Exhibit 10.69
SCE STANDARD CONTRACT
LONG TERM POWER PURCHASE
POWER PURCHASE CONTRACT
BETWEEN
SOUTHERN CALIFORNIA EDISON COMPANY
AND
COSO GEOTHERMAL COMPANY
DOCUMENT NO.: 2126C
EFFECTIVE DATE: September 7, 1983
REVISED: May 4, 1983
1. Project Summary
This Contract is entered into between Southern California Edison Company
("Edison") Coso Geothermal Company, a Clifornia joint venture between
California Energy Company, Inc. and Caithness Corporation, and others
("Seller"). Seller is willing to construct, own, and operate a Qualifying
Facility and sell electric power to Edison and Edison is willing to purchase
electric power delivered by Seller to Edison at the Point of Interconnection
pursuant to the terms and conditions set forth as follows:
1.1 All Notices shall be sent to Seller at the following address;
California Energy Company, Inc. 3333 Mendocino Avenue, Suite 100 Santa Rosa,
CA 95401
1.2 Seller's Generating Facility:
a. Nameplate Rating: 75,000 KW
b. Location: Coso Nora-China Lake, CA
c. Type (check One):
___Cogeneration Facility
X Small Power Production Facility
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d. Delivery of power to Edison at a nominal 115,000 volts.
e. Seller shall (Commerce constitution of the Generating Facility by October
1, 1987
1.3 Edison Customer Service District: Ridgecrest District
510 S. China Lake Blvd.
Ridgecrest, CA 93555,
Phone: (714) 375-1552
1.4 Location of Edison Operating Switching Center:
Lugo Substation,
6655 Escondido Street,
Hesperia, CA
1.5 Contract Capacity: Phase I 22,500 KW
Phase II 22,500 KW
Phase III 22,500 KW
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TOTAL 67,500 KW
1. 5.1 Estimated as-available capacity: 0 kW
1.6 Expected annual production: 591,300,000 kWh.
1.7 Expected Firm Operation for each phase:
.Phase I 04/1/89,
Phase II 07/1/89
Phase III 10/1/89
1.8 Contract Term: 20 years,
1.9 Operating options pursuant to Section 5: (Check One)
__Operating Option I. Entire Generator output dedicated to Edison. No electric
service or standby service required.
X Operating option II. Entire Generator output dedicated to Edison with
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separate electric service required.
a. Electric service Tariff Schedule No. TOU-8 pursuant t on 10.2.
b. Contract demand 0 kW. operating
__Option III Excess generator output dedicated to Edison with Seller serving
own load.
a. Electric service Tariff Schedule No. pursuant to Section 10.2.
b. Contract demand kW
c. Standby Demand kW pursuant to Section 10.2.
d. Maximum electrical requirements expected kW.
e. Standby electric service Tariff Schedule No. - pursuant to Section 10.2.
f. minimum monthly charge for standby service
1.10 Interconnection Facilities Agreement pursuant to Section 6 shall be:
(Check One)
__Added Facilities Basis (Appendix A.1)
__Capital Contribution Basis (Appendix A.2)
__Seller Owned and Operated Basis (Appendix A.3)
1.11 The Capacity Payment Option selected by Seller pursuant to Section 9.1
shall be: (Check One)
__Option A - As-available capacity based upon.:
__Standard Offer No. 1 Capacity Payment Schedule, or
__Forecast of Annual As-Available Capacity Payment Schedule. The as-available
capacity price (first year): $___ kW-year.
X Option B - Firm Capacity (check one)
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X Standard Offer No. 2 Capacity Payment Schedule in effect at tine of
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Contract execution.
__Standard offer No. 2 Capacity Payment Schedule in effect at tine of Firm
operation of firm Operation of first generating unit.
Contract Capacity Price: $175.00 c /KW-YR (Firm Capacity).
1.12 The Energy Payment Option selected by Seller pursuant to Section 9.2
shall be: (Check One)
X Option 1 Forecast of Annual Marginal Cost of Energy in effect at (late of
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(execution of this Contract. (Appendix B)
__Option 2 Levelized Forecast of Marginal Cost of Energy in effect at date of
execution of this Contract. Levelized Forecast for expected date of Firm
Operation is___c/kWh. If' Seller's Generating Facility is an oil/natural gas
fueled cogenerator, Seller may' not select Option 2.
For the energy payment refund pursuant to Section 9.5 under option 2, Edison's
Incremental Cost of Capital is___%. Seller may change once between Options 1
and 2, provided Seller delivers written notice of such change at least 90 days
prior to the date of Firm Operation. For Option 1 or 2, Seller elects to
receive the following percentages in 20% increments the total of which shall
equal 100%:
100 Percent of Forecast of marginal Cost of Energy (Annual or Levelized), not
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to exceed 20% of the annual forecast for oil/natural gas fueled cogenerators,
and
___Percent of Edison's published avoided cost of energy based on Edison's full
avoided operating costs as updated periodically and accepted by the
Commission.
1.13 Metering Location (Check one)
Seller elects metering location pursuant to Section 8 as follows:
___Edison's side of the Interconnection Facilities
X Seller's side, of the Interconnection Facilities. Loss compensation factor
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is equal to (to be determined), pursuant to Section 8.3.
General Terms & Conditions
2. Definitions
When used with initial capitalizations, whether in the singular or in the
plural, the following terms shall have the following meanings-:
2.1 Adjusted Capacity Price: The $/kW-yr capacity purchase price based on the
Capacity Payment Schedule in effect at time of Contract execution for the time
period beginning on the date of Firm operation for the first generating unit
and ending on the date of termination or reduction of Contract Capacity under
Capacity Payment Option B.
2.2 Appendix A.l: Interconnection Facilities Agreement -- Added Facilities
Basis
2.3 Appendix A.2: Interconnection Facilities. Agreement -- Capital
Contribution Basis
2.4 Appendix A.3: Interconnection Facilities Agreement -- Seller Owned and
Operated Basis
2.5 Appendix B: Forecast of Annual Marginal Cost of Energy
2.6 Capacity Payment Schedule(s): Published capacity payment schedules as
authorized by the commission for as-available or firm capacity.
2.7 Cogeneration Facility: The facility and equipment which sequentially
generate thermal and electrical energy as defined in Title 18, Code of Federal
Regulations, Section 292.202.
2.8 Commission: The Public Utilities Commission of the State of California.
2.9 Contract: This document and Appendices, as amended from time to time.
2.10 Contract Capacity: The electric power producing capability of the
Generating Facility which is committed to Edison.
2.11 Contract Capacity Price: The capacity purchase price from the Capacity
Payment Schedule approved by the Commission for Capacity Payment Option B.
2.12 Contract Term: Period in years commencing with date of Firm Operation for
the first generating unit(s) during which Edison shall purchase electric power
from Seller.
2.13 Current Capacity Price: The $/kW-yr capacity price provided in the
Capacity Payment Schedule determined by the year of termination or reduction
of Contract Capacity and the number of years from such termination or
reduction to the expiration of the Contract Term for Capacity Payment Option
B.
2.14 Edison: The Southern California Edison Company.
2.15 Edison Electric System integrity: The state of operation of Edison's
electric system in a manner which is deemed to minimize the risk of injury to
persons and/or property and enables Edison to provide adequate and reliable
electric service to its customers.
