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EXHIBIT 10.12
AUTHENTICATED-PROPRIETARY Contract No. 00PB-12197
BLOCK POWER SALES AGREEMENT
EXECUTED BY THE
BONNEVILLE POWER ADMINISTRATION
AND
GOLDEN NORTHWEST ALUMINUM, INC.
TABLE OF CONTENTS
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SECTION PAGE
1. TERM ............................................................. 2
2. DEFINITIONS ...................................................... 2
3. APPLICABLE RATES ................................................. 3
4. INDUSTRIAL FIRM POWER PRODUCT .................................... 4
5. CURTAILMENT AND LOAD MANAGEMENT .................................. 4
6. TAKE-OR-PAY MITIGATION/RELIEF FROM TAKE-OR-PAY ................... 4
7. SCHEDULING ....................................................... 6
8. DELIVERY ......................................................... 6
9. MEASUREMENT ...................................................... 7
10. BILLING AND PAYMENT .............................................. 7
11. NOTICES .......................................................... 9
12. COST RECOVERY .................................................... 9
13. UNCONTROLLABLE FORCES ............................................ 10
14. GOVERNING LAW AND DISPUTE RESOLUTION ............................. 11
15. STATUTORY PROVISIONS ............................................. 12
16. STANDARD PROVISIONS .............................................. 13
17. TERMINATION ...................................................... 15
18. GOOD CORPORATE CITIZENSHIP CLAUSE ................................ 16
19. SIGNATURES ....................................................... 17
EXHIBIT A RATE COMMITMENTS
EXHIBIT B BILLING
EXHIBIT C POWER RATE
EXHIBIT D ADDITIONAL PRODUCTS, SERVICES, AND SPECIAL PROVISIONS
EXHIBIT E SCHEDULING
This BLOCK POWER SALES AGREEMENT (Agreement) is executed by the UNITED
STATES OF AMERICA, Department of Energy, acting by and through the BONNEVILLE
POWER ADMINISTRATION (BPA), and GOLDEN NORTHWEST ALUMINUM, INC. (Golden
Northwest). Golden Northwest is a Corporation organized under the laws of the
State of Oregon.
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RECITALS
This Agreement will replace Contract No. 95MS-94854 and Contract No. 95MS-94862.
BPA has administratively divided its organization into two business lines in
order to functionally separate the administration and decisionmaking activities
of BPA's power business from the administrative and decisionmaking activities of
its transmission business. References in this Agreement to the Power Business
Line (PBL) are solely for the purpose of establishing which BPA business line is
responsible for the administration of this Agreement.
BPA and Golden Northwest agree:
1. TERM
This Agreement takes effect on the date signed by the Parties (Execution
Date). Performance by the Parties, (except for the preparatory actions
for performance) shall commence on October 1, 2001, and shall continue
through September 30, 2006 (Expiration Date).
2. DEFINITIONS
Capitalized terms in this Agreement shall have the meanings defined
below, in the exhibits or in context. All other capitalized terms and
acronyms are defined in BPA's applicable Wholesale Power Rate
Schedule(s), including the General Rate Schedule Provisions (GRSPs).
(a) "Amounts Taken" means an amount deemed equal to the amount of
power scheduled by Golden Northwest under section 7 of this
Agreement or an amount of power as measured at Points of
Measurement, as appropriate.
(b) "Contract Year" means the period that begins each October 1 and
which ends the following September 30. For instance Contract
Year 2002 begins October 1, 2001, and continues through
September 30, 2002.
(c) "Contracted Power" means Firm Power and Surplus Firm Power
provided under this Agreement.
(d) "Diurnal" means the division of hours of the day between Heavy
Load Hours (HLH) and Light Load Hours (LLH).
(e) "Firm Power" means electric power that PBL will make
continuously available to Golden Northwest under this Agreement.
(f) "Northwest Power Act" means the Pacific Northwest Electric Power
Planning and Conservation Act of 1980, P.L. 96-501.
(g) "Party" or "Parties" means PBL and/or Golden Northwest.
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(h) "Planned Maintenance Outage" means a reduction in Total Plant
Load due to periodic or routine plant maintenance that is
typical for Golden Northwest's industry. Planned Maintenance
Outages shall not exceed 10 days per year, unless otherwise
agreed to by BPA.
(i) "Points of Measurement" means the interconnection points between
BPA, Golden Northwest and other control areas, as applicable.
Electric power amounts are established at these points based on
metered amounts or scheduled amounts, as appropriate.
(j) "Point of Receipt" means the points of interconnection on the
transmission provider's transmission system where Contracted
Power will be made available to Golden Northwest's transmission
provider by PBL.
(k) "Power Business Line" or "PBL" means that portion of the BPA
organization or its successor that is responsible for the
management and sale of BPA's Federal power.
(l) "Region" means the definition established for "Region" in the
Northwest Power Act.
(m) "Total Plant Load" means all electric power consumption
including electric system losses, at Golden Northwest's
production facilities as measured at Points of Measurement. No
distinction is made between load that is served with Contracted
Power and load that is served with electric power from other
sources.
(n) "Transmission Business Line" or "TBL" means that portion of the
BPA organization or its successor that is responsible for the
management and sale of transmission service on the Federal
Columbia River Transmission System (FCRTS).
3. APPLICABLE RATES
(a) Purchases under this Agreement may be subject to more than one
rate schedule. The Industrial Firm Power (IP-02) and the Firm
Power Products and Services (FPS) rate schedules, including the
GRSPs, apply to power purchases under this Agreement. Purchases
under each rate schedule are established as follows:
(1) IP-02 Rate. Section 4 of the body of this Agreement,
Exhibit B (Billing), and Exhibit C, Power Rate identify
Contracted Power amounts, rates and billing entitlements
subject to the IP-02 Rate schedule.
(2) FPS. Except when otherwise specified in this Agreement
Exhibit D (Additional Products, Services, and Special
Provisions) identifies amounts, rates and billing
entitlements subject to the FPS rate schedule.
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4. INDUSTRIAL FIRM POWER PRODUCT
Golden Northwest shall purchase 236 megawatts (MW) each hour during the
term of this Agreement.
5. CURTAILMENT AND LOAD MANAGEMENT
(a) CURTAILMENT
If Golden Northwest curtails Total Plant Load in whole or in
part, then Golden Northwest may request take-or-pay mitigation
for purchases under section 4 pursuant to section 6(a) below.
