[COMPOSITE CONFORMED COPY]
POWER CONTRACT, dated as of July 1, 1964, between CONNECTICUT YANKEE
ATOMIC POWER COMPANY ("Connecticut Yankee"), a Connecticut corporation, and (The
names of the Purchasers appear in the attached Appendix) (the "Purchaser").
It is agreed as follows:
1. Basic Understandings
Connecticut Yankee has been organized to provide for the supply of power
to the twelve utility companies (including the Purchaser) which are its
stockholders. It has commenced the construction of a nuclear electric generating
unit of the pressurized water type, which is being designed to have an initial
gross capability of approximately 490 megawatts electric, at a site adjacent to
the Connecticut River at Haddam Neck, Connecticut (the unit being herein,
together with the site and all related facilities, referred to as the "Unit").
Construction of the Unit is being carried out under contracts with Westinghouse
Electric Corporation and Stone & Webster Engineering Corporation.
The Unit is to be operated to supply power to Connecticut Yankee's
stockholders, each of which is undertaking to purchase a fixed percentage of the
capacity and output of the Unit. The respective percentages of the capacity and
output of the Unit to be purchased by the Purchaser and the other Connecticut
Yankee stockholders are the same as the respective percentages of Connecticut
Yankee's stock now owned by them. The names of the stockholders and their
respective percentages ("entitlement percentages") of the capacity and output of
the Unit are as follows:
Stockholder Entitlement Percentage
The Connecticut Light and Power Company 25.0%
New England Power Company 15.0%
Boston Edison Company 9.5%
The Hartford Electric Light Company 9.5%
The United Illuminating Company 9.5%
Western Massachusetts Electric Company 9.5%
Central Maine Power Company 6.0%
Public Service Company of New Hampshire 5.0%
Montaup Electric Company 4.5%
New Bedford Gas and Edison Light Company* 2.5%
Cambridge Electric Light Company* 2.0%
Central Vermont Public Service Corporation 2.0%
Connecticut Yankee and its other stockholders are entering into power contracts
which are identical to this contract except for necessary changes in the names
of the parties. New Bedford Gas and Edison Light Company has informed
Connecticut Yankee that it proposes to transfer the Connecticut Yankee stock
owned by it to Cambridge Electric Light Company. If this transfer is
consummated, the Power Contract between Connecticut Yankee and New Bedford Gas
and Edison Light Company will be cancelled and the contract between Connecticut
Yankee and Cambridge Electric Light Company will be amended to increase
Cambridge Electric Light Company's entitlement percentage from 2.0% to 4.5%.*
* As contemplated by Section 1 of the contract, New Bedford Gas and Edison
Light Company has transferred the Connecticut Yankee stock owned by it to
Cambridge Electric Light Company, the Power Contract between Connecticut Yankee
and New Bedford Gas and Edison Light Company has been cancelled, and the
contract between Connecticut Yankee and Cambridge Electric Light Company has
been amended to increase Cambridge Electric Light Company's entitlement
percentage from 2.0% to 4.5%. As a result of the transfer by New Bedford Gas and
Edison Light Company of the Connecticut Yankee stock owned by it to Cambridge
Electric Light Company, the number of Connecticut Yankee's stockholders has been
reduced from twelve to eleven.
2. Effective Date and Term
This contract shall become effective upon receipt by the Purchaser of
notice that Connecticut Yankee has entered into power contracts, as contemplated
by Section 1 above, with each of its other stockholders. The term of this
contract shall expire 30 years after the plant completion date.
The "plant completion date" shall be the earlier of (i) October 1, 1968,
and (ii) the date on which the Unit is placed in commercial operation, as
determined by Connecticut Yankee (the "commercial operation date").
3. Construction of the Unit
Connecticut Yankee will proceed with due diligence with construction of
the Unit, and will exercise its best efforts to complete and place it in
commercial operation by October 1, 1967, on the presently estimated schedule
therefor and within present cost estimates, and will keep the Purchaser
currently informed as to the progress of construction and expected plant
completion date.
