF system to the Companies. Supplier shall be responsible for all
transmission and distribution costs associated with the use of transmission
systems outside of NEPOOL and any local point-to-point transmission charges and
distribution charges incurred to deliver the power to the NEPOOL PTF.
In the event that either the D.T.E. or the P.U.C. issue orders requiring the
Companies to implement uniform disclosure requirements that pertain to the
reporting of information regarding, power plant emissions, fuel types, or labor
information for the sources of electricity used to supply Standard Offer
Service, the Supplier will provide such information in a timely manner in an
appropriate form to enable the Companies to comply with such requirements.
ARTICLE 4. Estimation of Hourly Loads and Reporting to the ISO:
To meet their NEPOOL obligations, the Companies shall report to the ISO
Supplier's share of hourly Standard Offer Service load, including distribution
and non-PTF losses. In making such reports, the Companies will estimate
Supplier's share of Standard Offer Service load based on the methods and
procedures approved in Terms and Conditions for Suppliers on file with the
P.U.C. and D.T.E., as amended from time to time, as applicable.
As required by NEPOOL. the Companies will make all reasonable efforts to report
to the ISO Supplier's hourly share of Standard Offer Service load by 12:00 noon
of the second following business day.
As described in the Terms and Conditions for Suppliers, at the end of each
month, the Companies shall aggregate Supplier's hourly Standard Offer Service
loads for the month as reported to the ISO. The Supplier's aggregate share of
Standard Offer Service, not including losses will be deemed to be the quantity
of Delivered Energy that Supplier provided for that month and is the unadjusted
kWh amount to be used for Billing and Payment as described in Article 6.
The Companies will periodically reconcile the Delivered Energy to actual meter
readings of those customers taking Standard Offer Service, as described in the
Terms and Conditions for Suppliers. The Companies will apply any resulting
billing adjustment (debit or credit) to Supplier's account no later than the
last day of the third month following the billing month.
ARTICLE 5. Price:
For each kilowatt-hour of Delivered Energy that Supplier provides in each
month, as determined in accordance with Article 4 and the Terms and Conditions
for Suppliers, the Companies shall pay Supplier the applicable Price for the
month in cents per kilowatt-hour calculated as follows:
Price = Standard Offer Wholesale Price
+ Fuel Adjustment Factor
Where: Standard Offer Wholesale Price in cents per kilowatt hour is as
defined in Article 1 and shown in Appendix A, and
Fuel Adjustment Factor is a cents per kilowatt-hour adder based on the
incremental revenues collected, if any, attributed to the operation of the
retail Rate Fuel Adjustment mechanism in the Companies' Standard Offer Service
tariffs. The incremental revenues attributed to the retail Fuel Adjustment
will be fully allocated to Suppliers in proportion to the Standard Offer
Service energy provided by each Supplier for the applicable billing month
through the Fuel Adjustment Factor. The retail Fuel Adjustment. and the
resulting Fuel Adjustment Factor to be paid to Supplier, will be made subject
to regulatory approval and only to the extent that the Companies are allowed to
collect such revenues, from their retail customers taking Standard Offer
Service.
With the exception of any sales or gross receipts taxes which are required by
law to be paid by Standard Offer Service customers, the Price for Delivered
Energy as set forth herein includes all local, state and federal taxes, fees
and assessments applicable as of the date here which may be assessed or
imposed in the future by any governmental authority with jurisdiction governing
the sale of electricity covered by this Agreement.
ARTICLE 6. Billing and Payments:
Until reconciled with actual metered data pursuant to the Terms and Conditions
of suppliers, computations by the Companies of the charges for the purposes of
billings hereunder shall be based on estimates of Supplier's Delivered Energy
in accordance with Article 4 and the Price as determined in accordance with
Article 5. The Companies shall calculate the amount payable to Supplier for a
given month on or before the twentieth (20th) day of the following month. The
calculation shall be provided t o Supplier and shall show the total amount due
and payable for the previous month. Each bill shall be subject to adjustment
for any errors in arithmetic computation, estimating, reconciliation pursuant
to the Terms and Conditions of Suppliers or otherwise only to the extent
allowed by the terms of this Article 6.