2.16 Emergency: A condition or situation which in Edison's sole judgment
affects Edison Electric System Integrity.
2.17 Energy: Kilowatthours generated by the Generating Facility which are
purchased by Edison at the Point of Interconnection.
2.18 Firm Operation: The date agreed on by the Parties on which each
generating unit(s) of the Generating Facility is determined to be a reliable
source of generation and on which such unit can be reasonably expected to
operate continuously at its effective rating (expressed in kW).
2.19 First Period: The period of the Contract Term specified in Section 3.1.
2.20 Forced Outage: Any outage other than a scheduled outage of the Generating
Facility that fully or partially curtails its electrical output.
2.21 Generating Facility: A11 of Seller's generators, together with all
protective and other associated equipment and improvements necessary to
produce electrical power at Seller's Facility excluding associated land, land
rights, and interests in land.
2.22 Generator: The generators and associated prime mover(s), which are a part
of the Generating Facility.
2.23 Interconnection Facilities: Those protection, metering, electric line(s),
and other facilities required in Edison's sole judgment to permit an
electrical interface between Edison's system and the Generating Facility in
accordance with Edison's Tariff Rule No. 21 titled Cogeneration and Small
Power Production Interconnection Standards filed with the Commission.
2.24 Interconnection Facilities Agreement: That document which is specified in
Section 1.10 and is attached hereto.
2.25 KVAR: Reactive kilovolt-ampere, a unit of measure of reactive power.
2.26 Operate: To provide the engineering, purchasing, repair, supervision,
training, inspection, testing, protection, operation, use, management,
replacement, retirement, reconstruction, and maintenance of and for the-
,Generating Facility in accordance with applicable California utility
standards and good engineering practices .
2.27 Operating Representatives: Individuals appointed by each Party for the
purpose of securing effective cooperation and interchange of information
between the Parties in connection with administration and technical matters
related to this Contract.
2.28 Parties: Edison and Seller.
2.29 Party: Edison or Seller.
2.30 Peak Months: Those months which the Edison annual system peak demand
could occur. Currently, but subject to change with notice, the peak months for
the Edison system are June, July, August, and September.
2.31 Point of Interconnection: The point where the transfer of electrical
energy between Edison and Seller takes place.
2.32 Project: The Generating Facility and Interconnection Facilities required
to permit operation of Seller's Generator in parallel with Edison's electric
system.
2.33 Protective Apparatus: That equipment and apparatus installed by Seller
and/or Edison pursuant to Section A.2.
2.34 Qualifying Facility: Cogeneration or Small Power Production Facility
which meets the criteria as defined in Title 18, Code of Federal Regulations,
Section 292.201 through 292.207.
2.35 Second Period: The period of the Contract Term specified in Section 3.2.
2.36 Seller: The Party identified in Section 1.0.
2.37 Seller's Facility: The premises and equipment of Seller located as
specified in Section 1.2.
2.38 Small Power Production Facility: The facilities and equipment which use
biomass, waste, or Renewable Resources, including wind, solar, geothermal, and
water, to produce electrical energy as defined in Title 18, Code of Federal
Regulations, Section 292.201 through 292.207.
2.39 Standby Demand: Seller's electrical load requirement that Edison is
expected to serve when Seller's Generating Facility is not available.
2.40 Summer Period: Defined in Edison's Tariff Schedule No. TOU-8 as now in
effect or as nay 'hereafter be authorized by the Commission.
2.41 Tariff Schedule No. TOU-8: Edison's time-of-use energy tariff for
electric service exceeding 500 kW, as now 'in effect or as may hereafter be
authorized by the Commission.
2.42 Uncontrollable Forces: Any occurrence beyond the control of a Party which
causes that Party to be unable to perform its obligations hereunder and which
a Party has been unable to overcome by the exercise of due diligence,
including but not limited to flood, drought, earthquake, storm, fire,
pestilence, lightning and other natural catastrophes, epidemic, war, riot,
civil disturbance or disobedience, strike, labor dispute, action or inaction
of legislative, judicial, or regulatory agencies, or other proper authority,
which may conflict with the terms of this Contract, or failure, threat of
failure or sabotage of facilities which have been maintained in accordance
with good engineering and operating practices in California.
2.43 Winter Period: Defined in Edison's Tariff Schedule No. TOU-8 as now in
effect or as may hereafter be authorized by the Commission.
3. Term
This Contract shall be effective upon execution by the Parties and shall
remain effective until either Party gives 90 days prior written notice of
termination to the other Party, except that such notice of termination shall
not be effective to terminate this Contract prior to expiration of the
Contract Term specified in Section 1.8.
3.1 The First Period of the Contract Term shall commence upon date of Firm
Operation but not later than 5 years from the date of execution of this
Contract.
a. If the Contract Term specified in Section 1.8 is 15 years, the First Period
of the Contract Term shall be for 5 years.
b. If the Contract Term specified in Section 1.8 is 20 years or greater, the
First Period of the Contract Term shall be for 10 years.
3.2 The Second Period of the Contract Term shall commence upon expiration of
the First Period and shall continue for the remainder of the Contract Term.
4. Generating Facility
4.1 Ownership
4.1.1 The Generating Facility shall be owned by Seller.
4.1.2 Seller Warrants that it has the right to enter into this Agreement and
to sell the energy generated by the Project to-Edison under the terms of this
Agreement.
4.2 Design
4.2.1 Seller, at no cost to Edison, shall:
a. Design the Generating Facility.
b. Acquire all permits and other approvals necessary for the construction,
operation, and maintenance of the Generating Facility.
c. Complete all environmental impact studies, necessary for the construction,
operation, and maintenance of the Generating Facility.
d. Furnish and install the relays, meters, power circuit breakers,
synchronizer, and other control and Protective Apparatus as shall be agreed to
by the Parties as being necessary for proper and safe operation of the Project
in parallel with Edison's electric system.
4.2.2 Edison shall have the right to:
a. review the design of the Generating Facility's electrical system and the
Seller's Interconnection Facilities. Such review may include, but not be
limited to, the Generator, governor, excitation system, synchronizing
equipment, protective relays, and neutral grounding. The Seller shall be
notified in writing of the outcome of the Edison review within 30 days of the
receipt of all specifications for both the Generating Facility and the
Interconnection Facilities. Any flaws perceived by Edison in the design shall
be described in Edison's written notice.
b. Request modifications to the design of the Generating Facility's electrical
system and the Seller's Interconnection Facilities. Such modifications shall
be required if necessary to
maintain Edison Electric System Integrity when in parallel with the Edison
electric system.
4.2.3 if Seller's Generating Facility includes an induction-type generators,
Seller shall provide individual power factor correction capacitors for each
such generator. Such capacitors shall be switched on and off simultaneously
with each of the associated induction'-type generator(s) of the Generating
Facility.. The KVAR rating of such capacitors shall be the highest standard
value which will not exceed such generators no-load KVAR requirement. Seller
shall not install power factor correction in excess of that required by this
Section unless agreed to in writing by the Parties.
4.2.4 Seller shall not locate any part of a wind-driven generating unit of the
Generating Facility within a distance 1.25 times the height of a wind turbine
structure of an existing electric utility 33 kV, 66 kV, or 115 kV transmission
line right of way or within three rotor blade diameters of an existing
electric utility 220 kV or 500 kV transmission line right of way or any
proposed transmission line right of way of which Edison is pursuing regulatory
approval for construction.