4. Operation and Maintenance of the Unit
Connecticut Yankee will operate and maintain the Unit in accordance with
good utility practice under the circumstances and all applicable law, including
the applicable provisions of the Atomic Energy Act of 1954 and of any license
issued thereunder to Connecticut Yankee. Within the limits imposed by good
utility practice under the circumstances and applicable law, the Unit will be
operated at its maximum capability and on a long hour use basis.
Outages for inspection, maintenance, refueling and repairs and
replacements will be scheduled in accordance with good utility practice and
insofar as practicable shall be mutually agreed upon by Connecticut Yankee and
the Purchaser. In the event of an outage, Connecticut Yankee will use its best
efforts to restore the Unit to service as promptly as possible.
5. Purchaser's Entitlement
The Purchaser will, throughout the term of this contract, be entitled and
obligated to take its entitlement percentage of the capacity and net electrical
output of the Unit, at all levels at which the Unit is operated or operable,
whether more or less than 490 megawatts electric.
6. Deliveries and Metering
The Purchaser's entitlement percentage of the output of the Unit will be
delivered to and accepted by it at the step-up substation at the site. All
deliveries will be made in the form of 3-phase, 60 cycle, alternating current at
a nominal voltage of 345,000 volts. The Purchaser will make its own arrangements
for the transmission of the power.
Connecticut Yankee will supply and maintain all necessary metering
equipment for determining the quantity and conditions of supply of deliveries
under this contract, will make appropriate tests of such equipment in accordance
with good utility practice and as reasonably requested by the Purchaser, and
will maintain the accuracy of such equipment within reasonable limits.
Connecticut Yankee will furnish the Purchaser with such summaries of meter
readings as the Purchaser may reasonably request.
7. Payment
With respect to each month commencing prior to the plant completion date,
the Purchaser will pay Connecticut Yankee at the rate of 5 mills per kilowatt
hour, for the Purchaser's entitlement percentage of the net electrical output
(if any) of the Unit during the particular month.
With respect to each month commencing on or after the plant completion
date, the Purchaser will pay Connecticut Yankee an amount equal to the
Purchaser's entitlement percentage of the sum of (a) Connecticut Yankee's total
operating expenses for the month with respect to the Unit, plus (b) an amount
equal to one-twelfth of 6% per annum of the net Unit investment as most recently
determined in accordance with this Section 7.
Connecticut Yankee's "operating expenses" shall include all amounts
properly chargeable to operating expense accounts, less any applicable credits
thereto, in accordance with the Uniform System of Accounts (the "Uniform
System") prescribed by the Federal Power Commission for Class A and Class B
Public Utilities and Licensees as in effect on the date of this contract;
provided, that, for purposes of this contract, the accrual of depreciation as an
operating expense shall commence on the plant completion date at the rate of 4%
per annum, whether or not the Unit is then in operation, and during each of the
first twenty-five years after the plant completion date the amount included in
operating expenses on account of depreciation accruals (and amortization, if
any, of property losses) shall in no event be less than 4% of the excess of:
(a) the amount properly chargeable at the plant completion date in
accordance with the Uniform System to electric plant accounts (including
construction work in progress) with respect to the depreciable portion of the
Unit (or, if the plant completion date is prior to the commercial operation date
and the amount so chargeable with respect to the depreciable portion of the Unit
on the commercial operation date is greater than it was on the plant completion
date, then such greater amount), over
(b) the amount of net available cash.
The "net Unit investment" shall consist, in each case with respect to the
Unit, of (i) the aggregate amount properly chargeable at the time in accordance
with the Uniform System to Connecticut Yankee's electric plant accounts
(including construction work in progress), less the balance, if any, at the time
of the accumulated provision for depreciation, as determined in accordance with
the Uniform System; plus (ii) the aggregate amount properly chargeable at the
time in accordance with the Uniform System to accounts representing materials
and supplies; plus (iii) such reasonable allowances for prepaid items and cash
working capital as may from time to time be determined by Connecticut Yankee.