On or before the last day of each month, Companies shall pay Supplier any
amounts due and payable for the Delivered Energy provided by Supplier in the
previous month ("Due Date"). Any amount remaining unpaid after the Due Date
shall bear interest at the Prime Rate then in effect at the main office of
BankBoston, or such other lending institution as agreed to by Companies and
Supplier, from the Due Date to the date of payment by Companies.
If Supplier disputes the amount of any bill or payment, Supplier shall itemize
the basis for its dispute in a written notice to Companies within fifteen days
after the Due Date. Billing and payment disputes shall be handled in
accordance with the provisions of Article 12 of this Agreement. Upon final
resolution of the dispute, payment of any amount due to a Party under the terms
of the resolution shall be made within thirty (30) days of the date thereof,
together interest from and after the original Due Date at the rate specified
in this Article.
The Companies may make retroactive adjustments to any billing for a period of
up to one year from the date of the original billing in order to reflect
differences in charges resulting from receipt of more accurate data. Supplier
may dispute such adjustment in writing within thirty (30) days of receipt of
the proposed adjustment.
ARTICLE 7. Events of Default, Liability, Relationship of the Companies:
(1) Unless excused by a Force Majeure as described in Article 9, each of
the following events shall be deemed to be an Event of Default hereunder:
(a) Failure of Supplier, in a material respect, to comply with, observe, or
perform any covenant. warranty or obligation under this Agreement, and such
failure is not cured or rectified within thirty (30) days after notice thereof
from the Companies.
(b) Failure of the Companies, in a material respect, to comply with,
observe, or perform any covenant. warranty or obligation under this Agreement,
and such failure is not cured or rectified within thirty (30) days after notice
thereof from the Supplier.
(2) Upon the occurrence of an Event of Default by the Companies, the
Companies shall be liable to the Supplier for any direct damages resulting from
the Event of Default. In addition, the Supplier may pursue any remedies or
other damages provide d for under law, and may unconditionally terminate this
Agreement by giving at least sixty (60) days advance written notice to the
Companies, such termination to be effective as of the date specified in such
notice. Notwithstanding any other provision of this Agreement to the
contrary, the rights and obligations of the Companies herein are several and
not joint. Each of the Companies share of such rights and obligations shall be
determined by the portion that its monthly Standard Offer Service requirements
represented as a percentage of the Companies' total Standard Offer Service
requirements.
(3) Upon the occurrence of an Event of Default by the Supplier, the
Supplier shall be liable to the Companies for all costs reasonably incurred by
the Companies resulting from Supplier's failure to deliver its share of the
Standard Offer Service. Such amount shall be calculated as the positive
difference, if any, obtained by subtracting the per unit Price established in
Article 5, from the per unit Replacement Price. The positive difference shall
be applied to each kilowatthour that Supplier fails to deliver.
"Replacement Price" shall mean the price at which the Companies acting in a
commercially reasonable manner purchase substitute Standard Offer Service not
delivered by Supplier, plus any additional transmission and NEPOOL charges,
incurred by the Companies. The parties hereby stipulate that purchases at the
applicable NEPOOL spot market prices will be deemed commercially reasonable.
The Parties expressly agree that the amounts set forth in this Article 7
subparagraph do not constitute liquidated damages. In addition to the amounts
established in this Article 7 subparagraph above, the Supplier shall be liable
to the Companies for any additional direct damages resulting from an Event of
Default, including, but not limited to, reasonable additional administrative
and legal expenses incurred as a result of Supplier's failure to deliver, and
the Companies may pursue any remedies or other damages provided for under law
and may unconditionally terminate this Agreement by giving at least sixty (60)
days advance written notice to the Supplier, such termination to be effective
as of the date specified in such notice.