4.2.5 If Seller's Generating Facility is a small hydro project, the Contract
Capacity in Section 1.5 shall be based on the average of the 5 lowest years of
stream flow taken from a study covering a minimum 50 years of continuous data.
The Parties may agree upon a shorter period if data for a 50-year period is
not obtainable.
4.3 Construction
Edison shall have the right to review, consult with, and make recommendations
regarding Seller's construction schedule and to monitor the construction and
start-up of the Project. Seller shall notify Edison, at least one year prior
to Firm Operation, of changes in Seller's Construction Schedule which may
affect the date of Firm Operation.
4.4 Operation
4.4.1 The Generating Facility and Seller's Protective Apparatus shall be
operated and maintained in accordance with applicable California utility
industry standards and good engineering practices with respect to
synchronizing, voltage and reactive power control. Edison shall have the right
to monitor operation of the Project and may require changes in Seller's method
of operation if such changes are necessary, in Edison's sole judgment, to
maintain Edison Electric System Integrity.
4.4.2 ,Seller shall notify in writing Edison's Operating Representative at
least 14 days prior to:
(a) the initial testing of Seller's Protective Apparatus; and
(b) the initial parallel operation of Seller's Generators with Edison's
electrical system. Edison shall have the right to have a representative
present at each event.
4.4.3 Edison shall have the right to require Seller to disconnect the
Generator from the Edison electric system or to reduce the electrical output
from the Generator into the Edison electric system, whenever Edison
determines, in its sole judgement, that such a disconnection is necessary to
facilitate maintenance of Edison's facilities, or to maintain Edison Electric
System Integrity. If Edison requires Seller to disconnect the Generator from
the Edison electric system pursuant to this Section 4-4.3, Seller shall leave
the right to continue to serve its total electrical requirements provided
Seller has elected Operating Option III. Each Party shall endeavor to correct,
within a reasonable period, the condition on its system which necessitates the
disconnection' or the retraction of electrical output. The duration of the
disconnection or the reduction in electrical output shall be limited to the
period of time such a condition exists.
4.4.4 The Generating Facility shall be operated with all of Seller's
Protective Apparatus in service whenever the Generator is connected to or is
operated in parallel with the Edison electric system. Any deviation for brief
periods of emergency or maintenance shall only be by agreement of the Parties.
4.4.5 Each Party shall keep the other Party's Operating Representative
informed as to the operating schedule of their respective facilities affecting
each other's operation hero under, including-any reduction in Contract
Capacity availability. In addition, Seller shall provide Edison with
reasonable advance notice regarding its scheduled outages including any
reduction in Contract Capacity availability. Reasonable advance notice is as
follows:
SCHEDULED OUTAGE ADVANCE NOTICE
EXPECTED DURATION TO EDISON
Less than one day 24 Hours
One day or more
(except major overhauls) 1 Week
Major overhaul 6 Months
4.4.6 Notification by each Party's Operating Representative of outage date and
duration should be directed to the other Party's Operating Representative by
telephone..
4.4.7 Seller shall not schedule major overhauls during Peak Months.
4.4.8 Seller shall maintain an operating log at Seller's Facility with records
of: real and reactive power production; changes in operating status, outages,
Protective Apparatus operations; and any unusual conditions found during
inspections. Changes in setting shall also be logged for Generators which are
"block-loaded" to a specific kW capacity. In addition, Seller shall maintain
records applicable to the Generating Facility, including the electrical
characteristics of the Generator and settings or adjustments of the Generator
control equipment and protective devices. Information maintained pursuant to
this Section 4.4.8 shall be provided to Edison, within 30 days of Edison's
request.
4.4.9 ,If, at any time, Edison doubts the integrity of any of Seller's
Protective Apparatus and believes 'that such loss of integrity would impair
the Edison Electric System Integrity, Seller shall demonstrate, to Edison's
satisfaction, the correct calibration and operation of the equipment in
question.
4.4.10 Seller shall test all protective devices specified in Section 4.2 with
qualified Edison personnel present at intervals not to exceed four years.
4-4.11 Seller shall, to the extent possible, provide reactive power for its
own requirements, and where applicable, the reactive power losses of
interfacing transformers. Seller shall not deliver excess reactive power to
Edison unless otherwise agreed upon between the Parties.
4.4.12 The Seller warrants that the Generating Facility meets the requirements
of a Qualifying Facility as of the date of Firm Operation and will continue to
meet such, requirements through the Contract Term
4.4.13 The Seller warrants that the Generating Facility shall at all tines
conform to all applicable laws and regulations. Seller shall obtain and
maintain any governmental authorizations and permits for the continued
operation of the Generating Facility. If at any time Seller does not hold such
authorizations and permits, Seller agrees to reimburse Edison for any loss
which Edison incurs as a result of the Seller's failure to maintain
governmental authorization and permits.
4.4.14 At Edison's request, Seller shall make all reasonable effort to -
deliver power at an average rate of delivery at least equal to the Contract
Capacity during periods of Emergency. In the event that the Seller has
previously scheduled an outage coincident with an Emergency, Seller shall make
all reasonable efforts to reschedule the outage. The notification periods
listed in Section 4.4.5 shall be waived by Edison if Seller reschedules the
outage.
4.4.15 Seller shall demonstrate the ability to provide Edison the specified
Contract capacity within 30 days of the (late of Firm Operation. Thereafter,
at least once per year at Edison's request, Seller shall ,,demonstrate the
ability to provide Contract Capacity for a reasonable period of tine as
required by Edison. Seller's demonstration of Contract Capacity shall be at
Seller's expense and conducted at a time and pursuant to procedures mutually
agreed upon by the Parties. If Seller fails to demonstrate the ability to
provide the Contract Capacity, the Contract Capacity shall be reduced by
agreement of the Parties pursuant to Section 9.1.2.6.
4.5 Maintenance
4.5.1 Seller shall maintain the Generating Facility in accordance with
applicable California utility industry standards and good engineering and
operating practices. Edison shall have the right to monitor such maintenance
of the Generating Facility. Seller shall maintain and deliver a maintenance'
record of the Generating Facility to Edison's Operating Representatives upon
request.
4.5.2 Seller shall make a reasonable effort to schedule routine maintenance
during off-Peak Months Outages for scheduled maintenance shall not exceed a
total of 30 peak 'hours for the Peak Months.
4.5.3 The allowance for scheduled maintenance is as follows:
a. Outage periods for scheduled maintenance shall not exceed 840 hours (35
days) in any 12-month period. This allowance may be used in increments of an
'hour or longer on a consecutive or nonconsecutive basis.
b. Seller may accumulate unused maintenance 'hours on a year-to-year basis up
to a maximum of 1,080 hours (45 days). This accrued time must be used
consecutively and only for major overhauls.
4.6 Any review by Edison of the design, construction, operation, or
maintenance of the Project is solely for the information of Edison. By making
such review, Edison makes no representation as to the economic and technical
feasibility, operational capability, or reliability of the Project. Seller
shall in no way represent to any third party that any such review by Edison of
the Project, including but not limited to, any review of the design,
construction, operation, or maintenance of the Project by Edison is a
representation by Edison as to the economic and technical feasibility,
operational capability, or reliability of said facilities. Seller is solely
responsible for economic and technical feasibility, operational capability, or
reliability thereof.