However, for purposes of this contract, the net amount included at any date
after the plant completion date in net Unit investment under clause (i) of the
immediately preceding sentence shall in no event be less than the excess of:
(a) the amount properly chargeable at the plant completion date in
accordance with the Uniform System to electric plant accounts (including
construction work in progress) with respect to the Unit (or, if the plant
completion date is prior to the commercial operation date and the amount so
chargeable with respect to the Unit on the commercial operation date is greater
than it was on the plant completion date, then such greater amount),
over
(b) the sum of (1) the aggregate minimum amount required by the proviso to
the third paragraph of this Section 7 to be included in operating expenses from
the plant completion date to the date in question on account of depreciation
accruals (and amortization, if any, of property losses), plus (2) the amount of
net available cash.
The net Unit investment shall be determined as of the plant completion date and
thereafter as of the commencement of each calendar year, or, if Connecticut
Yankee elects, at more frequent intervals.
"Net available cash" means, at any date as of which the amount thereof is
to be determined, the excess of (a) the aggregate amount received by Connecticut
Yankee after the plant completion date and prior to two years before the
determination date as insurance proceeds on account of loss or damage to the
Unit or as the proceeds of a sale or condemnation of a portion of the Unit, over
(b) the aggregate amount expended after the plant completion date and prior to
the determination date on account of rebuilding, repairs, replacements and
additions to the Unit, provided that insurance proceeds received with respect to
a particular loss shall be taken into account for purposes of the foregoing
computation only if the amount received with respect to the loss exceeds
$150,000.
Connecticut Yankee will bill the Purchaser, as soon as practicable after
the end of each month, for all amounts payable by the Purchaser with respect to
the particular month. Such bills will be rendered in such detail as the
Purchaser may reasonably request and may be rendered on an estimated basis
subject to corrective adjustments in subsequent billing periods. All bills shall
be paid in full within 10 days after receipt thereof by the Purchaser.
8. Make-up Term and Option Term
(a) The Purchaser may elect to extend the contract term by written notice
to Connecticut Yankee upon the following conditions and for the following period
or periods:
(i) in the event that the Unit is not in commercial operation on the plant
completion date, the contract term may be extended for a period equal to the
number of consecutive days by which commercial operation is delayed beyond the
plant completion date; and
(ii) if at any time after the commencement of commercial operation no
deliveries are made under this contract for a period of at least 120 consecutive
days, the contract may be extended for a period equal to the aggregate of such
periods during which no deliveries were made.
If the term of the contract is extended pursuant to the provisions of this
subsection (a), all of the contract provisions shall remain in effect for the
extended term.
(b) Upon expiration of the initial term of this contract or upon
expiration of the term as extended in accordance with subsection (a) of this
Section 8, the Purchaser shall continue to be entitled, at its option, to its
entitlement percentage of the capacity and output of the Unit upon terms at
least as favorable as those obtained by any other person.
9. Cancellation of Contract
If deliveries cannot be made to the Purchaser because either
(i) the Unit is damaged to the extent of being completely or substantially
completely destroyed, or
(ii) the Unit is taken by exercise of the right of eminent domain or a
similar right or power, or
(iii) (a) the Unit cannot be used because of contamination, or because a
necessary license or other necessary public authorization cannot be obtained or
is revoked, or because the utilization of such a license or authorization is
made subject to specified conditions which are not met, and (b) the situation
cannot be rectified to an extent which will permit Connecticut Yankee to make
deliveries to the Purchaser from the Unit;
then and in any such case, the Purchaser may cancel this contract. Such
cancellation shall be effected by written notice given by the Purchaser to
Connecticut Yankee. In the event of such cancellation, all continuing
obligations of the parties, including the Purchaser's obligations to continue
payments, shall cease forthwith. Any dispute as to the Purchaser's right to
cancel this contract pursuant to the foregoing provisions shall be referred to
arbitration in accordance with the provisions of Section 13.
Notwithstanding anything in this contract elsewhere contained, the
Purchaser may cancel this contract or be relieved of its obligations to make
payments hereunder only as provided in the next preceding paragraph of this
Section 9. Further, if for reasons beyond Connecticut Yankee's reasonable
control, deliveries are not made as contemplated by this contract, Connecticut
Yankee shall have no liability to the Purchaser on account of such non-delivery.