(b) SHORT-TERM LOAD MANAGEMENT INTERRUPTIONS UNDER SEPARATE
AGREEMENTS Nothing in this Agreement shall preclude BPA and
Golden Northwest from entering into separate agreements that
provide for short-term load management interruption(s) of BPA
deliveries to Golden Northwest.
6. TAKE-OR-PAY MITIGATION/RELIEF FROM TAKE-OR-PAY
(a) TAKE-OR-PAY MITIGATION FOR CURTAILMENTS
If Golden Northwest chooses to curtail its purchase obligation
pursuant to section 5(a) above, then the following terms and
conditions shall apply:
(1) NOTICE OF CURTAILMENT
Golden Northwest shall endeavor to provide notice to BPA
at least seven (7) business days in advance of a
curtailment; PROVIDED, HOWEVER, that such notice shall
in no event be less than three (3) business days prior
to the beginning of a curtailment. Such notice shall
specify the amount of power to be curtailed (Purchase
Deficiency) and the duration of the curtailment. The
election to curtail such power, and the amount and
duration of such curtailment, may not be changed without
BPA's consent.
(2) LIMITATION ON DAMAGES
Golden Northwest shall pay BPA damages for any Purchase
Deficiency equal to the amount by which the reasonable
market value of such Purchase Deficiency is less than
the price of the applicable IP-02 Rate. Following are
two options for the calculation of such damages, if any.
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(A) Except for circumstances established in section
6(a)(2)(B) below, damages shall be calculated as
follows: No later than sixty (60) business days
after the end of each Contract Year, BPA shall
calculate the reasonable market value of any
Purchase Deficiency due to a curtailment, taking
into account the differing market values for
each day in any month in which there was a
Purchase Deficiency during each such Contract
Year. Golden Northwest shall pay BPA damages
equal to the amount by which the sum of the
product of the monthly purchase deficiencies and
the applicable IP-02 Rate exceeds the sum of the
product of the monthly purchase deficiencies,
and the reasonable market value in each month.
BPA is not obligated to pay Golden Northwest the
difference when the reasonable market value
exceeds the applicable IP-02 Rate schedule.
(B) BPA shall obtain a transactable quote for such
power from a third-party. If Golden Northwest
notifies BPA that such quote is unacceptable
within 24 hours after BPA provides Golden
Northwest such quote, then damages shall be
calculated according to 6(a)(2)(A) above.
Otherwise, such quote shall be deemed equal to
the reasonable market value of such power for
the purpose of calculating damages under this
section 6(a)(2)(B). Further, BPA shall not be
obligated to resell the Purchase Deficiency to
the third-party that provided the quote and may
retain the power or dispose of the power as it
chooses. Golden Northwest shall pay BPA damages
equal to the amount by which the sum of the
product of the amount of the monthly Purchase
Deficiency subject to this election and the
applicable IP-02 Rate exceeds the reasonable
market value established by the quote. BPA is
not obligated to pay Golden Northwest the
difference when the reasonable market value
exceeds the applicable IP-02 Rate schedule.
(b) PLANNED MAINTENANCE OUTAGES
No less than seven days prior to the beginning of a Planned
Maintenance Outage Golden Northwest shall provide BPA with
written notice that specifies the duration of the Planned
Maintenance Outage and the amount of purchase obligation that is
to be reduced. If Golden Northwest provides BPA with written
notice, Golden Northwest may reschedule amounts of Contracted
Power that are not received due to a Planned Maintenance Outage.
Such amounts may only be rescheduled during months when the
IP-02 rate is less than or equal to the rate in effect when the
Planned Maintenance Outage occurred. All other provisions
relating to delivery shall be as mutually agreed to by the
Parties.
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7. SCHEDULING
All Contracted Power transactions under this Agreement shall be
scheduled and implemented consistent with Exhibit E, Scheduling. The
procedures for scheduling described in Exhibit E, Scheduling, are the
standard utility procedures followed by BPA for power transactions
between PBL and other utilities or entities in the Region that require
scheduling.
8. DELIVERY
(a) TRANSMISSION SERVICE FOR CONTRACTED POWER
This Agreement does not provide transmission services for, or
include the delivery of, Contracted Power to Golden Northwest,
unless otherwise provided. Golden Northwest shall be responsible
for executing one or more wheeling agreements with a
transmission supplier for the delivery of Contracted Power
(Wheeling Agreement). The Parties agree to take such actions as
may be necessary to facilitate the delivery of Contracted Power
to Golden Northwest consistent with the terms, notice, and the
time limits contained in the Wheeling Agreement.
(b) LIABILITY FOR DELIVERY
Golden Northwest waives any claims against PBL arising under
this Agreement for nondelivery of power to any points beyond the
applicable Points of Receipt. PBL shall not be liable for any
third-party claims related to the delivery of power after it
leaves the Points of Receipt. In no event will either Party be
liable under this Agreement to the other Party for damage that
results from any sudden, unexpected, changed, or abnormal
electrical condition occurring in or on any electric system,
regardless of ownership. These limitations on liability apply
regardless of whether or not this Agreement provides for
transfer service.
(c) POINTS OF RECEIPT
PBL shall make Contracted Power available to Golden Northwest
under this Agreement at Points of Receipt solely for the purpose
of scheduling transmission to points of delivery for service to
Golden Northwest's Total Plant Load, unless otherwise provided.
Golden Northwest shall schedule, if scheduling is necessary,
such Contracted Power solely for use by its Total Plant Load.
PBL, for purposes of scheduling transmission for delivery under
this Agreement, specified Points of Receipt in a written notice
to Golden Northwest prior to August 1, 2000.
If required by the Wheeling Agreement when PBL
designates such Points of Receipt, PBL will provide capacity
amounts for transmission under the Wheeling Agreement associated
with the initial Points of Receipt that can be accepted as firm
Points of Receipt under Golden Northwest's Wheeling Agreement
(except in the event that all Points of Receipt on the Federal
Columbia River Power System (FCRPS) would be considered
nonfirm). The sum of capacity amounts requested by PBL shall not
exceed the amount of Contracted Power specified in section 4 of
this Agreement. Such Points of
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Receipt and their capacity amounts may only be changed through
mutual agreement. However, at any time PBL may request the use
of a nonfirm Point of Receipt to provide Contracted Power to
Golden Northwest, but not withstanding section 8(b) above, PBL
shall reimburse Golden Northwest for any additional costs or
production losses incurred by Golden Northwest due to its
compliance with such request.
