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EXHIBIT 10.35
STANDARD OFFER SERVICE
WHOLESALE SALES AGREEMENT
THIS STANDARD OFFER SERVICE WHOLESALE SALES AGREEMENT ("Agreement")
dated as of October 29, 1999, is by and between THE CONNECTICUT LIGHT AND POWER
COMPANY ("CL&P" or "Buyer") and NRG POWER MARKETING INC. ("Seller"). The Seller
and Buyer together are the Parties and each individually is a Party to this
Agreement.
WITNESSETH:
WHEREAS, pursuant to Section 20(b) of Public Act 98-28, An Act
Concerning Electric Restructuring ("Act"), the Buyer must procure generation for
the purpose of providing Standard Offer Service to those end use consumers of
electricity within its traditional retail service area ("Retail Customers") that
do not or are unable to choose an Electric Supplier (as defined in Section 1(30)
of the Act);
WHEREAS, by Order dated July 7, 1999, in Docket No. 99-03-36, the
Connecticut Department of Public Utility Control ("DPUC") approved, with certain
modifications, the Buyer's proposal to issue a competitive bid solicitation, or
Request For Proposals, for generation service to supply fifty percent of the
Buyer's Standard Offer Service Load ("the RFP");
WHEREAS, the DPUC has retained J.P. Morgan Securities, Inc. ("J.P.
Morgan") to act as the exclusive agent to the DPUC to conduct the RFP;
WHEREAS, J.P. Morgan carefully evaluated the responses to the RFP,
including the response submitted by the Seller, and advised that the Seller is a
qualified bidder pursuant to the RFP, and that the Seller's offer to supply a
portion of the Standard Offer Service Load meets the standards for selection in
the RFP, subject to negotiating an acceptable agreement to supply Standard Offer
Service;
WHEREAS, this Agreement sets forth the rates, terms and conditions
under which the Seller will supply firm all-requirements service as necessary to
serve a specified share of the Buyer's aggregate retail load that takes Standard
Offer Service during the term of this Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the Parties to this Agreement covenant and agree as
follows:
1. DEFINITIONS
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As used throughout this Agreement, the following terms shall have the
definitions set forth in this Article 1.
1.1 "BACK-UP SERVICE" means generation services provided to any
Retail Customer that has entered into a service contract with
an alternative supplier who, in turn, fails to provide
generation services to such Retail Customer other than due to
the Retail Customer's failure to pay for such services.
1.2 "CONTRACT LOAD QUANTITY" means the portion of the Standard
Offer Service Load, defined as a monthly total, for which the
Seller is obligated to supply SOS Requirements Power pursuant
to Section 3.5 of this Agreement. The Contract Load Quantity
shall be calculated in accordance with Appendix A.
1.3 "DELIVERY POINT" means any point on the NEPOOL PTF, or one or
more other points of interconnection between the Buyer's
transmission or distribution system and generating assets
owned or contracted for by the Seller, where Seller delivers
SOS Requirements Power to the Buyer, and at which point title
to and liability for electricity passes from the Seller to the
Buyer; provided, however, that the Seller shall assume all of
the risk that it will not obtain NEPOOL credit for power that
is not delivered to the NEPOOL PTF; and provided further that,
from the standpoint of the rights and benefits received by the
Buyer under this Agreement, all power delivered hereunder
shall be treated in the same manner as if the power had been
delivered to the NEPOOL PTF.
1.4 "DELIVERY SERVICES" means the combination of Regional Network
Service ("RNS") over NEPOOL PTF acquired pursuant to the
NEPOOL Transmission Tariff, Local Network Service ("LNS") over
the Buyer's Non-Pool Transmission Facilities pursuant to the
NU Operating Companies open access transmission tariff, and
firm distribution services under the Buyer's distribution
service tariff that are provided by the Buyer for the delivery
of SOS Requirements Power for the Contract Load Quantity.
Delivery Services shall not include losses, congestion
charges, ancillary services or any ISO charges associated with
SOS Requirements Power, all of which shall be the
responsibility of the Seller.
1.5 "ISO" means ISO New England, Inc., the Independent System
Operator for the NEPOOL Control Area, or any successor
thereto.
1.6 "MATERIAL ADVERSE EFFECT" as used in Sections 10.1 and 10.2
means any change in, or effect on the Buyer or Seller after
the date of this Agreement and prior to the Effective Date
that is materially adverse to any of the transactions
contemplated hereby, other than (i) any change or effect
resulting from changes in the international, national,
regional or local wholesale or retail markets for electric
power; (ii) any change or effect
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resulting from changes in the international, national,
regional or local wholesale or retail markets for any fuel
used by the Seller; (iii) any change or effect resulting from
changes in the North American, national, regional or local
electric transmission systems; (iv) any change or effect
resulting from any action or inaction by a legislative or
regulatory authority, other than failure of any state or
federal governmental authority or commission to give any
consent or approval.
1.7 "NEPOOL" means the New England Power Pool, the power pool
created by and operated pursuant to the provisions of the
Restated NEPOOL Agreement, as such agreement may be amended
from time to time.
1.8 "NEPOOL CONTROL AREA" means the geographic area in which the
ISO is responsible for maintaining transmission lines within
established security limits and for balancing the sum of
internal generation and net interchange with the control area
load at all times in order to maintain system stability,
reliability and frequency within acceptable limits.
1.9 "NEPOOL PTF" means the facilities categorized as Pool
Transmission Facilities as defined in the Restated NEPOOL
Agreement.
1.10 "SOS REQUIREMENTS POWER" means the firm wholesale power that
Seller is obligated to deliver as defined in Section 3.1.
1.11 "SOS SUPPLIER BILLING AMOUNT" means the monthly billing
quantity as determined in accordance with Appendix A.
1.12 "STANDARD OFFER SERVICE" OR "SOS" means the electric service
provided in accordance with Section 20(b) of the Act and the
implementing rules and regulations of the DPUC to those Retail
Customers of the Buyer that do not purchase electricity from
an Electric Supplier.
1.13 "STANDARD OFFER SERVICE LOAD" means the aggregate consumption
of all of CL&P's Standard Offer Service customers plus the
aggregate electric losses for delivery from a Delivery Point
to the end-use meters of all such customers as determined in
accordance with Appendix A.
1.14 "TERM" means the period during which the Seller is obligated
to supply SOS Requirements Power pursuant to this Agreement.
The Term shall be for four (4) calendar years commencing at
the hour ending 0100 on January 1, 2000, and terminating at
the hour ending at 2400 on December 31, 2003, unless this
Agreement is terminated earlier pursuant to its terms.