5. Operating Options
5.1 Seller shall elect in Section 1.9 to operate its Generating Facility in
parallel with Edison's electric system pursuant to one of the following
options:
a. Operating Option I: Seller dedicates the entire Generator output to Edison
with no electrical service required from Edison.
b. Operating Option II: Seller dedicates the entire Generator output to
Edison with electrical service required from Edison.
c. Operating Option III: Seller dedicates to Edison only that portion of the
Generator output in excess of Seller's electrical service requirements. As
much as practicable, Seller
intends to serve-its electrical requirements from the Generator output and
will require electrical standby from Edison as designated in Section 1.9.
5.2 After expiration of the First Period of the Contract Term, Seller may
change the Operating Option, but not more than once per year upon at least 90
days prior written notice to Edison. A reduction in Contract Capacity as a
result of a change in operating options shall be subject to Section 9.1.2.6.:
Edison shall not be required to remove or reserve capacity of Interconnection
Facilities made idle by a change in operating options. Edison may dedicate any
such idle Interconnection Facilities at any time to serve other customers or
to interconnect with other electric power sources. Edison shall process
requests for changes of operating option in the chronological order received.
5.2.1 When the Seller wishes to reserve Interconnection Facilities paid for by
the Seller but idled by a change in operation option, Edison shall impose a
special facilities charge related to the operation and maintenance of the
Interconnection Facility. When the Seller no longer needs said facilities for
which it has paid, the Seller shall receive credit for the net salvage value
of the Interconnection Facilities dedicated to Edison's use. if Edison is able
to make use of these facilities to serve other customers, the Seller shall
receive the fair market value of the facilities determined as of the date the
Seller either decides no longer to use said facilities or fails to pay the
required maintenance fee.
6. Interconnection Facilities
6.1 The Parties shall execute an Interconnection Facilities Agreement selected
by Seller in Section 1.10, covering the design, installation, operation and
maintenance of the Interconnection Facilities required in Edison's sole
judgment, to permit an electrical interface between the Parties pursuant to
Edison's Tariff Rule No. 21.
6.2 The cost for the Interconnection Facilities set forth in the appendices
specified in Section 1.10, are estimates only for Seller's information and
will be adjusted to reflect recorded costs after installation is complete;
except that, upon Seller's written request to Edison, Edison shall provide a
binding estimate which shall be the basis for the Interconnection Facilities
cost in the Interconnection Facilities Agreement executed by the Parties.
6.3 The nature of the Interconnection Facilities and the Point of
Interconnection shall be set forth either by equipment lists or appropriate
on-line diagrams and shall be attached to the appropriate appendix specified
in Section 1.10.
6.4 The design, installation, operation, maintenance, and modifications of the
Interconnection Facilities shall be at Seller's expense.
6.5 Seller shall not commence parallel operation of the Generating Facility
until written approval for operation of the Interconnection Facilities 'has
been received from Edison.
The Seller shall notify Edison at least forty-five days prior to the initial
energizing of the Point of Interconnection. Edison shall have the right to
inspect the Interconnection Facilities within thirty days of receipt of such
notice. If the facilities do not pass Edison's inspection, Edison shall
provide in writing the reasons for this failure within five days of the
inspection.
6.6 Seller, at no cost to Edison, shall acquire all permits and approvals and
complete all environmental impact studies necessary for the design,
installation, operation, and maintenance of the Interconnection Facilities.
7. Electric Lines And Associated
7.1 Edison shall, as it deems necessary or desirable, build electric lines,
facilities and other equipment, both overhead and underground, on and off
Seller's Facility, for the purpose of effecting the agreements contained in
this Contract. The physical location of such electric lines,- facilities and
other equipment on Seller's Facility shall be determined by agreement of the
Parties.
7.2 Seller shall reimburse Edison for the cost of acquiring property rights
off Seller's Facility required by Edison to meet its obligations under this
Contract.
7.3 Seller shall grant, or cause to be granted, to Edison, without cost to
Edison, and by an instrument of conveyance, acceptable to Edison, rights of
way'. easements and other property interests necessary to construct,
reconstruct, use, maintain, alter, add to, enlarge, repair, replace, inspect
and remove, at any time, the electric lines, facilities or other equipment,
both overhead and underground, which are required by Edison to effect the
agreements contained in the Contract and the rights of ingress and egress at
all reasonable times necessary for Edison to perform the activities
contemplated in the Contract.
7.4 The electric lines, facilities, or other equipment referred to in this
Section 7 installed by Edison on or off Seller's Facility shall be and remain
the property of Edison.
7.5 Edison shall have no obligation to Seller for any delay or "cancellation
due to inability to acquire a satisfactory right of way, easements, or other
property interests.
8. Metering
8.1 All meters and equipment used for the measurement of electric power for
determining Edison's payments to Seller pursuant to this Contract shall be
provided, owned, and maintained by Edison at Seller's expense in accordance
with Edison's Tariff Rule No. 21.
8.2 All meters and equipment used for billing Seller for electric service
provided to Seller by Edison under Operating Options 11 or III shall be
provided, owned, and maintained by Edison at Edison's expense in accordance
with Edison's Tariff Rule No. 16.
8.3 The meters and equipment used for measuring the Energy sold to Edison
shall be located on the side of the Interconnection Facilities as specified by
Seller in Section 1.13. If the metering equipment is located on Seller's side
of the Interconnection Facilities', then a loss compensation factor agreed
upon by the Parties shall be applied. At the written request of the Seller,
and at Seller's sole expense, Edison shall measure actual transformer losses.
if the actual measured value differs from the agreed-upon loss compensation
factor, the actual value shall be applied prospectively. If the meters are
placed on Edison's side of the Interconnection Facilities, service shall be
provided at the available transformer high-side voltage.
8.4 For purposes of monitoring the Generator operation and the determination
of standby charges, Edison shall have the right to require, at Seller's
expense, the installation of generation metering. Edison may also require the
installation of telemetering equipment at Seller's expense for Generating
Facilities equal to or greater than 10 fill. Edison may require the
installation of telemetering equipment at Edison's expense for Generating
Facilities less than 10 fill.
8.5 Edison's meters shall be sealed and the seals shall be broken only when
the meters are to be inspected, tested, or adjusted by Edison. Seller shall be
given reasonable notice of testing and have the right to 'nave its Operating
Representative present on such occasions.
8.6 Edison's meters installed pursuant to this Contract shall be tested by
Edison, at Edison's expense, at least once each year and at any reasonable
time upon request by either Party, at the requesting Party's expense. If
Seller makes such request, Seller shall reimburse said expense to Edison
within thirty days after presentation of a bill therefore.
8. 7 Metering equipment found to be inaccurate shall be repaired, adjusted, or
replaced by Edison such that the metering accuracy of said equipment shall be
within two percent. If metering equipment inaccuracy exceeds two percent, the
correct amount of Energy and Contract Capacity delivered during the period of
said inaccuracy shall be estimated by Edison and agreed upon by the Parties.
9. Power Purchase Provisions
Prior to the date of Firm Operation, Seller shall be paid for Energy only
pursuant to Edison's published avoided cost of energy based on Edison's full
avoided operating cost as periodically updated and accepted by the Commission.