(d) TRANSMISSION LOSSES
PBL shall provide Golden Northwest the losses between the Points
of Receipt and Golden Northwest's distribution facilities for
Contracted Power, at no additional charge. Losses will be
provided at Points of Receipt as established under section 8(c),
and under the terms and conditions as defined in the
transmission provider's tariff.
9. MEASUREMENT
(a) Amounts Taken are deemed equal to the amount scheduled by Golden
Northwest under section 7 of this Agreement or an amount of
power as measured at Points of Measurement, as appropriate.
(b) Golden Northwest shall provide reasonable notice to PBL prior to
changing control areas.
10. BILLING AND PAYMENT
(a) BILLING
PBL shall bill Golden Northwest monthly, consistent with
applicable BPA rates, including the GRSPs and the provisions of
this Agreement for the Amounts Taken, payments pursuant to
section 5, and other services provided to Golden Northwest in
the preceding month or months under this Agreement. PBL may send
Golden Northwest an estimated bill followed by a final bill. PBL
shall send all bills on the bill's issue date either
electronically or by mail, at Golden Northwest's option. If
electronic transmittal of the entire bill is not practical, PBL
shall transmit a summary electronically, and send the entire
bill by mail.
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(b) PAYMENT
Payment of all bills, whether estimated or final, must be
received by the 20th day after the issue date of the bill (Due
Date). If the 20th day is a Saturday, Sunday, or Federal
holiday, the Due Date is the next business day. If payment has
been made on an estimated bill before receipt of a final bill
for the same month, Golden Northwest shall pay only the amount
by which the final bill exceeds the payment made for the
estimated bill. PBL shall provide Golden Northwest the amounts
by which an estimated bill exceeds a final bill through either a
check or as a credit on the subsequent month's bill. After the
Due Date, a late payment charge shall be applied each day to any
unpaid balance. The late payment charge is calculated by
dividing the Prime Rate as reported in the Money Rates section
of Wall Street Journal, plus 4 percent; by 365. The applicable
Prime Rate shall be the rate reported on the first day of the
month in which payment is received. Golden Northwest shall pay
by electronic funds transfer using BPA's established procedures.
PBL may terminate this Agreement if Golden Northwest is more
than three months behind in paying its bills under this
Agreement and Golden Northwest cannot demonstrate an ability to
make the payments owed.
(c) DISPUTED BILLS
In case of a billing dispute, Golden Northwest shall note the
disputed amount and pay its bill in full by the Due Date. Unpaid
bills (including both disputed and undisputed amounts) are
subject to late payment charges provided above. If Golden
Northwest is entitled to a refund of any portion of the disputed
amount, then BPA shall make such refund with simple interest
computed from the date of receipt of the disputed payment to the
date the refund is made. The daily interest rate used to
determine the interest is calculated by dividing the Prime Rate
for Large Banks as reported in the Wall Street Journal; by 365.
The applicable Prime Rate for Large Banks shall be the rate
reported on the first day of the month in which payment is
received by BPA.
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11. NOTICES
Any notice required under this Agreement shall be in writing and shall
be delivered: (a) in person; (b) by a nationally recognized delivery
service; or (c) by United States Certified Mail. Notices are effective
when received. Either Party may change its address for notices by giving
notice of such change consistent with this section
If to Golden Northwest: If to PBL:
Golden Northwest Aluminum, Inc. Bonneville Power Administration
8000 NE Parkway Drive, Suite 300 P.O. Box 3621
Vancouver, WA 98662-6744 Portland, OR 97208-3621
Attn: Gerald F. Miller 905 N.E.11th Ave.
VP, Energy and Government Affairs Portland, OR 97232
Phone: 360-944-9755 Attn: Sydney D. Berwager - PT-6
FAX: 360-944-9930 Account Executive
E-Mail: goldendaleal@earthlink.net Phone: 503-230-5657
FAX: 503-230-3681
E-Mail: sdberwager@bpa.gov
12. COST RECOVERY
(a) Nothing included in or omitted from this Agreement creates or
extinguishes any right or obligation, if any, of BPA to assess
against Golden Northwest and Golden Northwest to pay to BPA at
any time a cost underrecovery charge pursuant to an applicable
transmission rate schedule or otherwise applicable law.
(b) BPA may adjust the rates for Contracted Power set forth in the
applicable power rate schedule during the term of this Agreement
only pursuant to the Cost Recovery Adjustment Clause (CRAC) in
the 2002 GRSPs.
(c) Any CRAC will be assessed against the full purchase obligation
specified in section 4 of this Agreement, notwithstanding any
curtailment by Golden Northwest pursuant to section 5 of this
Agreement.
(d) For as long as Golden Northwest purchases cost-based power from
BPA, this Agreement supercedes existing power sales contracts
and Golden Northwest will be subject to the same cost
underrecovery exposure as BPA's utility customers purchasing
Subscription power.
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13. UNCONTROLLABLE FORCES
PBL shall not be in breach of its obligation to provide Contracted Power
and Golden Northwest shall not be in breach of its obligation to
purchase Contracted Power to the extent the failure to fulfill that
obligation is due to an Uncontrollable Force. "Uncontrollable Force"
means an event beyond the reasonable control of, and without the fault
or negligence of, the Party claiming the Uncontrollable Force that
impairs that Party's ability to perform its contractual obligations
under this Agreement and which, by exercise of that Party's reasonable
diligence and foresight, such Party could not be expected to avoid and
was unable to avoid. Uncontrollable Forces include, but are not limited
to:
(a) any unplanned curtailment or interruption for any reason of firm
transmission used to deliver Contracted Power to Golden
Northwest's facilities, including but not limited to unplanned
maintenance outages;
(b) any unplanned curtailment or interruption, failure or imminent
failure of Golden Northwest's production or transmission
facilities, including but not limited to unplanned maintenance
outages;
(c) any planned transmission or distribution outage that affects
either Golden Northwest or PBL which was provided by a
third-party transmission or distribution owner, or by a
transmission provider, including TBL, that is functionally
separated from the generation provider in conformance with
Federal Energy Regulatory Commission (FERC) Orders 888 and 889
or its successors;
(d) strikes or work stoppage, including the threat of imminent
strikes or work stoppage;
(e) floods, earthquakes, or other natural disasters; and
(f) orders or injunctions issued by any court having competent
subject matter jurisdiction, or any order of an administrative
officer which the Party claiming the Uncontrollable Force, after
diligent efforts, was unable to have stayed, suspended, or set
aside pending review by a court of competent subject matter
jurisdiction.