1.15 "TRANSITION AGREEMENT" means the Agreement for Transition
Power Supply between and among The Connecticut Light And Power
Company, NRG Energy, Inc., NRG Power Marketing Inc., Montville
Power LLC,
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Middletown Power LLC, Devon Power LLC, Norwalk Power LLC, and
Connecticut Jet Power LLC, pursuant to which the parties to
such agreement have arranged for the Buyer to acquire rights
to power between the date of closing of the sale of certain of
the Seller's generating assets to NRG Energy, Inc. and the
commencement of SOS, or for the Seller to acquire rights to
power from the date of commencement of SOS to the date of
closing of the sale of such CL&P generating assets to NRG
Energy, Inc.
2. EFFECTIVE DATE AND FILING
2.1 This Agreement shall be binding on the Parties as of the date
it is executed by both Parties ("Effective Date"); provided
that the provision of SOS Requirements Power by the Seller
shall be subject to obtaining necessary regulatory
authorizations for providing such service. Promptly after
execution hereof, the Seller shall file this Agreement with
the Federal Energy Regulatory Commission ("FERC") and shall
request that the FERC accept this Agreement for filing without
modification or condition, with service hereunder to be
effective commencing on January 1, 2000. The Buyer shall
support such filing. In addition, the Buyer shall, promptly
after execution hereof, submit this Agreement to the DPUC for
its approval as set forth in the RFP. The Seller shall bear
the cost of the FERC filing described above except for the
costs associated with the Buyer's intervention. The Buyer
shall bear the cost of the DPUC filing described above except
for the cost of the Seller's intervention. In each case, the
Party responsible for filing this Agreement shall request that
the regulatory agency give confidential treatment to the
pricing terms of this Agreement, which are the result of a
competitive solicitation held by the Buyer.
2.2 In the event that the FERC or the DPUC grants conditional
approval of this Agreement, compliance with which would create
a material adverse economic impact on a Party, the adversely
affected Party may seek to negotiate such changes to this
Agreement as may be necessary to restore the balance of
consideration hereunder while simultaneously complying with
the FERC and DPUC orders. If the Parties are unable to
negotiate such changes that are satisfactory to each Party
within five (5) business days after the FERC or DPUC order,
either Party shall have the right to terminate this Agreement
by giving five (5) days written notice to the other Party, in
which event the Agreement shall be null and void and of no
further force and effect from and after the date of
termination. In the event that the FERC or the DPUC does not
accept the changes negotiated by the Parties hereunder, either
Party shall have the right to terminate this Agreement upon
thirty (30) days' written notice to the other Party, in which
event the Agreement shall be null and void and of no further
force and effect from and after the date of termination.
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2.3 The applicable provisions of this Agreement shall continue in
effect after expiration of the Term (or earlier termination as
provided herein) to the extent necessary to provide for final
accounting, final billing, billing adjustments, resolution of
any billing dispute, resolution of any court or administrative
proceeding and final payments.
3. SALE AND PURCHASE OF SOS REQUIREMENTS POWER
3.1 SOS Requirements Power is the wholesale power delivered at the
Delivery Point(s) that is supplied at all times and in
quantities reflecting the full requirements for power of
Retail Customers purchasing Standard Offer Service from CL&P.
SOS Requirements Power shall be firm and shall vary in
quantity from minute to minute, hour to hour, day to day and
month to month based on the consumption patterns of Retail
Customers. SOS Requirements Power includes power supply and
ancillary services, in such amounts as are required for the
Buyer to serve the Contract Load Quantity plus losses at all
times throughout the Term. SOS Requirements Power includes all
of the power supply and ancillary services that are or may be
necessary to serve electrical load under the Restated NEPOOL
Agreement during the Term, including Energy, Installed
Capability, Operable Capability, Operating Reserves, Automatic
Generation Control, electrical losses, congestion charges
imposed under the NEPOOL Transmission Tariff, charges of the
ISO associated with NEPOOL membership and with serving the
Contract Load Quantity, and any future additions, deletions or
changes to the seven NEPOOL products (Energy, Installed
Capability, Operable Capability, 30-minute Non-Spinning
Operating Reserves, 10-Minute Spinning Reserves, 10-Minute
Non-Spinning Reserves, and Automatic Generation Control) that
are required for entities serving electrical load in NEPOOL.
SOS Requirements Power shall also include such transmission
and distribution delivery services as may be required for the
Seller to deliver SOS Requirements Power to the Delivery
Point(s). SOS Requirements Power shall not include any current
or future requirement to meet a renewable energy portfolio
standard in the State of Connecticut.
3.2 The Seller shall deliver and sell to Buyer at a Delivery Point
the Contract Load Quantity. The billing determinants on which
payment to Seller is based shall be determined in accordance
with Appendix A.
3.3 The Buyer shall receive and purchase power delivered by Seller
in accordance with this Section 3.
3.4 The Seller shall own or procure sufficient firm power supplies
and ancillary services to provide SOS Requirements Power
throughout the Term, and shall schedule all such power
supplies and ancillary services with the ISO
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for use by the Buyer in accordance with the provisions of the
Restated NEPOOL Agreement (including future amendments
thereto) and the applicable operating procedures of the ISO.
The Seller shall be responsible for all transmission and
distribution delivery costs, if any, required to deliver SOS
Requirements Power to the Delivery Point(s).
3.5 The Contract Load Quantity shall be equal to thirty-five (35)
percent of the Standard Offer Service Load during calendar
year 2000, forty (40) percent of the Standard Offer Service
Load during calendar years 2001 and 2002, and forty-five (45)
percent of the Standard Offer Service Load during calendar
year 2003.
3.6 The Buyer shall procure or arrange for Delivery Services in
order to accomplish the firm delivery of SOS Requirements
Power from the Delivery Point(s) to the Retail Customers
taking SOS Requirements Power throughout the Term; provided
that the Buyer's obligation to supply Delivery Services at and
from the Delivery Point(s) with respect to any particular
generating resource of the Seller shall be subject to the
availability of transmission service for such delivery under
the NEPOOL Transmission Tariff.
3.7 For the entire Term, the Seller shall either (1) be a member
of NEPOOL with its own load and settlement account established
in accordance with the rules of the ISO, or (2) contract with
a NEPOOL member for such member to include the Seller's load
in its own load and settlement account.
3.8 The Seller and Buyer shall comply with the procedures, rules
and regulations of the ISO and NEPOOL and the requirements of
the Restated NEPOOL Agreement as they may apply to the
purchase, sale and delivery of SOS Requirements Power.