(4) As a condition of this Agreement. the Supplier shall deliver to the
Companies, prior to the Commencement Date of Service, financial surety
reasonably acceptable to the Companies to secure Supplier's performance under
this Agreement. The Companies accept the Guarantee attached to the Asset
Purchase Agreement as reasonable financial surety.
ARTICLE 8. Termination/Reimbursement:
(1) In addition to the termination rights for an Event of Default provided
in Article 7, the Companies may terminate this Agreement, if:
a. Supplier's share of Standard Offer Service load is less than one (1)
megawatt for two consecutive months;
b. The Companies are prevented by any government agency of competent
jurisdiction from recovering from customers taking Standard Offer
Service the cost of electricity provided by Supplier; or
c. Any governmental or regulatory agency with jurisdiction over the
Companies orders, implements, requires, or causes what the Companies
determine, in their sole discretion, to be a material modification or
amendment of Standard Offer Service.
(2) In the event of a material default by Montaup under the PPA Transfer
Agreement between Supplier and Montaup, Supplier may unconditionally terminate
the Agreement by giving at least sixty (60) days written notice to the
Companies, such termination to be effective as of the date specified in such
notice. In the event that the default by Montaup under the PPA Transfer
Agreement is cured prior to the effective date of notice of termination, such
termination will be cancelled and the Agreement will remain in full force and
effect.
(3) In the event that the Standard Offer Service or the Terms and Conditions
for Suppliers are terminated, amended or replaced by any governmental or
regulatory agency having jurisdiction over the provision of Standard Offer
Service in a manner which materially increases Supplier's costs or obligations
to provide Standard Offer Service, the Companies shall promptly reimburse
Supplier for any such costs or increased obligations or otherwise provide
relief reasonably acceptable to supplier to or indemnify the Supplier from such
changes. In such event the Companies and Supplier shall meet to determine the
amount to be reimbursed to Supplier. In the event that the Parties are not
able to agree on the materially of the increased costs or obligations or the
amount to be reimbursed, the Parties shall attempt to resolve the matter in
accordance with Article 12 and failing resolution in accordance with Article
12, either Party may terminate this Agreement on sixty (60) days written notice
to the other Party, such termination to be effective as of the date specified
in such notice.
ARTICLE 9. Force Majeure:
As used in this Agreement, "Force Majeure" means any cause beyond the
reasonable control of, and without the fault or negligence of, the Party
claiming Force Majeure. A Force Majeure shall include, without limitation.
sabotage, strikes, riots or civil disturbance, acts of God, acts of a public
enemy, drought, earthquake, flood, explosion, fire, lightning, landslide, or
any similar cataclysmic occurrence, or appropriation or diversion of
electricity by sale or order of any governmental authority having jurisdiction
thereof, but only if and to the extent that the event adversely affects the
availability of the transmission or distribution facilities of NEPOOL and/or
its participants, the Companies or an affiliate of the Companies. and such
affected facilities are necessary to deliver Standard Offer Service electricity
to the Standard Offer Service customers.
An event that affects the availability or cost of operating- any transmission
or distribution facilities outside the NEPOOL control area, affects the
availability or cost of operating a generating facility, or any event that
merely causes an economic hardship to either Party shall not be deemed a Force
Majeure.
If either Party is rendered wholly or partly unable to perform its obligations
under this Agreement because of Force Majeure as defined above, that Party
shall be excused from whatever performance is affected by the Force Majeure, to
the extent so affected, provided that:
(a) The non-performing Party promptly, but in no case longer than five (5)
working days after the occurrence of the Force Majeure, gives the other
Party written notice describing the particulars of the occurrence;
(b) The suspension of performance shall be of no greater scope and of no
longer duration than is reasonably required by the Force Majeure;
(c) The non-performing Party uses reasonable efforts to remedy its
inability to perform and expeditiously takes reasonable action to
correct or cure the event or condition; and
(d) The non-performing Party exercises all reasonable efforts to mitigate
or limit damages to the other Party. With respect to the Supplier,
this shall mean that Supplier must purchase, at its own expense,
electricity from the NEPOOL market to meet its obligations under this
Agreement, to the extent such electricity is available.