Neither the unavailability of funds or financing, nor conditions of
national or local economies or markets shall be considered an
Uncontrollable Force. The economic hardship of either Party shall not
constitute an Uncontrollable Force. Nothing contained in this provision
shall be construed to require either Party to settle any strike or labor
dispute in which it may be involved.
The Party claiming the Uncontrollable Force shall notify the other Party
as soon as practicable of that Party's inability to meet its obligations
under this Agreement due to an Uncontrollable Force. The Party claiming
the Uncontrollable Force also agrees to notify any control area involved
in the scheduling of a transaction which may be curtailed due to an
Uncontrollable Force.
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Both Parties shall be excused from their respective obligations, other
than from payment obligations incurred prior to the Uncontrollable
Force, without liability to the other, for the duration of the
Uncontrollable Force and the period reasonably required for the Party
claiming the Uncontrollable Force, using due diligence, to restore its
operations to conditions existing prior to the occurrence of the
Uncontrollable Force.
14. GOVERNING LAW AND DISPUTE RESOLUTION
(a) This Agreement shall be interpreted consistent with and governed
by Federal law. Final actions subject to section 9(e) of the
Northwest Power Act are not subject to binding arbitration and
shall remain within the exclusive jurisdiction of the United
States Ninth Circuit Court of Appeals. Any dispute regarding any
rights of the Parties under any BPA policy, including the
implementation of such policy, shall not be subject to
arbitration under this Agreement. Golden Northwest reserves the
right to seek judicial resolution of any dispute arising under
this Agreement that is not subject to arbitration under this
section 14. For purposes of this section 14 BPA policy means any
written document adopted by BPA as a final action in a decision
record or record of decision that establishes a policy of
general application, or makes a determination under an
applicable statute. If either Party asserts that a dispute is
excluded from arbitration under this section 14, either Party
may apply to the Federal court having jurisdiction for an order
determining whether such dispute is subject to arbitration under
this section 14.
(b) Any contract dispute or contract issue between the Parties
arising out of this Agreement, except for disputes that are
excluded through section 14(a) above, shall be subject to
binding arbitration. The Parties shall make a good faith effort
to resolve such disputes before initiating arbitration
proceedings. During arbitration, the Parties shall continue
performance under this Agreement pending resolution of the
dispute, unless to do so would be impossible or impracticable.
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(c) Any arbitration shall take place in Portland, Oregon, unless the
Parties agree otherwise. The CPR Institute for Dispute
Resolution's arbitration procedures for commercial arbitration,
Non-Administered Arbitration Rules (CPR Rules), shall be used
for each dispute; provided, however, that: (1) the Parties shall
have the discovery rights provided in the Federal Rules of Civil
Procedure unless the Parties agree otherwise; and (2) for claims
of $1 million or more, each arbitration shall be conducted by a
panel of three neutral arbitrators. The Parties shall select the
arbitrators from a list containing the names of 15 qualified
individuals supplied by the CPR Institute for Dispute
Resolution. If the Parties cannot agree upon three arbitrators
on the list within 20 business days, the Parties shall take
turns striking names from the list of proposed arbitrators. The
Party initiating the arbitration shall take the first strike.
This process shall be repeated until three arbitrators remain on
the list, and those individuals shall be designated as the
arbitrators. For disputes involving less than $1 million, a
single neutral arbitrator shall be selected consistent with
section 6 of the CPR Rules.
(d) Except for arbitration awards which declare the rights and
duties of the Parties under this Agreement, the payment of
monies shall be the exclusive remedy available in any
arbitration proceeding. Under no circumstances shall specific
performance be an available remedy against BPA. The arbitration
award shall be final and binding on both Parties, except that
either Party may seek judicial review based upon any of the
grounds referred to in the Federal Arbitration Act, 9 U.S.C.
Section 1-16 (1988). Judgment upon the award rendered by the
arbitrators may be entered by any court having jurisdiction
thereof.
(e) Each Party shall be responsible for its own costs of
arbitration, including legal fees. The arbitrators may apportion
all other costs of arbitration between the Parties in such
manner as they deem reasonable taking into account the
circumstances of the case, the conduct of the Parties during the
proceeding, and the result of the arbitration.
15. STATUTORY PROVISIONS
(a) PRIORITY OF PACIFIC NORTHWEST CUSTOMERS
The provisions of sections 9(c) and (d) of the Northwest Power
Act and the provisions of P.L. 88-552 as amended by the
Northwest Power Act are incorporated into this Agreement by
reference. BPA agrees that Golden Northwest, together with other
customers in the Region shall have priority to BPA power,
consistent with such provisions.
(b) PROHIBITION ON RESALE
Golden Northwest shall not resell Industrial Firm Power except
as otherwise permitted by Federal law.
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(c) BPA APPROPRIATIONS REFINANCING ACT
The text of the BPA Refinancing Section of the Omnibus
Consolidated Recisions and Appropriations Act of 1996 (The BPA
Refinancing Act), P.L. No. 104-134, 110 Stat. 1321, 1350, is
incorporated in this Agreement as shown in Exhibit D, Additional
Products, Services, and Special Provisions.
16. STANDARD PROVISIONS
(a) AMENDMENTS
No oral or written amendment, rescission, waiver, modification,
or other change of this Agreement shall be of any force or
effect unless set forth in a written instrument signed by
authorized representatives of each Party.
(b) ASSIGNMENT
This Agreement is binding on any successors and assigns of the
Parties. BPA may assign this Agreement to another Federal agency
to which BPA's statutory duties have been transferred. The
consent of BPA is hereby given to an assignment of this
Agreement to a successor in interest of Golden Northwest, or any
Golden Northwest facility served directly by the PBL, for use at
any existing direct service industrial facility served directly
by the PBL on the date of the assignment. Neither Party may
otherwise transfer or assign this Agreement without the other
Party's written consent. Such consent shall not be unreasonably
withheld.