3.9 The Seller shall be responsible for forecasting the Contract
Load Quantity for purposes of meeting its supply obligation
hereunder on a monthly, daily and hourly basis, for the full
Term of the Agreement. The Buyer's most recent forecasts of
energy sales and peak demand for its service area are set
forth in Appendix B for informational purposes. The Buyer will
supply the Seller with (1) any updates or material changes to
such forecasts made during the Term, (2) on a weekly basis,
the actual number of customers on Standard Offer Service
broken down by customer segment to the extent known, for the
previous week, and (3) within 37 hours after the close of the
day, the same supplier hourly loads the Buyer submitted to the
ISO on behalf of the Seller.
3.10 The Seller shall be responsible for and shall pay all ISO and
NEPOOL charges and expenses associated with the provision of
SOS Requirements Power, except for any such ISO or NEPOOL
charges that
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are imposed directly on the Buyer in connection with the
provision of Delivery Services by the Buyer.
3.11 The Seller shall be responsible for and shall pay all taxes,
fees, and levies that may be assessed by any entity in
connection with the provision of SOS Requirements Power except
for (1) such taxes, fees and levies that Buyer is allowed to
collect directly from the Retail Customers, and (2) such
taxes, fees and levies that are assessed directly to the Buyer
in connection with the provision of Delivery Services.
3.12 If and to the extent that, at any time during the Term, the
congestion management scheme in effect under the NEPOOL
Transmission Tariff provides for the automatic assignment of
rights to rebates of transmission congestion charges to retail
loads of the Buyer, the Seller shall be entitled to a portion
of such congestion rebate rights based on the ratio between
the Contract Load Quantity and the Buyer's retail load that is
subject to the automatic assignment of such rights.
4. CHARGE PROVISIONS
4.1 For and in consideration of the sale by the Seller to the
Buyer of SOS Requirements Power, the Buyer shall pay the per
unit charges set forth in the Table below for all SOS
Requirements Power supplied to Retail Customers during the
Term of this Agreement. The monthly quantity of SOS
Requirements Power to which the unit charges set forth herein
shall be applied for billing purposes, shall be the SOS
Supplier Billing Amount:
NRG POWER MARKETING
Table of Load Percentages and Charges
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5% LOAD 2000 2001 2002 2003
SHARE* (CENTS PER KWH) (CENTS PER KWH) (CENTS PER KWH) (CENTS PER KWH)
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1ST
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2ND
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3RD
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4TH
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5TH
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6TH
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7TH
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8TH -
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9TH - - -
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10TH - - - -
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4.2 The charges set forth in Section 4.1 are the result of a
competitive bid solicitation and shall apply for the entire
Term unless both Parties agree to a change in charges set
forth in a written amendment to the Agreement that is accepted
for filing by the FERC. Nothing in this Section 4.2 is
intended to modify Sections 2.2, 4.5, or 9.3 of this
Agreement.
4.3 It is the intent of the Parties that, except as provided in
Sections 4.5 and 9.3, or as the Parties otherwise agree,
neither the Seller and its affiliates nor the Buyer and its
affiliates shall have the unilateral right to make a filing
with the FERC under any Section of the Federal Power Act, or
with the DPUC, seeking to change the charges or any other
terms or conditions set forth in this Agreement for any
reason.
4.4 Neither Party shall instigate or cooperate with any effort of
third parties to petition the FERC or the DPUC to change any
term of the Agreement (which includes the charges and
quantities). If any third party nevertheless petitions the
FERC or the DPUC to establish a proceeding under Section 206
of the Federal Power Act, both Parties shall cooperate to seek
to dismiss such proceeding and to uphold the Agreement without
change. It is the intention of the Parties that any authority
of the FERC or the DPUC to change the Agreement be strictly
limited to that which applies when the contracting parties
have irrevocably waived their right to seek to have the FERC
or the DPUC change any term of this Agreement.
4.5 In the event that the DPUC modifies the rules relating to the
provision of Standard Offer Service during the Term, or
Connecticut enacts legislation that has the affect of
modifying the provisions of the Act relating to Standard Offer
Service, and such DPUC or legislative modifications would
materially adversely affect the rights and responsibilities of
either Party under this Agreement, the Party that believes it
would be materially adversely affected by such modifications
may request that the DPUC take action to protect the interests
of such Party. If the DPUC does not provide relief
satisfactory to such Party within sixty (60) days from the
date of filing of the request, the Parties shall enter into
good faith negotiations to amend this Agreement in a manner
designed to restore the original
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balance of consideration set forth herein. In the event that
the Parties are unable to reach agreement on such revisions to
this Agreement: (1) the Seller, if it is the adversely
affected Party, shall have the right unilaterally to make a
filing with the FERC pursuant to Section 205 of the Federal
Power Act and the FERC's rules and regulations thereunder, and
(2) the Buyer, if it is the adversely affected Party, shall
have the right to make a filing under Section 206 of the
Federal Power Act, seeking such changes to this Agreement,
including termination hereof, as such Party deems necessary
due solely to the DPUC's change or the new legislation. In the
case of any such filing, the other Party shall have the right
to intervene in opposition to the filing.
4.6 Upon request of the Buyer, the Seller shall, within three (3)
business days, submit a firm price quote for no less than a
pro rata share of the Buyer's Back-Up Service requirements,
with such pro rata share based on the ratio of the Contract
Load Quantity to the Buyer's Standard Offer Service Load, and
which quote shall be binding on the Seller for a period of no
less than a calendar month. If the Buyer accepts the Seller's
price quote during such calendar month period for any portion
of the amount of Back-Up Service covered by the quote, the
Seller shall supply additional SOS Requirements Power in
accordance with its price quote and the remaining terms and
conditions of this Agreement.
5. BILLING AND PAYMENT
5.1 As soon as practicable after the end of each month during the
Term, the Buyer shall supply the Seller its estimate of the
SOS Supplier Billing Amount for purposes of billing hereunder.
Within ten (10) days thereafter, the Seller shall submit a
bill to the Buyer for all applicable charges hereunder based
on such estimates.
5.2 Each bill rendered under this Agreement shall be subject to
adjustment in order to true-up charges based on estimated SOS
Supplier Billing Amount data to the adjusted SOS Supplier
Billing Amount, as defined in Appendix A. Promptly after the
adjustment to SOS Supplier Billing Amount has been determined,
the Buyer shall supply the adjusted SOS Supplier Billing
Amount to the Seller in order to enable the Seller to
calculate the final bill for SOS Requirements Power for each
month during the Term. The Seller shall prepare and send to
the Buyer an adjusted bill within ten (10) days after
receiving the adjusted SOS Supplier Billing Amount data from
the Buyer. All refunds or surcharges owed to either Party as a
result of differences between the estimated and adjusted SOS
Supplier Billing Amounts shall include the payment of interest
calculated in accordance with the regulations of the FERC
applicable to the payment of interest on
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refunds for the entire period between payment under the
original estimated bill and the final bill.