ARTICLE 10. Assignment:
Unless mutually agreed to by the Parties, no assignment, pledge, or transfer of
this Agreement shall be made by either Party without the prior written consent
of the other Party, which shall not be unreasonably withheld, except no prior
written consent shall be required for (i) the assignment, pledge or other
transfer to another company or Affiliate in the same holding company system as
the assignor, pledgor or transferor, provided, the assignee, pledgee or
transferee expressly assumes and demonstrates, to the reasonable satisfaction
of the non-assigning Party, that it can meet the obligations of the assignor,
pledgor or transferor under this Agreement, or (ii) the transfer, incident to a
merger or consolidation with. or transfer of all (or substantially all) of the
assets of the transferor, to another person or business entity, provided, such
transferee expressly assumes and demonstrates, to the reasonable satisfaction
of the non-assigning party, that it can meet all the obligations o f the
assignor. pledgor or transferor under this Agreement.
ARTICLE 11. Successors and Assigns:
This Agreement shall be binding upon and shall inure to the benefit of the
Parties and their successors and assignees.
ARTICLE 12. Resolution of Disputes:
Subject to Section 3 of Article 7, all disputes between the Companies and
Supplier resulting from or arising out of performance under this Agreement
shall be referred to a senior representative of the Companies with authority to
settle, designated by the Companies, and a senior representative of Supplier
with authority to settle, designated by Supplier, for resolution on an
informal, face-to-face basis as promptly as practicable. The Parties agree
that such informal discussion shall be conducted in good faith. The
discussions between such representatives shall be considered "settlement talks"
under Rule 403 of the Federal Rules of Evidence or analogous Massachusetts
rules or practices and such discussions shall have no evidentiary value -
provided, however, that either Party may introduce evidence of matters
discussed in such settlement talks, if the facts and documents reflecting such
matters are discovered or otherwise come into a Party's possession independent
of such settlement talks. In the event the designated senior representatives
are unable to resolve the dispute within thirty (3O) days, or such other period
as the Companies and the Supplier may jointly agree upon, such dispute may be
submitted to arbitration and resolved in accordance with the arbitration
procedure set forth herein if the Companies and Supplier jointly agree to
submit it to arbitration. Nothing in this Article 12 shall prevent the
Companies from issuing, pursuant to Sections 1 (a) and (3) of Article 7,
notice of failure to comply with, observe or perform this Agreement.
The arbitration shall be conducted before a single neutral arbitrator or
arbitrator panel appointed by the Parties. If the Parties agree upon a single
arbitrator within ten (1O) days of the referral of the dispute to arbitration,
that arbitrator shall serve, otherwise the Companies and Supplier shall each
choose one arbitrator, who shall serve on a three-member arbitration panel.
The two arbitrators so chosen shall within twenty (20) days select a third
arbitrator to act as chairman of the arbitration panel. If the two
arbitrators are unable to select a third arbitrator, each arbitrator shall
select three candidates. A list of the six candidates, along with their
resumes, shall provided in alphabetical order, with no indication of the
arbitrator who selected such candidate or the Party who selected the arbitrator
who selected such candidate, to the American Arbitration Association ("AAA"),
who will select one candidate. If that candidate is unable or unwilling to
serve, AAA shall select another candidate. This process will be repeated until
a third arbitrator is selected or the list of candidates is exhausted. If the
list of candidates is exhausted, the arbitrators shall submit a new list of
candidates and the process set forth above shall be repeated a second time.
In all cases, the arbitrator(s) shall be knowledgeable in electric utility
matters, including electricity transmission and bulk power issues. and shall
not have any current or past substantial business or financial relationships
with any Party to the arbitration or any affiliate of such Party.