(c) INFORMATION EXCHANGE AND CONFIDENTIALITY
The Parties shall provide each other with any information that
is reasonably required, and requested by either Party in
writing, to operate under and administer this Agreement,
including load forecasts for planning purposes, information
needed to resolve billing disputes, scheduling, and metering
information reasonably necessary to prepare power bills that is
not otherwise available to the requesting Party. Such
information shall be provided in a timely manner. Information
may be exchanged by any means agreed to by the Parties. If such
information is subject to a privilege of confidentiality, a
confidentiality agreement or statutory restriction under state
or Federal law on its disclosure by a Party to this Agreement,
then that Party shall endeavor to obtain whatever consents,
releases, or agreements are necessary from the person holding
the privilege to provide such information while asserting the
confidentiality over the information. Information provided to
BPA which is subject to a privilege of confidentiality or
nondisclosure shall be clearly marked as such and BPA shall not
disclose such information without obtaining the consent of the
person or Party asserting the privilege, consistent with BPA's
obligation under the Freedom of Information Act. BPA may use
such information as necessary to provide service or timely bill
for service under this Agreement. BPA shall only disclose
information received under this provision to BPA employees who
need the information for purposes of this Agreement.
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(d) ENTIRE AGREEMENT
This Agreement, including all provisions, exhibits incorporated
as part of this Agreement, and documents incorporated by
reference, constitutes the entire agreement between the Parties.
It supersedes all previous communications, representations, or
contracts, either written or oral, which purport to describe or
embody the subject matter of this Agreement.
(e) EXHIBITS
The exhibits listed in the table of contents are incorporated
into this Agreement by reference. The exhibits may only be
revised upon mutual agreement between the Parties unless
otherwise specified in the exhibits. The body of this Agreement
shall prevail over the exhibits to this Agreement in the event
of a conflict.
(f) NO THIRD-PARTY BENEFICIARIES
This Agreement is made and entered into for the sole protection
and legal benefit of the Parties, and no other person shall be a
direct or indirect legal beneficiary of, or have any direct or
indirect cause of action or claim in connection with this
Agreement.
(g) WAIVERS
Any waiver at any time by either Party to this Agreement of its
rights with respect to any default or any other matter arising
in connection with this Agreement shall not be considered a
waiver with respect to any subsequent default or matter.
(h) BPA POLICIES
Any reference in this Agreement to BPA policies, including
without limitation BPA's New Large Single Load Policy and the
5(b)/9(c) Policy, and any revisions thereto, does not constitute
agreement by Golden Northwest to such policy, nor shall it be
construed to be a waiver of the right of Golden Northwest to
seek judicial review of any such policy.
(i) SEVERABILITY
If any term of this Agreement is found to be invalid by a court
of competent jurisdiction then such term shall remain in force
to the maximum extent permitted by law. All other terms shall
remain in force unless that term is determined not to be
severable from all other provisions of this Agreement by such
court.
(j) COMPROMISE APPROACH COVENANT
Golden Northwest agrees that BPA substantially sustained the
Compromise Approach in the Rate Case Final Record of Decision
(ROD) issued by BPA on May 15, 2000. As a consequence Golden
Northwest agrees:
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(1) Golden Northwest will not file suit in any court
challenging the sale of power by BPA to any Pacific
Northwest investor-owned utility (IOU) to serve the
residential and small farm loads of the IOU, or the rate
for such sales, for the Fiscal Year (FY) 2002-2006
period, unless such suit is filed: (A) on the 90th day
following the date of the final action being challenged;
and (B) in response to a suit filed or reasonably
expected to be filed by the IOUs or an IOU
representative, challenging power sales or rates for
service to the DSIs.
(2) Golden Northwest will not file suit in any court
challenging the Compromise Approach, as implemented in
BPA's 2002 Wholesale Power Rate Case Final ROD;
provided, however, that Golden Northwest may challenge
BPA's decision regarding adjustments as provided for in
the Compromise Approach.
(3) Golden Northwest agrees that its failure to comply with
any part of this provision will constitute a breach of
this Agreement, and that BPA may terminate this
Agreement in such case.
(k) HOLD HARMLESS
Each Party assumes all liability for injury or damage to persons
or property arising from the act or negligence of its own
employees, agents, members of governing bodies, or contractors.
Each Party shall indemnify and hold the other Party harmless
from any liability arising from such act or negligence.
17. TERMINATION
Golden Northwest may terminate this Agreement through a written notice
up to 30 days after FERC grants interim approval for BPA's wholesale
power rates that are effective October 1, 2001. In addition, Golden
Northwest shall have the right to terminate this Agreement if all of the
following conditions have been satisfied:
(a) Any rates adopted in WP-02 Final Rate Proposal, Administrator's
Final Record of Decision are remanded to BPA for reconsideration
by FERC or the Ninth Circuit Court of Appeals.
(b) As a result of the remand, the Administrator publishes a
subsequent Final Record of Decision which, if confirmed, would
result in Golden Northwest being subject to a higher average
effective power rate for the period beginning the first day of
the billing period immediately following the effective date of
new rates contained in the subsequent Final Record of Decision
and ending on September 30, 2006.
(c) Golden Northwest has provided written notice to BPA of its
intent to terminate this Agreement within 30 days of publication
of the subsequent Final Record of Decision.
Termination shall be effective at the start of the second billing period
following the termination notice.
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18. GOOD CORPORATE CITIZENSHIP CLAUSE
(a) BPA is directed by statute to market Federal power in the
Northwest first to public bodies and cooperatives, then to
investor-owned utilities, and then, at the Administrator's
discretion, to direct-service industries. Under this Agreement,
Golden Northwest shall comply with the requirements of
applicable Federal, State, and local laws and regulations
(including DOE regulations). Golden Northwest freely agrees that
the Administrator enters into this Agreement with a
direct-service industrial customer only with the express
qualification that during the term of this Agreement, Golden
Northwest shall remain in compliance as determined by the
Administrator, in his or her sole discretion, with all
applicable federal, state, and local laws, and all regulations
and orders implementing such laws, whether civil or criminal, as
a condition of Golden Northwest's right to receive power under
this Agreement. Golden Northwest acknowledges BPA's obligations
and policies pursuant to such applicable laws, and that Golden
Northwest will act in good faith as it relates to such laws and
policies.
(b) In the event that the Administrator determines, in his or her
sole discretion:
(1) that Golden Northwest is using power provided by the BPA
for the furtherance of an enterprise that is not in
compliance with all applicable federal, state, and local
laws, and all regulations and orders implementing such
laws, whether civil or criminal; and
(2) that such non-compliance, when considered in light of
the mission, goals, policies, and interests of the BPA:
(i) is egregious or persistent; and (ii) warrants the
temporary or permanent curtailment by BPA of the sale of
some or all of the power available under this Agreement
or any subsequent agreement with Golden Northwest;
then Golden Northwest agrees that the Administrator, in his or
her sole discretion, may temporarily or permanently curtail the
sale of some or all of the power available under this Agreement
or any future power agreement between Golden Northwest and BPA.