5.3 All bills, including any adjusted bills, shall bear the date
of rendering and be due and payable not later than thirty (30)
days after the date of rendering. Any amount remaining unpaid
after such thirty (30) days shall bear interest at the rate
set forth in the regulations of the FERC for interest payments
on refunds, from the due date to the date of payment by the
Buyer. All payments sent by the Buyer to the Seller shall be
by wire transfer or by certified check delivered using
overnight mail.
5.4 If the Buyer disputes the amount of any bill, it shall so
notify the Seller in writing. The Buyer shall pay to the
Seller any undisputed amount of the bill when due. The
disputed amount may, at the discretion of the Buyer, be held
by the Buyer until the dispute has been resolved; provided
that the Buyer shall be responsible to pay interest on any
withheld amounts that are determined to have been properly
billed, which shall be calculated in the same manner as
interest on late payments under Section 5.3. Neither Party
shall have the right to challenge any monthly bill or to bring
any court or administrative action of any kind questioning the
propriety of any bill after a period of twenty four (24)
months from the date the bill was due; provided, however, that
in the case of a bill based on estimates, such twenty-four
month period shall run from the due date of the final adjusted
bill.
5.5 In the event that the Buyer fails to pay the amount due by the
due date, the Seller may notify the Buyer that, unless payment
is received, it will be in default of its obligations under
this Agreement. The Buyer shall have thirty (30) days from the
date of receipt of such notification from the Seller to cure
its default. In the event that the default is not cured within
such 30 day period, the Seller, in addition to any other legal
or equitable remedies it may have, shall have the right to
terminate this Agreement upon five (5) days written notice to
the Buyer.
6. BILLING DETERMINANTS/SUPPLY OBLIGATION
6.1 The Buyer shall maintain meters capable of measuring the
energy use of Retail Customers taking SOS in accordance with
rules prescribed by the DPUC. The accuracy of all metering
equipment will be in accordance with the Buyer's normal
practices and DPUC requirements applicable to the Buyer's
retail distribution loads. The Seller hereby acknowledges and
accepts that Buyer does not maintain meters capable of
interval measurement for some of its retail load that will be
served under the SOS. The price, risk and other terms of this
Agreement have been negotiated based upon these conditions and
Buyer shall not be obligated to install
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interval metering equipment as a result of this Agreement. The
Parties agree that the obligation of the Buyer to pay for
power delivered and the obligation of the Seller to deliver a
specified quantity at an authorized Delivery Point shall be
determined in accordance with Appendix A.
7. LIABILITY FOR DELIVERY AND FORCE MAJEURE
7.1 The Seller shall be responsible for scheduling with or
purchasing from NEPOOL a sufficient amount of SOS Requirements
Power to satisfy its service obligations hereunder at all
times during the Term. To the extent that the Seller does not
own or has not acquired sufficient resources to satisfy this
obligation at any time during the Term, the Seller shall
purchase any deficiency from NEPOOL. Under no circumstances
shall the Buyer be responsible for acquiring power or
ancillary services to meet any portion of the Seller's SOS
Requirements Power supply obligation hereunder at any time
during the Term.
7.2 In the event that the Seller defaults on its material
obligations to the Buyer or NEPOOL in connection with this
Agreement at any time during the Term, and the Seller does not
cure such default within a time period allowed by NEPOOL and
ISO-NE (but not to exceed ten (10) days if there is no
explicit NEPOOL or ISO-NE period for curing the default), the
Buyer shall have the option to terminate or suspend all or a
portion of service under this Agreement upon no less than
twenty four (24) hours notice and obtain an alternative source
of supply of SOS Requirements Power from the open market for
the remaining Term. In such event, the Seller shall be liable
to the Buyer for the entire difference between the cost of
such alternative source of supply obtained in the open market
and the cost of purchasing SOS Requirements Power under this
Agreement, plus all other costs reasonably incurred by the
Buyer to replace the Seller. The Parties hereby stipulate that
purchases by the Buyer at the applicable ISO-NE spot market
prices will be deemed commercially reasonable open market
prices for this purpose. Nothing in this Section 7.2 shall be
deemed as a waiver of any other legal or equitable remedies
that the Buyer may have against the Seller for breach of this
Agreement.
7.3 In the event that the Buyer defaults on its material
obligations to the Seller or NEPOOL in connection with this
Agreement at any time during the Term, and the Buyer does not
cure such default within a time period allowed by NEPOOL and
ISO-NE (but not to exceed ten (10) days if there is no
explicit NEPOOL or ISO-NE period for curing the default), the
Seller shall have the option to terminate or suspend all or a
portion of service under this Agreement upon no less than
twenty four (24) hours notice and thereafter sell any of the
resources it has obtained in order to meet its obligations
under this Agreement in the open market. In such event, the
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Buyer shall be liable to the Seller for the entire difference
between the prices obtained by the Seller in the open market
and the price the Seller would have obtained for selling SOS
Requirements Power under this Agreement. The Parties hereby
stipulate that sales by the Seller at the applicable ISO-NE
spot market prices will be deemed commercially reasonable open
market prices for this purpose. Nothing in this Section 7.3
shall be deemed as a waiver of any other legal or equitable
remedies that the Seller may have against the Buyer for breach
of this Agreement.
7.4 Notwithstanding any other provision of this Agreement, neither
Party shall be liable to the other Party in the event that,
due to a cause beyond the reasonable control of, and without
the fault or negligence of the Party seeking to limit its
liability hereunder ("Force Majeure"), NEPOOL experiences
unplanned-for emergency system conditions, including but not
limited to a shortage of available electric generating
capacity or an insufficiency of transmission or distribution
facilities required for the delivery of SOS Requirements
Power, such that NEPOOL either must suspend the supply of one
or more of the products required to serve load in NEPOOL or
must curtail or interrupt all or a portion of the Standard
Offer Service Load.
7.5 For purposes of Section 7.4, "Force Majeure" shall include,
without limitation, sabotage, strikes, riots or civil
disturbance, acts of God, act of a public enemy, drought,
earthquake, flood, explosion, fire, lightning, landslide, or
any similar cataclysmic occurrence, or the appropriation or
diversion of electricity by sale or order of any governmental
authority having jurisdiction thereof. Under no circumstances
shall Force Majeure include an occurrence or event that merely
increases the costs of or causes an economic hardship to a
Party, or any occurrence or event that was caused by or
contributed to by the Party claiming Force Majeure.
7.6 Except as otherwise specifically provided for herein, neither
Party shall be liable to the other Party for any special,
indirect, incidental, consequential, or punitive damages of
any kind, including but not limited to loss of use, out of
pocket expenses and lost profits (past or future).
