EXHIBIT 10.16.1
FIRST AMENDMENT TO RATE AGREEMENT
THIS FIRST AMENDATORY AGREEMENT dated as of December 5, 1989 is between
the parties to the agreement dated as of November 22, 1989 (the "Rate
Agreement") between Northeast Utilities Service Company, acting on behalf of
its parent Northeast Utilities, and the Governor and Attorney General of the
State of New Hampshire, acting on behalf of the State of New Hampshire (the
State").
WHEREAS, the parties desire to amend the Rate Agreement in the respects
specified below, and the Attorney General is authorized to act for the State
in agreeing to such amendments.
NOW, THEREFORE, in consideration of the mutual agreements below, the
Parties agree as follows:
1. Amendment of Paragraph 3(a). Paragraph 3(a) of the Rate Agreement
is hereby amended to read as follows:
3. NU System Capacity - (a) To assure an adequate supply of electric
service to the ratepayers of New Hampshire, NU system companies shall provide
capacity to Stand-Alone PSNH and NUNH after the First Effective Date through
a contract or contracts for unit entitlements designed to provide capacity at
the average cost of the NU system. (NU has provided the State with a
designation of the generating units from which the capacity is expected to be
provided and the estimated capacity cost per kilowatt year-by-year in
Appendix A to a letter dated November 20, 1989 from counsel for NU to Larry
Smukler, Senior Assistant Attorney General for the State of New Hampshire. A
copy of that letter and Appendix A thereto is attached hereto as Exhibit F.)
The capacity arrangement shall remain in effect for ten years unless the
Merger Agreement is terminated. In the event the Merger Agreement is
terminated, the capacity arrangement shall continue until October 31, 1995 or
such earlier date as may be specified in a notice of cancellation given by
Stand-Alone PSNH to NU after the effective date of such termination (the
"Termination Date") and at least two years prior to the date on which such
cancellation is to become effective, as Stand-Alone PSNH's capacity
requirements, as determined in accordance with Paragraph 3(b) hereof. The
capacity arrangement shall then terminate unless the Merger Agreement is
terminated under circumstances which require NU to pay Stand-Alone PSNH
termination fee under the Merger Agreement and Stand-Alone PSNH elects within
six months of the Termination Date to extend the capacity arrangement until
October 31, 1999. Stand-Alone PSNH shall specify in its notice of such
election the number of megawatts of capacity it will require for each year
under the arrangement. Stand-Alone PSNH shall provide the NU system companies
right of first refusal to any of the capacity provided by the NU system
companies that it proposes to resell.
2. Amendment of Schedule I to Exhibit A. The definition of "Recovery
Period" in paragraph H of Schedule I to Exhibit A. to the Rate Agreement is
hereby amended to read as follows:
The Recovery Period shall begin on the date that is six months after the
end of the "fixed rate period" (as that term is defined in the Agreement
dated November 22, l989 between Northeast Utilities Service Company, on
behalf of NU, and NH) and shall end on the date that is ten years after the
letter of the In-Service Date or the First Effective Date.
3. Addition of Exhibit F. The attachment hereto which is identified as
Exhibit F is hereby made Exhibit F to the Rate Agreement.
IN WITNESS WHEREOF, each of the Parties has duly executed this First
Amendatory Agreement.
NORTHEAST UTILITIES SERVICE COMPANY
By /s/Bernard M. Fox
THE STATE OF NEW HAMPSHIRE
By /s/John P. Arnold
New Hampshire
Attorney General
EXHIBIT F
November 20, 1989
Larry M. Smukler, Esq.
Senior Assistant Attorney General
Office of the Attorney General
Sate House Annex
Concord, NH 03301
Dear Larry:
Enclosed as Appendix A to this letter are the updated capacity costs,
transmission costs and the percentage of slice associated with the transfer
of capacity from the NU system companies to PSNH. At Norman Stahl's request,
this letter and Appendix A are cross-referenced in paragraph 3 of the
proposed agreement between NU and the State of New Hampshire. This letter
supersedes my prior letter to you of July 21, 1989.
Very truly yours,
/s/C. Duane Blinn
Day, Berry and Howard
Counsellors at Law
CDB/vw
Enclosure
cc: Frederick J. Coolbroth, Esq.
Mr. Robert E. Busch
Thomas D. Rath, Esq.
John B. Nolan, Esq.
Gerald Garfield, Esq.
John R. Bashaw, Esq.
Jeffrey G. Grody, Esq.
J. Miles Read, Esq.
APPENDIX A
CAPACITY COSTS ASSOCIATED WITH THE TRANSFER OF CAPACITY FROM THE NU SYSTEM
COMPANIES TO PSNH.
These capacity transfers are made from a slice of NU system units with
slice percentages and total costs (including transmission) as shown below.
Units Percentage
of Slice (%)
Millstone Unit 1 10.73
Millstone Unit 2 10.73
Millstone Unit 3 17.54
Middletown Unit 3 5.14
Middletown Unit 4 8.56
Montville Unit 6 8.77
Norwalk Harbor Unit 1 3.51
Norwalk Harbor Unit 2 3.72
South Meadow Unit 11 1.19
South Meadow Unit 12 1.19
South Meadow Unit 13 1.19
South Meadow Unit 14 1.19
Cos Cob Unit 10 0.58
Cos Cob Unit 11 0.58
Cos Cob Unit 12 0.58
Northfield 24.80
100.00
Estimated Estimated
Slice of System Transmission Total
Year Capacity Cost Cost Cost
($/KW-YR) ($/KW-YR) ($/KW-YR)
1990 184.2 10.0 194.2
1991 185.3 10.0 195.3
1991 184.4 10.0 194.4
1992 193.0 10.0 203.0
1994 183.7 10.0 193.7
1995 198.5 10.0 208.5
1996 183.2 10.0 193.2
The base rate level of the FPPAC assumes the following annual capacity
needs for NUNH. These needs take into account a 25% allocation to NUNH of
the capability responsibility benefit resulting from the combination of the
NU system companies with NUNH as a single pool participant.
Year Estimated NUNH
Capacity Need (MW)
1990 0
1991 0
1992 0
1993 0
1994 0
1995 0
1996 0