Exhibit 10.5.4
Form of
Amendment No. 7
to
Power Contract
AMENDMENT NO. 7, dated as of the 1st day of February, 1992 between
YANKEE ATOMIC ELECTRIC COMPANY ("Yankee"), a Massachusetts corporation, and
a corporation ("Customer"),
to the Power Contract dated June 30, 1959, as heretofore amended and
revised effective June 2, 1975, October 1, 1980, April 1, 1985, May 6,
1988, June 26, 1989 and July 1, 1989, between Yankee and the Customer (the
"Power Contract").
WITNESSETH
WHEREAS, pursuant to the Power Contract, Yankee supplies to the
Customer and, pursuant to separate power contracts substantially identical
to the Power Contract except for the names of the parties, to the other
stockholders of Yankee, each of whom is contemporaneously entering into an
amendment to its power contract which is identical hereto except for the
necessary changes in the names of the parties, all of the capacity and the
electric energy available from the nuclear generating unit owned by Yankee
at a site in Rowe, Massachusetts (such unit being herein together with the
site and all related facilities owned by Yankee referred to as the
"plant"); and
WHEREAS, Yankee currently possesses a Facility Operating License for
the plant, issued by the Nuclear Regulatory Commission ("NRC"), which
authorizes operation of the plant through July 9, 2000; and
WHEREAS, the parties to the Power Contract and the Federal Energy
Regulatory Commission, which has regulatory jurisdiction over the Power
Contract, have consistently recognized that the cost of the capacity and
electric energy being sold under the Power Contract necessarily included
the costs of shutting down, removing from service and decommissioning the
plant after its useful life had ended and have heretofore incorporated in
the Power Contract provisions designed to achieve that result, whether or
not the plant produces electricity and whether or not the plant operates
for the full term of the Facility Operating License; and
WHEREAS, the parties to the Power Contract recognize that, if the
plant were to be shut down prematurely, it would be anticipated that the
NRC could amend the present Facility Operating License or issue a series of
superseding licenses applicable to the plant until such time as
decommissioning thereof is completed and that Yankee would be required to
retain possession of its spent fuel until such time as the Department of
Energy accepts responsibility therefor as required by law, during which
time the parties intend that the Power Contract would remain in effect to
govern the performance of their responsibilities; and
WHEREAS, the parties to the Power Contract have concluded that it is
in the best interest of their ratepayers and themselves to clarify the
application of the Power Contract in the event of a premature shutdown of
the plant; and
WHEREAS, the parties to the Power Contract desire to amend the
provisions of the Power Contract to provide for the foregoing.
NOW, THEREFORE, in consideration of the above and of other
good and valuable consideration, receipt of which is hereby acknowledged,
the parties hereto agree that the Power Contract is hereby amended as
follows:
1. Terms used herein and not defined shall have the meanings set
forth in the Power Contract.
2. Section 2 of the Power Contract is hereby amended by inserting at
the end thereof the following clause:
",including all billings and adjustments with respect to the
recovery of Yankee's total cost of service, as provided in
Section 6 hereof, until the non-salvageable investment in
plant, nuclear fuel and materials and supplies has been
fully amortized in accordance herewith."
3. Section 6 of the Power Contract is hereby amended by deleting
clause (i) of the fourth paragraph thereof and inserting in lieu thereof
the following:
"(i) depreciation accrued at a rate at least sufficient to
fully amortize over the estimated remaining useful life of
the plant Yankee's non-salvageable investments in plant,
nuclear fuel and materials and supplies, provided, however,
that if a decision is made to cease electricity production
at the plant prior to July 9, 2000, then such remaining non-
salvageable investments shall be amortized over a period
extending to July 9, 2000;".
4. Section 6 of the Power Contract is hereby amended by deleting
clause (iv) of the fourth paragraph thereof and inserting in lieu thereof
the following:
"(iv) costs incurred in connection with decommissioning the
plant, including (a) the direct and indirect costs of
operating, maintaining or dismantling the spent fuel storage
facilities and other plant facilities after the cessation of
electricity production and (b) the accruals to any reserve
established by Yankee's board of directors to provide for
physical decommissioning of the plant over the estimated
remaining useful life of the plant, provided, however, that
if a decision is made to cease electricity production at the
plant prior to July 9, 2000, then the accruals to the
reserve referred to in clause (b) shall be made over a
period extending to July 9, 2000;".
5. Section 6 of the Power Contract is hereby amended by
inserting at the end of the eighth paragraph thereof the following:
";plus (vi) the amount of any unamortized deferred expenses,
as permitted from time to time by the Federal Energy
Regulatory Commission or its successor agency; plus (vii) to
the extent not provided for elsewhere in this paragraph, the
remaining unamortized amount of the non-salvageable
investment in plant, nuclear fuel and materials and
supplies."
6. This Amendment shall become effective as of the date first
above written, subject to any suspension order duly issued by the Federal
Energy Regulatory Commission.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment to be executed by its officer thereunto duly authorized, as of
the date first above written.
YANKEE ATOMIC POWER COMPANY
By___________________________
Its President
CUSTOMER
By_____________________________
Its__________________________
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