8. BUYER CREDIT/SECURITY ASSURANCES
8.1 NRG Energy, Inc. has provided the Buyer a certificate executed
by an officer of NRG Energy, Inc. certifying that NRG Energy,
Inc. has entered into a firm wholesale entitlements contract
("Entitlement Agreement") with the Seller for the full Term of
this Agreement, pursuant to which the Seller has acquired from
NRG Energy, Inc. firm, first-call entitlement rights to no
less than 1,600 MW of generating capacity located in the
NEPOOL control area that are owned or controlled by NRG
Energy, Inc. and has obtained, or will obtain, any regulatory
or other approvals required to put
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the Entitlement Agreement into effect as of the commencement
of the Term. Entitlements in generating units obtained by NRG
Energy, Inc. pursuant to the Transition Agreement shall be
considered generating capacity owned and controlled by the
Seller for purposes of the prior sentence. The Entitlement
Agreement shall provide the Seller with all of the rights to
capacity, energy and ancillary services available from the
generating units such that the Seller can satisfy its
obligation to supply SOS Requirements Power for the full Term
of this Agreement; provided, however, that the Seller may
terminate the Entitlement Agreement if, during the Term, the
Seller achieves an Unsecured Investment Grade Rating of "Baa3"
or better from Moody's Investors Service or "BBB-" or better
from Standard & Poors Corporation, or an equivalent credit
rating by another nationally recognized rating service
reasonably acceptable to the Buyer; and provided further, if
the Seller is unable to maintain such Investment Grade Rating
during the Term, it shall either promptly re-instate the
Entitlement Agreement or promptly deliver to the Buyer a
written parent guarantee, in a form acceptable to the Buyer,
by NRG Energy, Inc. of the Seller's performance under this
Agreement for the remaining Term hereof.
8.2 The Parties hereby acknowledge that NRG Energy, Inc. or
another affiliate of Seller with an Unsecured Investment Grade
Rating of "Baa3" or better from Moody's Investors Service or
"BBB-" or better from Standard & Poors Corporation, or an
equivalent credit rating by another nationally recognized
rating service reasonably acceptable to the Buyer, has
provided the Buyer a corporate guarantee in the amount of $37
million, which is equal to ten (10) percent of the dollar
value for the first year of the awarded bid. The Seller shall
cause NRG Energy, Inc. or another qualifying affiliate of
Seller (as applicable) to keep such corporate guarantee in
place for the full Term.
8.3 By no later than the date of commencement of the Term, the
Buyer shall provide the Seller a performance or surety bond or
other similar financial instrument in a form and from an
issuer reasonably acceptable to the Seller in the amount of
$37 million, unless the Buyer shall have obtained an Unsecured
Investment Grade Rating of "Baa3" or better from Moody's
Investors Service or "BBB-" or better from Standard & Poors
Corporation, or an equivalent credit rating by another
nationally recognized rating service reasonably acceptable to
the Buyer, by such service commencement date. The Buyer shall
be entitled to terminate such surety bond or other similar
financial instrument immediately upon obtaining a Unsecured
Investment Grade Rating of "Baa3" or better from Moody's
Investors Service or "BBB-" or better from Standard & Poors
Corporation, or an equivalent credit rating by another
nationally recognized rating service reasonably acceptable to
the Buyer. If the Buyer is unable to maintain such Unsecured
Investment Grade Rating during the Term, it
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shall promptly re-instate such performance or surety bond or
other financial instrument.
9. CONDITIONS
9.1 Conditions to Obligation of the Seller. The obligations of the
Seller under this Agreement are subject to the fulfillment and
satisfaction, on or prior to the Effective Date as defined in
Section 2.1, of each of the following conditions, any one or
more of which may be waived only in writing, in whole or in
part, by the Seller:
(a) Representations, Warranties and Covenants True at the
Effective Date. (i) All representations and warranties of
Buyer contained in this Agreement shall be true and
correct in all material respects as of the date when made
and at and as of the Effective Date as though such
representations and warranties had been made or given on
such date (except to the extent such representations and
warranties specifically pertain to an earlier date),
except (x) for changes contemplated by this Agreement and
(y) where the failure to be true and correct will not
have a Material Adverse Effect on the business, property,
financial condition, results of operations or prospects
of Buyer, or on the Seller's rights under this Agreement;
(ii) Buyer shall have performed and complied with, in all
material respects, its obligations that are to be
performed or complied with by it prior to or on the
Effective Date; and
(b) No Material Adverse Effect. No Material Adverse Effect
shall exist.
9.2 Conditions to Obligation of Buyer. The obligations of Buyer
under this Agreement are subject to the fulfillment and
satisfaction, on or prior to the Effective Date as defined in
Section 2.1, of each of the following conditions, any one or
more of which may only be waived in writing, in whole or in
part, by Buyer:
(a) Representations, Warranties and Covenants True at the
Effective Date. (i) All representations and warranties of
the Seller contained in this Agreement shall be true and
correct in all material respects when made and at and as
of the Effective Date as though such representations and
warranties had been made or given on such date (except to
the extent such representations and warranties
specifically pertain to an earlier date), except (x) for
changes contemplated by this Agreement and (y) where the
failure to be true and correct will not have a Material
Adverse Effect on the business, property, financial
condition, results of operations or prospects of the
Seller or Buyer's rights under this Agreement; (ii) the
Seller shall have performed and
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complied with, in all material respects, its obligations
that are to be performed or complied with by prior to or
on the Effective Date; and
(b) Absence of Material Adverse Effect. No Material Adverse
Effect shall exist.
9.3 Special Condition Regarding Retail Rates. The DPUC has issued
an order stating that it will set the General Services
Component ("GSC") rates for Retail Customers taking Standard
Offer Service after the negotiation of this Agreement, and
that such GSC rates will be established by retail rate class.
The Parties have agreed that the level of the GSC rates and
distribution to each retail rate class could affect the
Seller's expectations in submitting the prices set forth in
Section 4.1 in response to the RFP. Accordingly, the Parties
agree that, if the DPUC establishes GSC rates at levels which
include an adjustment above the weighted average Standard
Offer price that are in excess of the maximum rate adjustments
set forth in the table below, the Seller shall have the right
to seek to renegotiate the prices set forth in Section 4.1,
solely as necessary to reflect the GSC rate adjustment
exceeding the amounts in the table set forth below. The
Parties agree that these adjustments in the table below
reflect both a retail adder and a wholesale rate specific
adjustment. The Parties further specifically agree that the
Seller's right to seek a renegotiation of the prices set forth
in Section 4.1 shall apply solely in the circumstance where
the DPUC approves GSC rates for any rate class that are in
excess of the weighted average Standard Offer price, plus the
maximum rate adjustments set forth in the table below, and
that this Section 9.3 creates no other right or remedy on
behalf of the Seller. In retail restructuring proceedings
before the DPUC, CL&P (1) shall not advocate the adoption of
GSC rates that include adders above the weighted average
Standard Offer price that are not cost-based, and (2)
consistent with (1) above, shall request and advocate that the
DPUC adopt retail GSC rates that include adders that are below
those set forth in this Section 9.3.