Except as otherwise provided herein, the arbitrator(s), shall generally conduct
the arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association. There shall be no formal discovery conducted
in connection with the arbitration, except as specifically authorized by a
vote of the panel. The Parties shall exchange witness lists and copies of any
exhibits that they intend to utilize in their direct presentations at any
hearing before the arbitrator(s) at l east ten (1O) days prior to such hearing,
along with any other information or documents specifically requested by the
arbitrator(s) prior to the hearing. Unless otherwise agreed, the arbitrator(s)
shall render a decision within ninety (90) days of h is, her, or their
appointment and shall notify the Parties in writing of such decision and the
reasons therefor, and shall make an award apportioning the payment Of the costs
and expenses of arbitration, including panel costs, among the Parties,
provided, however, that each Party shall bear the costs and expenses of its own
attorneys, expert witnesses and consultants. The arbitrator(s) shall be
authorized only to interpret and apply the provisions of this Agreement and
shall have no power to am end or modify this Agreement in any manner. The
decision of the arbitrator(s) shall be final and binding upon the Parties, and
judgment on the award may be entered in any court having jurisdiction. The
decision of the arbitrator(s) may be appealed solely on the grounds that the
conduct of the arbitrator(s), or the decision itself, violated the standards
required under the Federal Arbitration Act (9 U.S.C.A. I et. al.) and/or The
Uniform Arbitration Act, as adopted in Massachusetts (M.G.L. c. 25 1, I et
seq.).
ARTICLE 13. Interpretation:
The interpretation and performance of this Agreement shall be in accordance
with and shall be controlled by the laws of the Commonwealth of Massachusetts,
without regard to Massachusetts conflict of law principles.
ARTICLE 14. Severability of Provisions:
Subject to the provisions of Article 13, a holding by any court having,
jurisdiction that any provision of this Agreement is invalid or unenforceable
shall not result in invalidation or unenforceability of the entire Agreement
but all remaining terms shall remain in full force and effect.
ARTICLE 15. Accounts and Records:
The Companies and Supplier shall keep complete and accurate records of their
operations hereunder and shall maintain such data for a period of at least two
(2) years after final billing. The Companies and Supplier shall have the
right, during normal business hours, to examine and inspect all such records
insofar as may be necessary for the purpose of ascertaining the reasonableness
and accuracy of all relevant data, estimates or statement of charges associated
with service hereunder.
ARTICLE 16. Limitations on Liability and Indemnification:
Each Party agrees to indemnify, defend, and hold the other Party (including,
the other Party's affiliated companies, trustees, directors, board members,
officers, employees, and agents) harmless from and against any and all damages,
costs, claims, liabilities, actions or proceedings arising, from or claimed to
have arisen from the wrongful acts or omissions of the indemnifying, Party's
employees or agents, unless caused by an act of negligence or willful
misconduct by the indemnified Party (including the Party's affiliated
companies, trustees, directors, board members, officers, employees or agents).
The Parties hereby waive. and release the other Party as well as the other
Party's affiliated companies, trustees, directors, officers, employees, and
agents from any liability, claim, or action arising from damage to its property
due to the performance of this Agreement.
ARTICLE 17. Regulation:
(a) This Agreement and all rights, obligations, and performances of the
Parties hereunder, are subject to all applicable state and federal laws, and to
all duly promulgated orders and other duly authorized actions of governmental
authority having jurisdiction, 'provided, however, that this Agreement shall
not be subject to change through unilateral application under Sections 205 and
206 of the Federal Power Act.
(b) This Agreement must comply with all NEPOOL Criteria, Rules, and
Standards ("Rules"). If, during the term of this Agreement, the Restated
NEPOOL Agreement is terminated or amended in a manner that would eliminate or
materially alter a Rule affecting a right or obligation of a Party hereunder,
or if such a Rule is eliminated or materially altered by NEPOOL or the ISO, the
Parties agree to negotiate in good faith in an attempt to amend this Agreement
to incorporate such changes as they deem necessary to reflect the elimination
or alteration of such Rule. The intent of the Parties is that any such
amendment reflect, as closely as possible, the intent and substance of the Rule
being replaced as was in effect prior to such termination or amendment of the
Restated NEPOOL Agreement or elimination or alteration of the Rule. If the
Parties are unable to reach agreement on such an amendment, the Parties agree
to submit the matter to arbitration under the terms of Article 12, and to seek
a resolution of the matter consistent with the above stated intent.