10. Insurance
Prior to the first shipment of fuel to the plant site, Connecticut Yankee
will obtain, and thereafter will at all times maintain, insurance to cover its
"public liability" for personal injury and property damage resulting from a
"nuclear incident" (as those terms are defined in the Atomic Energy Act of 1954,
as amended), with limits not less than Connecticut Yankee may be required to
maintain to qualify for governmental indemnity under said Act and shall execute
and maintain an indemnification agreement with the Atomic Energy Commission as
provided by said Act. Connecticut Yankee will also at all times maintain such
other types of liability insurance, including workmen's compensation insurance,
in such amounts, as is customary in the case of other similar electric utility
companies, or as may be required by law.
Connecticut Yankee will at all times keep insured such portions of the
Unit as are of a character usually insured by electric utility companies,
similarly situated and operating like properties, against the risk of a "nuclear
incident", and such other risks as electric utility companies, similarly
situated and operating like properties, usually insure against. Such insurance
shall to the extent available be carried in an amount at least equal to the
original cost of the insured facilities, less accrued depreciation thereon.
11. Additional Units
Connecticut Yankee or its nominee may install one or more additional
generating units at the Haddam Neck site. The installation of such unit or units
shall not affect the terms of this contract, but in such case, if and to the
extent appropriate, if any portion of the Unit (whether such portion constitutes
land, structures or equipment) is also used with the additional unit(s), an
appropriate allocation of the cost of the Unit shall be made and the net Unit
investment shall be reduced accordingly, subject, however, to the limitation
that the aggregate amount of the reduction in net Unit investment resulting from
all such allocations shall not exceed $2,000,000.
12. Audit
Connecticut Yankee's books and records (including metering records) shall
be open to reasonable inspection and audit by the Purchaser.
13. Arbitration
In case any dispute shall arise as to the interpretation or performance of
this contract which cannot be settled by mutual agreement, such dispute shall be
submitted to arbitration. The parties shall if possible agree upon a single
arbitrator. In case of failure to agree upon an arbitrator within 15 days after
the delivery by either party to the other of a written notice requesting
arbitration, either party may request the American Arbitration Association to
appoint the arbitrator. The arbitrator, after opportunity for each of the
parties to be heard, shall consider and decide the dispute and notify the
parties in writing of his decision. Such decision shall be binding upon the
parties, and the expenses of the arbitration shall be borne equally by them.
14. Regulation
This contract, and all rights, obligations and performance of the parties
hereunder, are subject to all applicable state and federal law and to all duly
promulgated orders and other duly authorized action of governmental authority
having jurisdiction in the premises.
15. Assignment
This contract shall be binding upon and shall inure to the benefit of, and
may be performed by, the successors and assigns of the parties, except that no
assignment, pledge or other transfer of this contract by either party shall
operate to release the assignor, pledgor or transferor of any of its obligations
under this contract unless consent to the release is given in writing by the
other party, or, if the other party has theretofore assigned, pledged or
otherwise transferred its interest in this contract, by the other party's
assignee, pledgee or transferee.
16. Right of Setoff
The Purchaser shall not be entitled to set off against the payments
required to be made by it under this contract (i) any amounts owed to it by
Connecticut Yankee or (ii) the amount of any claim by it against Connecticut
Yankee. However, the foregoing shall not affect in any other way the Purchaser's
rights and remedies with respect to any such amounts owed to it by Connecticut
Yankee or any such claim by it against Connecticut Yankee.
17. Interpretation
The interpretation and performance of this contract shall be in accordance
with and controlled by the law of the State of Connecticut.
18. Addresses
Except as the parties may otherwise agree, any notice, request, bill or
other communication from one party to the other, relating to this contract, or
the rights, obligations or performance of the parties hereunder, shall be in
writing and shall be effective upon delivery to the other party. Any such com-
munication shall be considered as duly delivered when mailed to the respective
post office address of the other party shown following the signatures of such
other party hereto, or such other post office address as may be designated by
written notice given as provided in this Section 18.