If at any time Energy can be delivered to Edison and Seller is contesting the
claimed jurisdiction of any entity which 'has not issued a license or other
approval for the Project, Seller, in its sole discretion and risk, may deliver
Energy to Edison and for any Energy purchased by Edison Seller shall
receive payment from Edison for (i) Energy pursuant to this Section, and (ii)
as-available capacity based on a capacity price from the Standard Offer No. I
Capacity Payment Schedule as approved by the Commission. Unless and until all
required licenses and approvals have been obtained, Seller may discontinue
deliveries at any time.
9.1 Capacity Payments
Seller shall sell to Edison and Edison shall purchase from Seller capacity
pursuant to the Capacity Payment Option selected by Seller in Section 1.11.
The Capacity Payment Schedules will be based on Edison's full avoided
operating costs as approved by the Commission throughout the life of this
Contract. Data used to derive Edison's full avoided costs will be made
available to the Seller, to the extent specified by Seller upon request.
9.1.1 Capacity Payment Option A -- [Intentionally deleted]
9.1.2 ,Capacity Payment Option B -- Firm Capacity Purchase
If Seller selects Capacity Payment Option B, Seller shall provide to Edison
for the Contract Term the Contract Capacity specified in Section 1.5, or as
adjusted pursuant to Section 9.1.2.7, and Seller shall be paid as follows:
9.1.2.1 If Seller meets the performance requirements set forth in Section
9.1.2.2, Seller shall be paid a Monthly Capacity Payment, beginning from the
date of Firm Operation equal to the sum of the on-peak, mid-peak, and off-peak
Capacity Period Payments. Each Capacity Period Payment is calculated pursuant
to the following formula:
MONTHLY PERIOD CAPACITY PAYMENT A x B x C x D
Where A = Contract Capacity Price specified in Section 1.11 based on the
Standard offer No. 2 Capacity Payment Schedule as approved by the Commission
and in effect on the date of the execution of this Contract.
B = Conversion factors to convert annual capacity prices to monthly payments
by time of delivery as specified in Standard Offer No. 2 Capacity Payment
Schedule and subject to periodic modifications as approved by the Commission.'
C = Contract Capacity specified in Section 1.5.
D = Period Performance Factor, not to exceed 1.0, calculated as follows:
Period kWh purchased by Edison limited by the level of Contract Capacity 0.8 x
Contract Capacity x (period Hours minus Maintenance Hours Allowed in Section
4.5.)
9.1.2.2 Performance Requirements
To receive the Monthly Capacity Payment in Section 9.1.2.1, Seller shall
provide the Contract Capacity in each Peak Month for all on-peak hours as such
peak hours are defined in Edison's Tariff Schedule No. TOU-8 on file with the
Commission, except that Seller is entitled to a 20% allowance for Forced
Outages for each Peak month. Seller shall not be subject to such performance
requirements for the remaining hours of the year.
a. If Seller fails to meet the requirements specified in Section 9.1.2.2,
Edison may., in Edison's sole discretion, place Seller on probation for a
period not to exceed 15 months. if Seller fails to meet the requirements
specified in
9.1.2.2 during the probationary period, Edison may derate the Contract
Capacity to the greater of the capacity actually delivered during the
probationary period, or the capacity at which Seller can reasonably meet such
requirements. A reduction in contract Capacity as a result of this Section
9.1.2.2 shall be subject to Section 9.1.2.6.
b. If Seller fails to meet the requirements set forth in Section 9.1.2.2 due
to a Forced Outage on the Edison-system or a request to reduce or curtail
delivery under Section 9.4, Edison shall continue Monthly Capacity Payments
pursuant to Capacity Payment Option S. The Contract Capacity curtailed shall
be treated the same as scheduled maintenance outages in the Calculation of the
Monthly Capacity Payment.
9.1.2.3 If Seller is unable to provide Contract Capacity due to Uncontrollable
Forces, Edison shall continue Monthly Capacity Payments for 90 days from the
occurrence of the Uncontrollable Force. Monthly Capacity Payments payable
during a period of interruption or reduction by reason of an Uncontrollable
Force shall be treated the same as scheduled maintenance outages.
9.1.2.4 Hydroelectric facilities which 'have their Contract Capacity based on
the dry-year average, shall not have their Contract Capacity derated when
failure to meet the requirements set forth in Section 9.1.2.2 is due solely-
to the occurrence of. a dry year which -is drier than the five dry-year
average.
9.1.2.5 Capacity Bonus Payment For Capacity Payment Option B, Seller may
receive a Capacity Bonus Payment as follows:
a. Bonus During Peak months -- For a Peak month, Seller shall receive a
Capacity Bonus Payment if (i) the requirements set forth in Section 9.1.2.2
have been met, and (ii) the on-peak capacity factor exceeds 85%.
b. Bonus During lion-Peak Months -- For a non-peak month, Seller shall receive
a Capacity Bonus Payment if (i) the requirements set forth in Section 9.1.2.2
'have been met, (ii) the on-peak capacity factor for each Peak Month during
the year was at least 85%, and (iii) the on-peak capacity factor for the non-
peak month exceeds 85%.
c. For any eligible month, the' Capacity Bonus Payment shall be calculated as
follows:
CAPACITY BONUS PAYMENT = A x B x C x D
Where A = (1.2 x On-Peak Capacity Factor) -1.02 Where the On-Peak Capacity
Factor, not to exceed 1.0, is calculated as follows:
Period kWh purchased by Edison limited by the level of Contract Capacity
-------------------------------------------------------------------------
(Contract Capacity) x (Period Hours minus Maintenance Hours Allowed in
Section 4.5)
B = Contract Capacity Price specified in Section 1.11 for Capacity Payment
Option B
C = 1/12
D = Contract Capacity specified in Section 1.5
d. When Seller is entitled to receive a Capacity Bonus Payment, the Monthly
Capacity Payment shall be the sum of the Monthly Capacity Payment pursuant to
Section 9.1.2.1 and' the Monthly Capacity Bonus Payment pursuant to this
Section.
e. For Capacity Payment Option B, Seller shall be paid for capacity in excess
of Contract Capacity based on the as-available capacity price in Standard
Offer No. 1 Capacity Payment Schedule, as updated and approved by the
Commission. Seller shall not receive any as-available capacity payment in
excess of Contract Capacity if Seller's Generating Facility is a small hydro
project.
9.1.2.6 Capacity Reduction
a. Seller may reduce the Contract Capacity specified in Section 1.5, provided
that Seller gives Edison prior written notice for a period determined by the
amount of Contract Capacity reduced as follows:
Amount of Contract Length of
Capacity Reduced Notice Required
25,000 kW or under 12 months
25,001 - 50,000 kW 36 months
50,001 - 100,000 kW 48 months
over 100,000 kW 60 months
b. Subject to Section 10.4, Seller shall refund to Edison with interest at the
current published Federal Reserve Board three months prime commercial paper
rate an amount equal to the difference between (i) the accumulated Monthly
Capacity Payments paid by Edison pursuant to Capacity Payment Option B up to
the time the reduction notice is received by Edison, and (ii) the total
capacity payments which Edison would have paid if based on the Adjusted
Capacity Price.
c. From the date the reduction notice is received to the date of actual
capacity reduction, Edison shall make capacity payments based on the Adjusted
Capacity Price for the amount of Contract Capacity being reduced.
d. Seller may reduce Contract Capacity without the notice prescribed in
Section 9.1.2.6(a), provided that Seller shall refund to Edison the amount
specified in Section 9.1.2.6(b) and an amount equal to: (i) the amount of
Contract Capacity being reduced, times (ii) the difference between the Current
Capacity Price and the Contract Capacity Price, times (iii) the number of
years and fractions thereof (not less than one year) by which the Seller has
been deficient in giving prescribed notice. If the Current Capacity Price is
less than the Contract Capacity Price, only payment under Section 9.1.2.6(b)
shall be due to Edison.