ARTICLE 18. Notices:
Any notice, demand, or request permitted or required under this Agreement shall
be delivered in person or mailed by certified mail, postage prepaid, return
receipt requested, or otherwise confirmed receipt, to a Party at the applicable
address set forth below:
To Companies:
Director, Power Supply
EUA Service Corporation
P. 0. Box 543
750 West Center Street
West Bridgewater, MA 02379
To Supplier:
TransCanada Power Marketing Ltd.
3400, 237 - 4th Avenue S.W.
Calgary, Alberta T2P 5A4
Such addresses may be changed from time to time by written notice by either
Party to the other Party.
ARTICLE 19. Miscellaneous:
(a) Each Party shall prepare, execute and deliver to the other Party any
documents reasonably required to implement any provision hereof.
(b) Each Party represents to the other that this Agreement and such Party's
performance thereof are within the corporate powers of such Party and
have been duly authorized by proper corporate action on the part of
such Party.
(c) Any number of counterparts to this Agreement may be executed and each
shall have the same force and effect as the original.
(d) This Agreement shall constitute the entire understanding between the
Parties and shall supersede all prior correspondence and understandings
pertaining to the subject matter of this Agreement.
(e) Failure of either Party to enforce any provision of this Agreement or
to require performance by the other Party of any of the provisions
hereof, shall not be construed as a waiver of such provisions or affect
the validity of this Agreement, any part hereof, or the right of
either Party to thereafter enforce each and every provision.
(f) Article and Section headings used throughout this Agreement are for the
convenience of the Parties only and are not to be construed as part of
this Agreement.
(g) Nothing in this Agreement shall be construed as creating any
relationship between the Parties other than that of independent
contractor for the sale and purchase of electricity.
(h) Notwithstanding any other provision of this Agreement to the contrary,
the rights and obligations of the Companies herein are several and not
joint. Each of the Companies share of such rights and obligations
shall be determined by the portion of its monthly Standard Offer
Service energy requirements represented as a percentage of the
Companies' total Standard Offer Service requirement.
IN WITNESS WHEREOF, Supplier and the Companies have caused this Agreement to be
signed by their respective duly authorized representatives as of the date first
above written.
Supplier: TransCanada Power Marketing Ltd.
By: /s/ Russ Girling
On Behalf of the Companies:
Blackstone: BLACKSTONE VALLEY ELECTRIC CO
By: /s/ Michael J. Hirsh
Eastern: EASTERN EDISON COMPANY
By: /s/ Michael J. Hirsh
Newport: NEWPORT ELECTRIC CORPORATION
By: /s/ Michael J. Hirsh
APPENDIX A
SCHEDULE OF SUPPLIERS SHARE of STANDARD OFFER SERVICE
AND
STANDARD OFFER WHOLESALE PRICE
TABLE I
Calendar Supplier's Share Standard
Year of Standard Offer
Offer Service Wholesale
In Percent Price
1999 14.4550% 3.5 cents/kWh
2000 14.4550% 3.8 cents/kWh
2001 14.4550% 3.8 cents/kWh
2002 14.4550% 4.2 cents/kWh
2003 14.4550% 4.7 cents/kWh
2004 14.4550% 5.1 cents/kWh
*2005 14.4550% 5.5 cents/kWh
2006 14.4550% 5.9 cents/kWh
2007 14.4550% 6.3 cents/kWh
2008 14.4550% 6.7 cents/kWh
2009 14.4550% 7.1 cents/kWh
*Standard Offer Service for Eastern Edison terminates at 12:00 midnight on
December 31, 2004.