19. Corporate Obligations
This contract is the corporate act and obligation of the parties hereto,
and any claim hereunder against any stockholder, director or officer of either
party, as such, is expressly waived.
20. All Prior Agreements Superseded
This contract represents the entire agreement between us relating to the
subject matter hereof, and all previous agreements, discussions, communications
and correspondence with respect to the subject matter are hereby superseded and
are of no further force and effect.
IN WITNESS WHEREOF, the parties have executed this contract by their
respective officers thereunto duly authorized as of the date first above
written.
CONNECTICUT YANKEE ATOMIC POWER COMPANY
Attest:
By
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Its
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P.O. Box 2010
Hartford, Connecticut 06101
(Purchaser)
Attest:
By
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(Officer)
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Its
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(Title)
(Address)
(Forms of signatures appear in the attached Appendix)
APPENDIX
Separate Power Contracts were entered into, identical in form with the foregoing
except as to the execution thereof and except that on page 1 the names of the
respective Purchasers were inserted.
The Power Contracts were executed by the respective parties thereto, under their
Corporate seals, as follows:
Attest: CONNECTICUT YANKEE ATOMIC POWER COMPANY
R. F. PROBST By S. R. KNAPP
Secretary Its President
P.O. Box 2010
(CORPORATE SEAL) Hartford, Connecticut 06101
Attest: THE CONNECTICUT LIGHT AND POWER COMPANY
C. J. RAMAGE By PAUL V. HAYDEN
Assistant Secretary Its President
P.O. Box 2010
(CORPORATE SEAL) Hartford, Connecticut 06101
Attest: NEW ENGLAND POWER COMPANY
JOSEPH X. CORBETT By ROBERT F. KRAUSE
Clerk Its President
441 Stuart Street
(CORPORATE SEAL) Boston, Massachusetts 02116
Attest: BOSTON EDISON COMPANY
EDWIN J. LEE By CHARLES F. AVILA
Clerk Its President
182 Tremont Street
(CORPORATE SEAL) Boston, Massachusetts 02112
Attest: THE HARTFORD ELECTRIC LIGHT COMPANY
J. B. MADIGAN By R. A. GIBSON
Secretary Its Chairman
P.O. Box 2370
(CORPORATE SEAL) Hartford, Connecticut 06101
Attest: THE UNITED ILLUMINATING COMPANY
A. ROYAL WOOD By WILLIAM J. COOPER
Secretary Its President
80 Temple Street
(CORPORATE SEAL) New Haven, Connecticut 06506
Attest: WESTERN MASSACHUSETTS ELECTRIC COMPANY
N. F. PLANTE By HOWARD J. CADWELL
Clerk Its Chairman of the Board
174 Brush Hill Avenue
(CORPORATE SEAL) W. Springfield, Massachusetts 01089
Attest: CENTRAL MAINE POWER COMPANY
C. W. TOTMAN By W. H. DUNHAM
Assistant Secretary Its President
9 Green Street
(CORPORATE SEAL) Augusta, Maine 04332
Attest: PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
ANNABELLE LANDERS By A. R. SCHILLER
Secretary Its President
1087 Elm Street
(CORPORATE SEAL) Manchester, New Hampshire 03105
Attest: MONTAUP ELECTRIC COMPANY
R. M. KEITH By GUIDO R. PERERA
Clerk Its President
49 Federal Street
(CORPORATE SEAL) Boston, Massachusetts 02107
Attest: NEW BEDFORD GAS AND EDISON LIGHT COMPANY*
R. E. ROLLS By JOHN F. RICH
Clerk Its President
130 Austin Street
(CORPORATE SEAL) Cambridge, Massachusetts 02139
* The contract between Connecticut Yankee and New Bedford Gas and Edison Light
Company has been cancelled.
Attest: CAMBRIDGE ELECTRIC LIGHT COMPANY
R. E. ROLLS By JOHN F. RICH
Clerk Its President
130 Austin Street
(CORPORATE SEAL) Cambridge, Massachusetts 02139
Attest: CENTRAL VERMONT PUBLIC SERVICE CORPORATION
PORTER E. NOBLE By ALBERT A. CREE
Clerk Its Chairman