(c) The curtailment of power in paragraph (b) above will continue
until the Administrator determines, in his or her sole
discretion, that Golden Northwest is in compliance with all
applicable federal, state, and local laws, and all regulations
and orders implementing such laws, whether civil or criminal.
(d) The determinations of the Administrator referred to in
paragraphs (b) and (c) above shall only be made with the consent
of the Secretary of Energy, and after providing notice to Golden
Northwest. In making such determinations,
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the Administrator shall consider any relevant information that
may be obtained from Golden Northwest, federal or state agencies
or courts, or any other entity. The Administrator shall promptly
notify Golden Northwest before any such determination becomes
final.
19. SIGNATURES
The signatories represent that they are authorized to enter into this
Agreement on behalf of the Party for whom they sign.
GOLDEN NORTHWEST ALUMINUM, INC. UNITED STATES OF AMERICA
Department of Energy
Bonneville Power Administration
By /S/ BRETT WILCOX By /S/ SYDNEY D. BERWAGER
--------------------------------- ----------------------------------
Name BRETT WILCOX Name SYDNEY D. BERWAGER
------------------------------- --------------------------------
(Print/Type) (Print/Type)
Title CEO
-------------------------------
Date 10/30/00 Date 10/31/2000
------------------------------- --------------------------------
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EXHIBIT A
RATE COMMITMENTS
1. REVISIONS TO INDUSTRIAL FIRM POWER RATES
BPA agrees that the IP-02 rates available to Golden Northwest consistent
with this exhibit shall not be subject to revision during the term of
this Agreement, except for the application of a Cost Recovery Adjustment
Clause as provided in the IP-02 rates schedules and GRSPs and this
Agreement.
2. SPECIAL IP LOAD TREATMENT
ENVIRONMENTALLY PREFERRED POWER
Golden Northwest may request Environmentally Preferred Power. If
available, the Parties shall amend this Agreement to include necessary
provisions as mutually agreed.
3. REVISIONS
If this exhibit is inconsistent with BPA's 2002 Industrial Firm Power
Rate Schedule as finally approved by FERC, the Parties shall make a good
faith effort to amend this exhibit so that it is consistent.
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EXHIBIT B
BILLING
1. INDUSTRIAL FIRM POWER ENTITLEMENTS
(a) The MW amount shown in section 4 of the body of this Agreement
multiplied by: (1) the number of HLH; and (2) the number of LLH
in the applicable month establishes Golden Northwest's HLH and
LLH Energy Entitlements.
(b) The MW amount shown in section 4 of the body of this Agreement
establishes Golden Northwest's Demand Entitlement.
2. UNAUTHORIZED INCREASE CHARGE
Amounts Taken from PBL in excess of Contracted Power shall be subject to
the Unauthorized Increase Charge for demand and energy consistent with
the applicable BPA Wholesale Power Rate Schedules and GRSPs, unless such
power is provided under another contract with PBL. Power that has been
provided for energy imbalance service pursuant to an agreement between
TBL and Golden Northwest will not be subject to an Unauthorized Increase
Charge for Demand and Energy under this Agreement.
3. CONSERVATION AND RENEWABLES DISCOUNT
Subject to the terms specified in BPA's applicable Wholesale Power Rate
Schedules, including GRSPs, BPA shall apply the Conservation and
Renewables Discount to Golden Northwest's Contracted Power as
established in section 4 of the body of this Agreement unless Golden
Northwest has notified PBL before August 2001 that it will not
participate in the Conservation and Renewables Discount. For purposes of
establishing power amounts eligible for this discount, Golden Northwest
shall provide PBL either: (a) a reasonable forecast of such firm power
amounts through Contract Year 2006; or (b) notice Golden Northwest
chooses not to have the Conservation and Renewables Discount applied to
its Contracted Power by no later than August 1, 2001.
If during any Contract Year, Golden Northwest has significant load loss
or gain, the Parties may, by no later than August 31 prior to the
succeeding Contract Year, revise the forecast used to calculate the
Conservation and Renewables Discount. If the revised forecast is less
than 95 percent of, or greater than 105 percent of, the forecast used to
calculate the existing Conservation and Renewables Discount, the revised
forecast shall be used to recalculate the Conservation and Renewables
Discount for the succeeding Contract Years.
To retain the full amount of the Conservation and Renewables Discount
Golden Northwest shall satisfy all obligations associated with the
Conservation and Renewables Discount as specified in BPA's applicable
Wholesale Power Rate Schedules, including GRSPs and the Conservation and
Renewables Discount implementation manual. Golden Northwest shall
reimburse BPA for any amount it received but for which it did not
satisfy such obligations.
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4. REVISIONS
If this exhibit is inconsistent with BPA's 2002 Industrial Firm Power
Rate Schedule as finally approved by FERC, the Parties shall make a good
faith effort to amend this exhibit so that it is consistent.
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EXHIBIT C
POWER RATE
A. DEMAND RATE
1. FLAT RATE DEMAND FOR FY 2002 THROUGH 2006
1.1 APPLICABILITY
These rates apply to eligible customers purchasing power.
1.2 RATE TABLE
----------------------------------------------------------
APPLICABLE MONTHS RATE
----------------------------------------------------------
January $2.16/kW-mo
February $2.03/kW-mo
March $1.82/kW-mo
April $1.45/kW-mo
May $1.43/kW-mo
June $1.79/kW-mo
July $2.31/kW-mo
August $2.31/kW-mo
September $2.31/kW-mo
October $1.76/kW-mo
November $2.31/kW-mo
December $2.31/kW-mo
----------------------------------------------------------
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B. ENERGY RATE FOR IPTAC (A) PRODUCT
1. MONTHLY ENERGY RATES FOR FY 2002 THROUGH FY 2006
1.1 APPLICABILITY
These rates apply to eligible customers purchasing power.