9.1.2.7 Adjustment to Contract Capacity The Parties may agree in writing at
any time to adjust the Contract Capacity. Seller may reduce the Contract
Capacity pursuant to Section 9.1.2.6. Seller may increase e Contract Capacity
with Edison's approval and thereafter receive payment for the increased
capacity in accordance with the Contract Capacity Price for the Capacity
Payment option selected by Seller for the remaining Contract Term.
9.2 Energy Payments - First Period During the First Period of the Contract
Term, Seller shall be paid a Monthly Energy Payment for the Energy delivered
by the Seller to Edison at the Point of Interconnection pursuant to the Energy
Payment Option selected by Seller in Section 1.12, as follows. (Data used to
derive Edison's Energy payments for the First Period will be made available to
the Seller, to the extent specified by Seller, upon request.)
9.2.1 Energy Agreement Purchase Forecast of Annual marginal Cost of Energy. If
Seller selects Energy Payment Option 1, then during the First Period of the
Contract Term, Seller shall be paid a Monthly Energy Payment for Energy
delivered by Seller and purchased by Edison during each month in the % First
Period of the Contract Term pursuant to the following formula:
MONTHLY ENERGY PAYMENT (A x D) + (B x D) + (C x D)
Where A = kWh purchased by Edison during on-peak periods defined in Edison's
Tariff Schedule No. TOU-8.
B = kWh purchased by Edison during mid-peak periods defined in Edison's
Tariff Schedule No. TOU-8.
C = kWh purchased by Edison during off-peak periods defined in Edison's
Tariff Schedule No. TOU-8.
D = The sum of: (i) the appropriate time differentiated energy price from
the Forecast of Annual Marginal Cost of Energy, multiplied by the decimal
equivalent of the percentage of the forecast specified in Section 1.12, and
(ii) the appropriate time
differentiated energy price from Edison's published avoided cost of energy
multiplied by the decimal equivalent of the percentage of the published energy
price specified in Section 1.12.
9.2.2 Energy Payment Option 2 -- Levelized Forecast of Marginal Cost of
Energy. If Seller selects Energy Payment Option 2, then during the First
Period of the Contract Term, Seller shall be paid a Monthly Energy Payment for
Energy delivered by Seller and purchased by Edison each month during the First
Period of the Contract Term pursuant to the following formula:
MONTHLY ENERGY PAYMENT = (A x D) + (B x D) + (C x D)
Where A = kWh purchased by Edison during on-peak periods defined in Edison's
Tariff Schedule No. TOU-8.
B = kWh purchased by Edison during mid-peak periods defined in Edison's Tariff
Schedule No. TOU-8.
C = kWh purchased by Edison during off-peak periods defined in Edison's Tariff
Schedule No. TOU-8.
D = The sum of: (i) the appropriate time differentiated energy price from the
Levelized Forecast of Marginal Cost of Energy, for the First Period of the
Contract Term multiplied by the decimal equivalent of the percentage of the
levelized forecast specified in Section 1.12, and (ii) the appropriate time
differentiated energy price from Edison's published avoided cost of energy
multiplied by the decimal equivalent of the percentage of the published energy
price specified in Section 1.12.
9.2.2.1 Performance Requirement for Energy Payment Option 2
During the First Period when the annual forecast referred to in Section 9.2.1
is greater than the levelized forecast referred to in Section 9.2.2, Seller
shall deliver to Edison at least 70 percent of the average annual kWh
delivered to Edison during those previous periods when the levelized forecast
referred to in Section 9.2.2 is greater than the annual forecast referred to
in Section 9.2.1 as resource conditions permit for solar, wind, and hydro
Generating Facilities and excluding uncontrollable forces. If Seller does not
meet the Performance requirements of this Section 9.2.2.1, Seller shall be
subject to Section 9.5. 9.3 Energy Payments - Second Period During the Second
Period of the Contract Term, Seller shall be paid a Monthly Energy Payment for
Energy delivered by Seller and purchased by Edison at a rate equal to 100% of
Edison's published avoided cost of energy based on Edison's full avoided
operating cost as updated periodically and accepted by the Commission,
pursuant to the following formula:
MONTHLY ENERGY PAYMENT =
kWh purchased by Edison for each on-peak, mid-peak, and off-peak time period
defined in Edison's Tariff Schedule No. TOU-8 X Edison's published avoided
cost of energy by time of delivery for each time period.
Data used to derive Edison's full avoided costs will be made available to the
Seller, to the extent specified by Seller, upon request.
9.4 Edison shall not be obligated to accept or Pay for Energy, and may request
Seller whose Generating Facility is one (1) MWh or greater to discontinue or
reduce delivery of Energy, for not more than 300 hours annually during off-
peak hours when (i) purchases would result in costs greater than those which
Edison" would incur if it did not purchase Energy from Seller but instead
utilized an equivalent amount of Energy generated from another Edison source,
or (ii) the Edison Electric System demand would require that Edison hydro-
energy be spilled to reduce generation.
9.5 Energy Payment Refund If Seller elects Energy Payment Option 2, Seller
shall be subject to the following:
9.5.1 If Seller fails to perform the Contract obligations for any reason
during the First ..Period of the Contract Term, or fails to meet the
performance requirements set forth, in Section 9.2.2.1, and at the time of
such failure to perform, the net present value of the cumulative Energy
payments received by Seller pursuant to Energy Payment Option 2 exceeds the
net present value of what Seller would have been paid pursuant to Energy,
Payment Option 1, Seller shall make an energy payment refund equal to the
difference in such net present values in the year in which the refund is due.
The present value calculation shall be based upon the rate of Edison's
incremental cost of capital specified in Section 1.12.
9.5.2 Not less than 90 days prior to the date Energy is first delivered to the
Point of Interconnection, Seller shall provide and maintain a performance
bond, surety bond, performance insurance, corporate guarantee, or bank letter
of credit, satisfactory to Edison, which shall insure payment to Edison of the
Energy Payment Refund at any time during the First Period. Edison may, in its
sole discretion accept another form of security except that in such instance a
1-1/2 percent reduction shall then apply to the levelized forecast referred to
in Section 9.2.2 in computing payments for Energy. Edison shall be provided
with certificates evidencing Seller's compliance with the security
requirements in this Section which shall also include the requirement that
Edison be given 90 days. prior written notice of the expiration of such
security.
9.5.3 If Seller fails to provide replacement security not less than 60 days
prior to the date of expiration of existing security, the Energy Payment
Refund provided in Section 9.5 shall be payable forthwith. Thereafter,
payments for Energy shall be 100 percent of the Monthly Energy Payment
provided in Section 9.2.1.