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Table:
- ------------------------- ----------------------
CL&P's Rate Proposed GSC
Schedule No. Maximum Rate
Adjustment
- ------------------------- ----------------------
1
- ------------------------- ----------------------
5
- ------------------------- ----------------------
7
- ------------------------- ----------------------
18
- ------------------------- ----------------------
27
- ------------------------- ----------------------
29
- ------------------------- ----------------------
30
- ------------------------- ----------------------
35
- ------------------------- ----------------------
40
- ------------------------- ----------------------
41
- ------------------------- ----------------------
55
- ------------------------- ----------------------
56
- ------------------------- ----------------------
57
- ------------------------- ----------------------
58
- ------------------------- ----------------------
115
- ------------------------- ----------------------
116
- ------------------------- ----------------------
117
- ------------------------- ----------------------
985
- ------------------------- ----------------------
119
- ------------------------- ----------------------
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10. REPRESENTATIONS AND WARRANTIES
10.1 Each Party hereby represents and warrants to the other that:
(a) It is duly organized, validly existing and in good
standing under the laws of its jurisdiction of
organization and is duly qualified to do business in all
jurisdictions where such qualification is required.
(b) It has full power and authority to enter this Agreement
and perform its obligations hereunder. The execution,
delivery and performance of this Agreement have been duly
authorized by all necessary corporate action and do not
and will not contravene its organizational documents or
conflict with, result in a breach of, or entitle any
Party (with due notice or lapse of time or both) to
terminate, accelerate or declare a default under, any
agreement or instrument to which it is a party or by
which it is bound. The execution, delivery and
performance by it of this Agreement will not result in
any violation by it of any law, rule or regulation
applicable to it. It is not a party to, nor subject to or
bound by, any judgment, injunction or decree of any court
or other governmental entity which may restrict or
interfere with the performance of this Agreement by it.
This Agreement is its valid and binding obligation,
enforceable against it in accordance with its terms,
except as (i) such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to
creditors' rights generally and (ii) the remedy of
specific performance and injunctive relief may be subject
to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought.
(c) Except as otherwise specifically provided in this
Agreement, no consent, waiver, order, approval,
authorization or order of, or registration, qualification
or filing with, any court or other governmental agency or
authority is required for the execution, delivery and
performance by such Party of this Agreement and the
consummation by such Party of the transactions
contemplated hereby and no consent or waiver of any party
to any contract to which such Party is a party or by
which it is bound is required for the execution, delivery
and performance by such Party of this Agreement.
(d) There is no action, suit, grievance, arbitration or
proceeding pending or, to the knowledge of such Party,
threatened against or affecting such Party at law or in
equity, before any federal, state, municipal or other
governmental court, department, commission, board,
arbitrator, bureau, agency or instrumentality that
prohibits or impairs its ability to execute and deliver
this Agreement. Such Party has not received written
notice of any such pending or threatened investigation,
inquiry or review by any governmental entity.
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10.2 The Buyer hereby represents that it has not asserted and will
not take during the term any position before the DPUC or FERC
that is inconsistent with the rights and obligations of the
Parties under this Agreement, provided that the foregoing will
not prevent the Buyer from asserting or taking any position
before such agencies which it reasonably believes is necesarry
for it to meet applicable legal requirements.
11. ASSIGNMENT
11.1 Neither Party shall assign, pledge or transfer this Agreement
without the prior written consent of the other Party, which
consent shall not be unreasonably withheld. When assignable,
this Agreement shall be binding upon, shall inure to the
benefit of, and may be performed by, the successors and
assignees of the Parties, except that no assignment, pledge or
other transfer of this Agreement by either Party shall operate
to release the assignor, pledgor, or transferor from any of
its obligations under this Agreement unless the other Party
(or its successors or assigns) consents in writing to the
assignment, pledge or other transfer and expressly releases
the assignor, pledgor, or transferor from its obligations
hereunder. Notwithstanding the foregoing, either Party may
transfer or assign its interest hereunder to an affiliate, or
to a successor in interest of such Party by virtue of a
merger, acquisition or other similar corporate transaction
involving all or substantially all of the assets of the
assigning Party, without obtaining the consent of the other
Party, provided that the assignee has a credit status at the
time of such transfer or assignment which, in the
non-assigning Party's reasonable opinion, is at least as sound
as that of the assignor. Nothing in the foregoing shall be
construed as limiting the Seller's right to assign or
otherwise transfer a security interest in the revenues
generated under this Agreement to a third party, and Buyer
expressly consents to such assignment for security interest
purposes, provided that such assignment or transfer shall not
limit in any way the Seller's obligations to the Buyer
hereunder.
12. ACCOUNTS AND RECORDS
12.1 The Seller and Buyer each shall keep complete and accurate
accounts and records with respect to its performance under
this Agreement and shall maintain such data for a period of at
least one (1) year after final billing for audit by the other
Party; provided, however, that in the event of any billing
dispute or pending accounting, all such accounts and records
pertaining to any bill or charge in dispute or pending
accounting shall be maintained until such later time as the
billing dispute is resolved or the accounting is completed. If
an accounting or billing dispute establishes
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that any bill submitted to and paid by Buyer was for an amount
greater than properly chargeable under this Agreement, Seller
shall refund to Buyer the excess amount collected together
with interest calculated in accordance with the FERC's
regulations governing interest on refunds. If such accounting
or billing dispute establishes that any bill submitted to and
paid by Buyer was for an amount less than properly chargeable
under this Agreement, Buyer shall make such additional payment
to bring its account into balance, together with interest
calculated in accordance with the FERC's regulations governing
interest on refunds. The Parties agree to individually and
jointly request from NEPOOL or the ISO, or other appropriate
source, any data or information which either Party believes is
reasonably necessary for purposes of a requested accounting or
resolution of a billing dispute. Each Party shall have the
right, during normal business hours and at its own expense, to
examine, inspect and make copies of all such accounts and
records insofar as may be necessary for the purpose of
ascertaining the reasonableness and accuracy of all relevant
data, estimates or statement of charges submitted hereunder.
The records supplied by the Buyer to the Seller for auditing
purposes hereunder shall include the Buyer's hourly
calculation of its Standard Offer Service Load.