1.2 RATE TABLE
------------------------------------------------------------------------
HLH LLH
APPLICABLE MONTHS RATE RATE
------------------------------------------------------------------------
January 23.88 mills/kWh 17.90 mills/kWh
February 22.33 mills/kWh 16.90 mills/kWh
March 20.59 mills/kWh 15.18 mills/kWh
April 16.94 mills/kWh 12.57 mills/kWh
May 16.88 mills/kWh 11.00 mills/kWh
June 20.20 mills/kWh 12.55 mills/kWh
July 25.38 mills/kWh 18.45 mills/kWh
August 35.78mills/kWh 21.68 mills/kWh
September 26.70 mills/kWh 22.55 mills/kWh
October 20.03 mills/kWh 15.52 mills/kWh
November 25.76 mills/kWh 21.47 mills/kWh
December 26.41 mills/kWh 21.13 mills/kWh
------------------------------------------------------------------------
Rates in Rate Table includes the IPTAC (A) (2.02 mills) adder.
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EXHIBIT D
ADDITIONAL PRODUCTS, SERVICES, AND SPECIAL PROVISIONS
1. ADDITIONAL PRODUCTS, SERVICES, AND SPECIAL PROVISIONS
BPA APPROPRIATIONS REFINANCING ACT
In accordance with section 15(c) of the body of this Agreement the
following is included in this Agreement.
BONNEVILLE POWER ADMINISTRATION REFINANCING SECTION
OF THE OMNIBUS CONSOLIDATED RECISSIONS AND APPROPRIATIONS ACT OF 1996
16 UNITED STATES CODE Chapter 12G
Act of April 26, 1996, 110 Stat. 1321, 1350
Public Law No. 104-134, H.R. 3019 (S. 1594)
838L. BONNEVILLE POWER ADMINISTRATION REFINANCING
838L(a). DEFINITIONS
For the purposes of this section--
838L(a)(1). "Administrator" means the Administrator of the
Bonneville Power Administration;
838L(a)(2). "capital investment" means a capitalized cost funded
by Federal appropriations that--
838L(a)(2)(A). is for a project, facility, or separable unit or
feature of a project or facility;
838L(a)(2)(B). is a cost for which the Administrator is required
by law to establish rates to repay to the United States Treasury through
the sale of electric power, transmission, or other services;
838L(a)(2)(C). excludes a Federal irrigation investment; and
838L(a)(2)(D). excludes an investment financed by the current
revenues of the Administrator or by bonds issued and sold, or authorized
to be issued and sold, by the Administrator under section 838k of this
title;
838L(a)(3). "new capital investment" means a capital investment
for a project, facility, or separable unit or feature of a project or
facility, placed in service after September 30, 1996;
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838L(a)(4). "old capital investment" means a capital investment
the capitalized cost of which--
838L(a)(4)(A). was incurred, but not repaid, before October 1,
1996, and
838L(a)(4)(B). was for a project, facility, or separable unit or
feature of a project or facility, placed in service before October 1,
1996;
838L(a)(5). "repayment date" means the end of the period within
which the Administrator's rates are to assure the repayment of the
principal amount of a capital investment; and
838L(a)(6). "Treasury rate" means--
838L(a)(6)(A). for an old capital investment, a rate determined
by the Secretary of the Treasury, taking into consideration prevailing
market yields, during the month preceding October 1, 1996, on
outstanding interest-bearing obligations of the United States with
periods to maturity comparable to the period between October 1, 1996,
and the repayment date for the old capital investment; and
838L(a)(6)(B). for a new capital investment, a rate determined
by the Secretary of the Treasury, taking into consideration prevailing
market yields, during the month preceding the beginning of the fiscal
year in which the related project, facility, or separable unit or
feature is placed in service, on outstanding interest-bearing
obligations of the United States with periods to maturity comparable to
the period between the beginning of the fiscal year and the repayment
date for the new capital investment.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
838L(b). NEW PRINCIPAL AMOUNTS
838L(b)(1). PRINCIPLE AMOUNT
Effective October 1, 1996, an old capital investment has a new
principal amount that is the sum of--
838L(b)(1)(A). the present value of the old payment amounts for
the old capital investment, calculated using a discount rate equal to
the Treasury rate for the old capital investment; and
838L(b)(1)(B). an amount equal to $ 100,000,000 multiplied by a
fraction whose numerator is the principal amount of the old payment
amounts for the old capital investment and whose denominator is the sum
of the principal amounts of the old payment amounts for all old capital
investments.
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838L(b)(2). DETERMINATION
With the approval of the Secretary of the Treasury based solely
on consistency with this section, the Administrator shall determine the
new principal amounts under subsection (b) and the assignment of
interest rates to the new principal amounts under subsection (c).
838L(b)(3). OLD PAYMENT AMOUNTS
For the purposes of this subsection, "old payment amounts"
means, for an old capital investment, the annual interest and principal
that the Administrator would have paid to the United States Treasury
from October 1, 1996, if this section had not been enacted, assuming
that--
838L(b)(3)(A). the principal were repaid--
838L(b)(3)(A)(i). on the repayment date the Administrator
assigned before October 1, 1994, to the old capital investment, or
838L(b)(3)(A)(ii). with respect to an old capital investment for
which the Administrator has not assigned a repayment date before October
1, 1994, on a repayment date the Administrator shall assign to the old
capital investment in accordance with paragraph 10(d)(1) of the version
of Department of Energy Order RA 6120.2 in effect on October 1, 1994;
and
838L(b)(3)(B). interest were paid--
838L(b)(3)(B)(i). at the interest rate the Administrator
assigned before October 1, 1994, to the old capital investment, or
838L(b)(3)(B)(ii). with respect to an old capital investment for
which the Administrator has not assigned an interest rate before October
1, 1994, at a rate determined by the Secretary of the Treasury, taking
into consideration prevailing market yields, during the month preceding
the beginning of the fiscal year in which the related project, facility,
or separable unit or feature is placed in service, on outstanding
interest-bearing obligations of the United States with periods to
maturity comparable to the period between the beginning of the fiscal
year and the repayment date for the old capital investment.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
838L(c). INTEREST RATE FOR NEW PRINCIPLE AMOUNTS
As of October 1, 1996, the unpaid balance on the new principal
amount established for an old capital investment under subsection (b)
bears interest annually at the Treasury rate for the old capital
investment until the earlier of the date that the new principal amount
is repaid or the repayment date for the new principal amount.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
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838L(d). REPAYMENT DATES
As of October 1, 1996, the repayment date for the new principal
amount established for an old capital investment under subsection (b) is
no earlier than the repayment date for the old capital investment
assumed in subsection (b)(3)(A). [P.L. 104-134, Title III, Section 3201,
110 Stat. 1321-350.]
838L(e). PREPAYMENT LIMITATIONS
During the period October 1, 1996, through September 30, 2001,
the total new principal amounts of old capital investments, as
established under subsection (b), that the Administrator may pay before
their respective repayment dates shall not exceed $100,000,000.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
838L(f). INTEREST RATES FOR NEW CAPITAL INVESTMENTS DURING
CONSTRUCTION
838L(f)(1). NEW CAPITAL INVESTMENT
The principal amount of a new capital investment includes
interest in each fiscal year of construction of the related project,
facility, or separable unit or feature at a rate equal to the one year
rate for the fiscal year on the sum of--
838L(f)(1)(A). construction expenditures that were made from the
date construction commenced through the end of the fiscal year, and
838L(f)(1)(B). accrued interest during construction.