9.5.4 If Edison at any time determines the security to be otherwise
inadequate, and so notifies Seller, payments thereafter for Energy shall be
100 percent of the Monthly Energy Payment provided in section 9.2.1. If within
30 days of the date Edison gives notice of such inadequacies, Seller satisfies
Edison's security requirements, Energy Payment Option 2 shall be reinstated.
If Seller fails to satisfy Edison's .'security requirements within the 30-day
period, the Energy Payment Refund provided in Section 9.5 shall be payable
forthwith.
10. Payment And Billing Provisions
10.1 For Energy and capacity purchased by Edison:
10.1.1 Edison shall mail to Seller not later' than thirty days after the end
of each monthly billing period (1) a statement showing the Energy and Contract
Capacity delivered to Edison during the on-peak, mid-peak, and off-peak
periods, as those periods are specified in Edison's Tariff Schedule No. TOU-8
for that monthly billing period, (2) Edison's computation of the amount due
Seller, and (3) Edison's check in payment of said amount.
10.1.2 If the monthly payment period involves portions of two different
published Energy payment schedule periods, the monthly Energy payment shall be
prorated on the basis of the percentage of days at each price.
10.1.3 If the payment period is less than 27 days or greater than 33 days, the
capacity ..,payment shall be prorated on the basis of the average days per
month per year.
10.1.4 If within' thirty days of receipt of the statement Seller does not make
a report in writing to Edison of an error, Seller shall be deemed to have
waived any error in Edison's statement, computation, and payment, and they
shall be considered correct and complete.
10.2 For electric service provided by Edison:
10.2.1 Under Operating Option III pursuant to Section 5.1, standby electric
service shall be provided under terms and conditions of Edison's tariff
schedule indicated below as now in effect or as may hereafter be authorized by
the Commission to be revised. The applicable tariff schedules are:
STANDBY TARIFF SCHEDULE NO ELECTRIC SERVICE TARIFF
SCG-1 TOU-8 or GS-2
SCG-2 TOU-8
SCG-3 TOU-8
10.2.1.1 (Applicable to SCG-1 only) The Standby Demand for calculation of the
standby charge in SCG-1 as specified in Section 1.9. Edison reserves the right
to adjust the Standby Demand based on recorded demand during periods standby
power is required.
10.2.1. 2 (Applicable to SCG-1 only) The capacity rating for determination of
standby waiver qualifications shall be Contract Capacity plus the maximum
electric load served by the Generating Facility during the on-peak time period
recorded during the preceding 12-month time period.
10.2.1.3 A minimum monthly charge may be established for standby electric
service as provided in the tariff schedule elected in Section 1.9. Said
minimum monthly charge shall be specified in section 1.9.
10.2.2 Under Operating Options II and III pursuant to Section 5.1, electric
service shall be provided under terms, conditions, and rates of Edison's
tariff schedule indicated below as now in effect or as may hereafter be
authorized by the Commission to be revised.
The applicable tariff schedule is:
TOU-8,
The contract demand for calculation of the minimum demand charge in the
applicable tariff schedules is specified in Section 1.9.
10.2.3 Edison shall commence billing Seller for electric service rendered
pursuant to the applicable tariff schedule on the date that the Point of
Interconnection is energized.
10.3 Monthly charges associated with Interconnection Facilities shall be
billed pursuant to the Interconnection Facilities Agreement contained in the
Appendix specified in Section 1.10.
10.4 Payments due to contract Capacity Reduction
10.4.1 The Parties agree that the refund and payments provided in Section
9.1.2.6 represent a fair compensation for the reasonable losses that would
result from such reduction of Contract Capacity.
10.4.2 In the event of a reduction in Contract Capacity, the quantity, in kW,
by which the Contract Capacity is reduced shall be used to calculate the
refunds and payments due Edison in accordance with Section 9.1.2.6, as
applicable.
10.4.3 Edison shall provide invoices to Seller for all refunds and payments
due Edison under this section which shall. be due within 60 days.
10.4.4 If Seller does not make payments as required in Section 10.4.3, Edison
shall 'have the right to offset any amounts due it against any present or
future payments due Seller and may pursue any other remedies available to
Edison as a result of Seller's failure to perform.
10.5 Energy Payment Refund Energy Payment Refund is immediately due and
payable upon Seller's failure to perform the contract obligations as specified
in Section 9.5.
11. Taxes
11.1 Seller shall pay ad valorem taxes and other taxes properly attributable
to the Project. If such taxes are assessed or levied against Edison, Seller
shall pay Edison for such assessment or levy.
11.2 Seller shall pay ad valorem taxes and other taxes properly attributed to
land, land rights, or interest in land for the Project. If such taxes are
assessed or levied against Edison, Seller shall pay Edison for such assessment
or levy.
11.3 If the Interconnection Facilities are owned by Edison, Edison shall pay
ad valorem taxes and other taxes properly attributed to said facilities. If
such taxes are assessed or levied against Seller, Edison shall pay :Seller for
such assessment or levy.
11.4 Seller or Edison shall provide information concerning the Project to any
requesting taxing authority.
12. Termination
12.1 This Contract shall terminate if Firm Operation does not occur within 5
years of the date of Contract execution.
13. Liability
13.1 Each Party (First Party) releases the other Party (Second Party), its
directors, officers, employees and agents from any loss, damage, claim, cost,
charge, or expense of any kind or nature (including any direct, indirect or
consequential loss, damage, claim, cost, charge, or expense), including
attorney's fees and other costs of litigation incurred by the First Party in
connection with damage to property of the First Party caused by or arising out
of the Second Party's construction, engineering, repair, supervision,
inspection, testing, protection, operation, maintenance, replacement,
reconstruction, use or ownership of its facilities, to the extent that such
loss, damage, claim, cost, charge, or expense is caused by the negligence of
Second Party, its directors, officers, employees, agents, or any person or
entity whose negligence would be imputed to Second Party.
13.2 Each Party shall indemnify and 'hold harmless the other Party, its
directors, officers, and employees or agents from and against any loss,
damage, claim, cost, charge, (including direct, indirect or consequential
loss, damage, claim, cost charge, or expense), including attorney's fees and
other costs of litigation incurred by the other Party in
connection with the injury to or death of any person or damage to property of
a third party arising out of the indemnifying Party's construction,
engineering, repair, supervision, inspection, testing, protection, operation,
maintenance, replacement, reconstruction, use, or ownership of its facilities,
to the extent that such loss, damage, claim, cost, charge, or expense is
caused by the negligence of the indemnifying Party, its directors, officers-,
employees, agents, or any person or entity whose negligence would be imputed
to the indemnifying Party, provided, however, that each Party shall be solely
responsible for and shall bear all cost of claims brought by its contractors
or its own employees and shall indemnify and 'hold harmless the other Party
for any such costs including costs arising out of any workers compensation
law. Seller releases and shall defend, and indemnify Edison from, any claim,
cost, loss, damage, or liability arising from any contrary representation
concerning the effect of Edison's review of the design, construction,
operation, or maintenance of the Project.
13.3 The provisions of this Sect-ion 13 shall not be construed so as to
relieve any insurer of its obligations to pay any insurance claims in
accordance with the provisions of any valid insurance policy.