13. INDEMNIFICATION
13.1 Indemnification by Buyer. Buyer shall indemnify, defend and
hold harmless the Seller and the Seller's board members,
officers, trustees, directors, agents, employees and
affiliates from and against any and all claims, demands,
liabilities (including reasonable attorney's fees), and
judgments, fines, settlements and other amounts ("Damages")
arising from any and all civil, criminal, administrative or
investigative proceedings ("Claims") relating to or arising
out of:
(a) any failure of Buyer to observe or perform any material
term or provision of this Agreement;
(b) any failure of any representation or warranty made by
Buyer herein to be true in any material respect;
(c) any Claim of any third party to the extent arising from
the acts or omissions of Buyer or any of its agents or
employees except to the extent such acts or omissions are
caused by the Seller or its affiliates; and
(d) any bodily injury, death or damage to person or property
caused by the Buyer and its affiliates and their
respective board members, officers, managers, employees
or agents or caused by their facilities,
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in each case in connection with or resulting from Buyer's
performance or non-performance of this Agreement except
to the extent caused by an act of negligence or willful
misconduct of the Seller.
13.2 Indemnification by Seller. Seller shall indemnify, defend and
hold harmless the Buyer and the Buyer's board members,
officers, trustees, directors, agents, employees and
affiliates from and against any and all claims, demands,
liabilities (including reasonable attorney's fees), and
judgments, fines, settlements and other amounts ("Damages")
arising from any and all civil, criminal, administrative or
investigative proceedings ("Claims") relating to or arising
out of:
(a) any failure of Seller to observe or perform any material
term or provision of this Agreement;
(b) any failure of any representation or warranty made by
Seller herein to be true in any material respect;
(c) any Claim of any third party to the extent arising from
the acts or omissions of Seller or any of its agents or
employees except to the extent such acts or omissions are
caused by the Buyer or its affiliates; and
(d) any bodily injury, death or damage to person or property
caused by the Seller and its affiliates and their
respective board members, officers, managers, employees or
agents or caused by their facilities, in each case in
connection with or resulting from Seller's performance or
non-performance of this Agreement except to the extent
caused by an act of negligence or willful misconduct of
the Buyer.
14. NOTICES
14.1 Any notice, demand, or request permitted or required under
this Agreement shall be delivered in person or mailed by
certified mail, postage prepaid, return receipt requested, or
otherwise confirm receipt to a Party at the applicable address
set forth below.
To Buyer:
Director, Regulatory Policy and Planning
Northeast Utilities Service Company
P.O. Box 270
Hartford, CT 06141-0270
To Seller:
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Executive Director, Power Markets
NRG Power Marketing Inc.
1221 Nicollet Mall, Suite 700
Minneapolis, MN 55403
Such addresses may be changed from time to time by written notice by
either Party to the other Party without a need for an amendment to this
Agreement.
15. INTERPRETATION
15.1 The interpretation and performance of this Agreement shall be
according to and controlled by the Federal Power Act and
regulations and orders of the FERC thereunder and, to the
extent not controlled thereby, by the laws of the State of
Connecticut.
16. RESOLUTION OF DISPUTES
16.1 Any dispute between the Parties involving service under this
Agreement shall be referred to representatives of the Buyer
and Seller designated by the Parties for resolution on an
informal basis as promptly as practicable. In the event the
designated representatives are unable to resolve the dispute
within thirty (30) days, or such other period as the Parties
may jointly agree upon, such dispute may, by mutual agreement
of the Parties, be submitted to arbitration and resolved in
accordance with the arbitration procedure set forth in the
NEPOOL Transmission Tariff. If they do not agree to
arbitration, each Party shall be free to pursue any legal and
equitable remedies to which it may be entitled under this
Agreement and the applicable law before a court or government
agency with jurisdiction over the dispute.
17. MISCELLANEOUS
17.1 Each Party shall prepare, execute, and deliver to the other
Party any documents reasonably required to implement any
provision hereof.
17.2 Any number of counterparts of this Agreement may be executed
and each shall have the same force and effect as the original.
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17.3 Failure of either Party to enforce any provision of this
Agreement or to require performance by the other Party of any
of the provisions hereof shall not be construed as a waiver of
such provisions or affect the validity of this Agreement, any
part hereof, or the right of either Party to thereafter
enforce each and every provision.
17.4 This Agreement is made subject to all lawful orders of those
state or federal regulatory bodies having jurisdiction hereof.
17.5 Nothing in this Agreement shall be construed as creating any
relationship between the Parties other than that of
independent contractor for the sale and purchase of
electricity.
17.6 The captions to sections throughout this Agreement are
intended solely to facilitate reading and reference to all
sections and provisions of this Agreement. Such captions shall
not affect the meaning or interpretation of this Agreement.
17.7 The invalidity or unenforceability of any provision of this
Agreement shall not affect the other provisions hereof. If any
provision of this Agreement is held to be invalid, such
provision shall not be severed from this Agreement; instead,
the scope of the rights and duties created thereby shall be
reduced by the smallest extent necessary to conform such
provision to the applicable law, preserving to the greatest
extent the intent of the Parties to create such rights and
duties as set out herein. If necessary to preserve the intent
of the Parties hereto, the Parties shall negotiate in good
faith to amend this Agreement, adopting a substitute provision
for the one deemed invalid or unenforceable that is legally
binding and enforceable.
17.8 The Buyer shall use reasonable efforts to supply the Seller
with any orders of the DPUC that may affect the Seller's
rights and obligations under this Agreement. Such orders shall
be provided to the individual designated for receipt of
notices pursuant to Section 14.1.
18. AMENDMENT
18.1 This Agreement may be amended only by a written agreement signed
by the Parties.
19. COMPLETE AND FULL AGREEMENT
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19.1 This Agreement constitutes the entire agreement between the
Parties and supersedes all previous offers, negotiations,
discussions, communications and correspondence.
20. NOTICE OF TERMINATION
20.1 Upon expiration of the Term of this Agreement, Buyer will not
oppose and, if Seller requests, Buyer will support, any notice
of termination which Seller may be required to file under FERC
regulations.
21. EARLY TERMINATION
21.1 In the event that the Transition Agreement terminates pursuant
to and in accordance with Section 2.2 thereof prior to the
expiration of the Term of this Agreement, this Agreement shall
likewise terminate as of the date of termination of the
Transition Agreement in accordance with Section 2.2 thereof.
IN WITNESS WHEREOF, the undersigned Parties have caused this Agreement to be
executed in their names by their respective duly authorized officials, as of the
29th day of October, 1999.
The Connecticut Light and Power Company
By: /s/ James R. Shuckerow, Jr.