13.4 Neither Party shall be indemnified under this Section 13 for its
liability or loss resulting from its sole negligence or willful misconduct.
14. Insurance
14.1 Until Contract is terminated, Seller shall obtain and maintain in force
as hereinafter provided comprehensive general liability insurance, including
contractual liability coverage, with a combined single limit of (i) not less
than $1,000,000 each occurrence for Generating Facilities 100 kW or greater;
(ii) not less than $500,000 for each occurrence for Generating Facilities
between 20 kW and 100 kW; and (iii) not less than $100,000 for each occurrence
for Generating Facilities less than 20 kW. The insurance carrier or carriers
and form of policy shall be subject to review and approval by Edison.
14.2 Prior to the date Seller's Generating Facility is first operated in
parallel with Edison's electric system, Seller shall (i) furnish certificate
of insurance to Edison, which certificate shall provide that such insurance
shall not be terminated nor. expire except on thirty days prior written notice
to Edison, (ii) maintain such insurance in effect for so long as Seller's
Generating Facility is operated in parallel with Edison's electric system, and
(iii) furnish to Edison an additional insured endorsement with respect to such
insurance in substantially the following form: "In consideration of the
premium charged, Southern California Edison Company (Edison) is named as
additional insured with respect to all liabilities arising out of Seller's use
and ownership of Seller's Generating Facility." "The inclusion of more than
one insured under this policy shall not operate to impair the rights of one
insured against another insured and the coverages afforded by this policy will
apply as though separate policies had been issued to each insured. The
inclusion of more than one insured will not, however, operate to increase the
limit of the carrier's liability.
Edison will not, by reason of its inclusion under this policy, incur liability
to the insurance carrier for payment of premium for this policy.' Any other
insurance carried by Edison which may be applicable shall be deemed excess
insurance and Seller's insurance primary for all purposes despite any
conflicting provisions in Seller's policy to the contrary." If the requirement
of Section 14.2(iii) prevents Seller from obtaining the insurance required in
Section 14.1 then upon written notification by Seller to Edison, Section
14.2(iii) shall be waived.
14.3 The requirements of this Section 14 shall not apply to Seller who is a
self-insured governmental agency with established record of self-insurance.
14.4 If Seller fails to comply with the provisions of this Section 14, Seller
shall, at its own cost, defend, indemnify, and hold harmless Edison, its
directors, officers, employees, agents, assigns, and successors in interest
from and against any and all loss, damage, claim, cost, charge, or expense of
any kind of nature (including direct, indirect or consequential loss, damage,
claim, cost, charge, or expense, including attorney's fees and other costs of
litigation) resulting from the death or injury to any person or damage to any
property, including the personnel and property of Edison, to the extent that
Edison would have been protected 'had Seller complied with all of the
provisions of this section 14.
15. Uncontrollable Forces
15.1 Neither Party shall be considered to be in default in the performance of
any of the agreements contained in this Contract, except for obligations to
pay money, when and to the extent failure of performance shall be caused by an
Uncontrollable Force.
15.2 If either Party because of an Uncontrollable Force is rendered wholly or
partly unable to perform its obligations under this Contract, the Party shall
be excused from whatever performance is affected by the Uncontrollable Force
to the extent so affected provided that:
(1) the nonperforming Party, within two weeks after the occurrence of the
Uncontrollable Force, gives the other Party written notice describing the
particulars of the occurrence,
(2) the suspension of performance is of no greater scope and of no longer
duration than is required by the Uncontrollable Force,
(3) the nonperforming Party uses its best efforts to remedy its inability to
perform (this subsection shall not require the settlement of any strike,
walkout, lockout or other labor dispute on terms which, in the sole judgment
of the Party involved in the dispute, are contrary to its interest. It is
understood and agreed that the settlement of strikes, walkouts, lockouts or
other labor disputes shall be at the sole discretion of the Party having the
difficulty),
(4) when the nonperforming Party is able to resume performance of its
obligations under this Contract, that Party shall give the other Party written
notice to that effect, and
(5) capacity payments during such periods of Uncontrollable Force on Seller's
part shall be governed by Section 9.1.1.3.
15.3 In the event that either Party's ability to perform cannot be corrected
when the Uncontrollable Force is caused by the actions or inactions of
legislative, judicial or regulatory agencies or other proper authority, this
Contract may be amended to comply with the legal or regulatory change which
caused the nonperformance. If a loss of Qualifying Facility. status occurs due
to an Uncontrollable Force and Seller fails not to make the changes. necessary
to maintain its Qualifying Facility status, the Seller shall compensate Edison
for any economic detriment incurred by Edison as a result of such failure.
16. Nondedication Of Facilities
Neither Party, by this Contract, dedicates any part of its facilities involved
in this Project to the public or to the service provided under the Contract,
and such service shall cease upon termination of the Contract.
17. Priority Of Documents
If there is a conflict between this document and any Appendix, the provisions
of this document shall govern. Each Party shall notify the other immediately
upon the determination of the existence of any such conflict.
18. Notices And Correspondence
All notices and correspondence pertaining to this Contract shall be in writing
and shall be sufficient if delivered in person or sent by certified mail,
postage prepaid, return receipt requested to Seller as specified in Section
1.1, or to Edison as follows:
Southern California Edison Company,
Post Office Box,
Rosemead, California 91770,
Attention: Secretary
All notices sent pursuant to this Section 18 shall be effective when received,
and each Party shall be entitled to specify as its proper address any other
address in the 'United States upon written notice to the 'other Party.
19. Previous Communications
This Contract contains the entire agreement and understanding between the
Parties, their agents, and employees as to the subject matter of this
contract, and merges and supersedes all prior agreements, commitments,
representations, and discussions between the Parties. No Party shall be bound
to any other obligations, conditions, or representations with respect to the
subject matter of this Contract.
20. Nonwaiver
None of the provisions of the Contract shall be considered waived by either
Party except when such waiver is given in writing. The failure of either
Edison or Seller to insist on any one or more instances upon strict
performance of any of the provisions of the Contract 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 continue to remain in full force and effect.
21. Successors And Assigns
Neither Party shall voluntarily assign its rights nor delegate its duties
under this Contract, or any part of such rights or duties, without the written
consent of the other Party, except in connection with the sale or merger of a
substantial portion of its properties. Any such assignment or delegation made
without such written consent shall be null and void. Consent for assignment
shall not be withheld unreasonably. Such assignment shall include, unless
otherwise specified therein, all of Seller's rights to any refunds which might
become due under this Contract.
22. Effect Of Section Headings
Section headings appearing in this Agreement are inserted for convenience
only, and shall not be construed as interpretations of text.
23. Governing Law
This Contract shall be interpreted, governed, and construed under the laws of
the State of California as if executed and to be performed wholly within the
State of California.
24. Multiple Originals
This Contract is executed in two counterparts, each of which shall be deemed
an original.
Signatures
IN WITNESS WHEREOF, the Parties hereto have executed this Contract this 1st of
February ,1985
SOUTHERN CALIFONIA EDISON COMPANY
By: /s/ Edward A. Myers
---------------------
Edward A. Myers
Vice President
CHINA LAKE JOINT VENTURE
By CALIFORNIA ENERGY COMPANY,INC.
By: /s/ David L. Ludvigson
------------------------
David L. Ludvigson
Executive Vice President