------------------------------------------
James R. Shuckerow, Jr.
Director, Wholesale Power Contracts
NRG Power Marketing Inc.
By: /s/ James J. Bender
------------------------------------------
James J. Bender
Vice President
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APPENDIX A
CALCULATION OF THE STANDARD OFFER SUPPLIER'S
BILLING DETERMINANTS
The Contract Load Quantity will be determined in accordance with the
methodology accepted by the DPUC for the calculation of the load
responsibilities of competitive retail service suppliers in the competitive
retail markets in Connecticut and the settlement rules adopted by NEPOOL and the
NEPOOL ISO. The methodology set forth below is based on CL&P's proposed
methodology to the DPUC for calculating such retail load responsibilities and
current NEPOOL settlement rules, and shall apply unless such methodology is
changed pursuant to lawful action of NEPOOL or the DPUC. In the event that the
DPUC or NEPOOL implement any such changes, the Buyer shall promptly notify the
Seller in writing of such changes.
1. Determination of the System Retail Load.
On an hourly basis, the Buyer will calculate the aggregate load of its
Retail Customers, ( the "System Retail Load"). The System Retail Load will be
computed for each hour based on the total metered output of all generation
connected to the Buyer's system below the tie meters at which NEPOOL measures
net interchange between the Buyer's system and NEPOOL,and adding to that figure
the net imports into the Buyer's system (or subtracting net exports from the
system) as measured by the tie meters at or below the NEPOOL PTF, less
non-retail loads (e.g. wholesale load served to municipalities).
2. Determination of retail customer Hourly Loads.
For each hour, the Buyer will calculate the actual or estimated loads
of each of its Retail Customers using one of the following two methods:
a) In circumstances where the Customer has an interval
recording meter (capable of recording pulses in 15 minute, or other
intervals), the retail customer's initial hourly load is determined by
these interval pulses translated or
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aggregated into hourly consumption quantities. The Buyer will use the
actual recorded meter readings, increased to account for losses on the
Buyer's system between the Delivery Point and end-use meters in
accordance with a study entitled, "Determination of Loss Factors for
the Northeast Utilities System" conducted by Northeast Utilities'
Transmission Planning Department dated October 1, 1989, to determine
the hourly loads of the Retail Customers.
b) In circumstances where Retail Customers do not have
interval meters capable of recording hourly consumption quantities, the
Buyer will determine the hourly loads of the Retail Customers using the
load estimation technique filed with the DPUC for purposes of
calculating retail load responsibilities of competitive suppliers under
the Connecticut retail choice program. The load estimation technique
will be based on load profile statistics developed for different retail
customer classes and segments, and for each calendar month, days and
time periods, based on statistical sampling of consumption patterns of
Retail Customers with interval recording meters. The average load
profiles so developed will be scaled for individual Retail Customers
using a usage factor that is calculated based on the relationship
between the individual Retail Customer's usage over the prior billing
period and the average retail class segment usage estimated over the
same time period, and increased to account for losses on the Buyer's
system between the Delivery Point and end-use meters in accordance with
a study entitled, "Determination of Loss Factors for the Northeast
Utilities System" conducted by Northeast Utilities' Transmission
Planning Department dated October 1, 1989.
3. Determination of Competitive Supplier Hourly Loads.
The hourly loads of each Competitive Supplier serving retail load on
the Buyer's system will be estimated using the following two step process:
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a) Each retail customer will be assigned a Competitive
Supplier Code based on the identity of its Competitive Supplier. Those
Customers that have not designated a Competitive Supplier will be
assigned the Standard Offer Service Supplier Code. The retail customer
hourly loads, calculated in accordance with section 2(a) and (b) above,
associated with the Retail Customers that have been assigned the same
Competitive (or Standard Offer Service) Supplier Code, will be summed
for each hour.
b) Determination of Residual. The difference between the
System Retail Load (as determined in section 1 above) and the sum of
the load responsibilities of all Competitive Suppliers (including
Standard Offer Service load), determined in accordance with section
3(a), will constitute the "Residual". The Residual will be allocated to
each Competitive Supplier (and to the Standard Offer Service load) in
proportion to the ratio of the estimated part of the Supplier's
assigned retail customer load (as calculated in section 2(b) to the sum
of the estimated part of the retail customer loads of all Competitive
Suppliers, as calculated in section 2(b), including the Standard Offer
Service load.
4. Determination of SOS Total Hourly Loads.
The Standard Offer Service hourly load will be determined in accordance
with section 3 based on the calculated or estimated hourly loads, including
Residual allocations to estimated hourly loads, for all Retail Customers
assigned the Standard Offer Service Supplier Code.
5. Allocation of SOS Supplier Hourly Loads.
The total Standard Offer Service hourly load will be allocated among
each of the Sellers of Standard Offer Service based on the percentage of the
total Standard Offer Service Load assigned to that Seller in Section 3.5 of that
Seller's Standard Offer Service Agreement with the Buyer.
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6. Reporting of SOS Supplier Hourly Loads to the ISO.
a) In accordance with the rules of NEPOOL, the Buyer will report to the
ISO the hourly loads, determined in accordance with section 5 of this Appendix
A, for each Seller of Standard Offer Service (or the NEPOOL participant
responsible for that Seller's load under NEPOOL rules), within 37 business hours
after the close of each day. Each Seller of Standard Offer Service, or the
NEPOOL participant designated by such Seller to assume the Seller's load
responsibility in NEPOOL, will have sole responsibility for all charges assessed
by the ISO based on the hourly loads reported by the Buyer.
b) The Contract Load Quantity for each Seller of Standard Offer Service
will be equal to the aggregate of the Standard Offer Service hourly loads of
such Seller, summed over the calendar month, as reported to NEPOOL in accordance
with section 6(a) of Appendix A.
7. Determination of SOS Supplier Billing Amount.
The SOS Supplier Billing Amount is equal to the Contract Load Quantity
multiplied by a delivery efficiency factor of 0.9238. This amount will be
submitted to Seller for purposes of billing hereunder. The delivery
efficiency factor set forth above shall not be subject to change during the
Term.
8. Determination of adjusted SOS Supplier Billing Amount.
In accordance with the requirements of NEPOOL Market Rules & Procedures
No. 18, the Buyer will submit to the ISO, within 90 days after the end of each
month, revised monthly energy quantities for each NEPOOL participant for such
month. The adjusted Contract Load Quantity for each Seller of Standard Offer
Service will be based on a 90 day true-up for that month submitted to NEPOOL by
the Buyer. The adjusted SOS Supplier Billing Amount will be the adjusted
Contract Load Quantity multiplied by a delivery efficiency factor of 0.9238.
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