838L(f)(2). PAYMENT
The Administrator is not required to pay, during construction of
the project, facility, or separable unit or feature, the interest
calculated, accrued, and capitalized under subsection (f)(1).
838L(f)(3). ONE-YEAR RATE
For the purposes of this section, "one year rate" for a fiscal
year means a rate determined by the Secretary of the Treasury, taking
into consideration prevailing market yields, during the month preceding
the beginning of the fiscal year, on outstanding interest-bearing
obligations of the United States with periods to maturity of
approximately one year.
838L(g). INTEREST RATES FOR NEW CAPITAL INVESTMENTS
The unpaid balance on the principal amount of a new capital
investment bears interest at the Treasury rate for the new capital
investment from the date the related project, facility, or separable
unit or feature is placed in service until the earlier of the date the
new capital investment is repaid or the repayment date for the new
capital investment.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
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838L(h). OMITTED
838L(i). CONTRACT PROVISIONS
In each contract of the Administrator that provides for the
Administrator to sell electric power, transmission, or related services,
and that is in effect after September 30, 1996, the Administrator shall
offer to include, or as the case may be, shall offer to amend to
include, provisions specifying that after September 30, 1996--
838L(i)(1). the Administrator shall establish rates and charges
on the basis that--
838L(i)(1)(A). the principal amount of an old capital investment
shall be no greater than the new principal amount established under
subsection (b);
838L(i)(1)(B). the interest rate applicable to the unpaid
balance of the new principal amount of an old capital investment shall
be no greater than the interest rate established under subsection (c);
838L(i)(1)(C). any payment of principal of an old capital
investment shall reduce the outstanding principal balance of the old
capital investment in the amount of the payment at the time the payment
is tendered; and
838L(i)(1)(D). any payment of interest on the unpaid balance of
the new principal amount of an old capital investment shall be a credit
against the appropriate interest account in the amount of the payment at
the time the payment is tendered;
838L(i)(2). apart from charges necessary to repay the new
principal amount of an old capital investment as established under
subsection (b) and to pay the interest on the principal amount under
subsection (c), no amount may be charged for return to the United States
Treasury as repayment for or return on an old capital investment,
whether by way of rate, rent, lease payment, assessment, user charge, or
any other fee;
838L(i)(3). amounts provided under section 1304 of title 31,
United States Code, shall be available to pay, and shall be the sole
source for payment of, a judgment against or settlement by the
Administrator or the United States on a claim for a breach of the
contract provisions required by this Part; and
838L(i)(4). the contract provisions specified in this Part do
not--
838L(i)(4)(A). preclude the Administrator from recovering,
through rates or other means, any tax that is generally imposed on
electric utilities in the United States, or
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838L(i)(4)(B). affect the Administrator's authority under
applicable law, including section 7(g) of the Pacific Northwest Electric
Power Planning and Conservation Act (16 U.S.C. Section 839e(g)), to--
838L(i)(4)(B)(i). allocate costs and benefits, including but not
limited to fish and wildlife costs, to rates or resources, or
838L(i)(4)(B)(ii). design rates.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
838L(j). SAVINGS PROVISIONS
838L(j)(1). REPAYMENT
This subchapter does not affect the obligation of the
Administrator to repay the principal associated with each capital
investment, and to pay interest on the principal, only from the
"Administrator's net proceeds," as defined in section 838k(b) of this
title.
838L(j)(2). PAYMENT OF CAPITAL INVESTMENT
Except as provided in subsection (e), this section does not
affect the authority of the Administrator to pay all or a portion of the
principal amount associated with a capital investment before the
repayment date for the principal amount.
[P.L. 104-134, Title III, Section 3201, 110 Stat. 1321-350.]
[End BPA Appropriations Refinancing Act.]
2. REVISIONS
This exhibit shall be revised by mutual agreement of the Parties to
reflect additional products Golden Northwest purchases during the term
of this Agreement.
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EXHIBIT E
SCHEDULING
1. PURPOSE OF THIS EXHIBIT
The purpose of this exhibit is to identify power scheduling requirements
and coordination procedures necessary for the delivery of electric power
and energy sold under this Agreement. All provisions apply to
Purchasing-Selling Entities (PSEs), including their authorized
scheduling agent. Transmission scheduling arrangements are handled under
separate agreements/provisions with the designated transmission
provider. Nothing in this exhibit is intended to relieve the Parties of
any obligation they may have under North American Electric Reliability
Council (NERC) or Western Systems Coordinating Council (WSCC) policy,
procedure, or guideline.
2. COORDINATION: GENERAL, PRESCHEDULE, REAL-TIME, AND AFTER-THE-FACT
REQUIREMENTS
(a) GENERAL REQUIREMENTS
(1) The Parties may revise and replace this exhibit by
mutual agreement. BPA shall also have the right to
revise and replace this exhibit under the following
circumstances after providing an opportunity for all
affected Parties to discuss and comment on any proposed
changes: (1) to comply with rules or orders issued by
FERC, NERC, or WSCC; or (2) to implement changes
reasonably consistent with standard industry practice,
but necessary for BPA to administer it's power
scheduling function.
(2) PSEs shall have staff available 24 hours a day for each
day an active transaction or preschedule is in effect.
PSE's must be prepared to verify transactions on an
hourly basis if necessary.
(3) PSEs shall complete the prescheduling and check out
processes, and to verify Transactions and associated
totals, per NERC tag, and BPA contract.
(4) Inability to verify Transactions may result in schedule
rejection or curtailment.
(5) PSEs shall verify Transactions and totals after-the-fact
(ATF) per both parties' ATF processes.
(6) BPA is not obligated to accept Transactions that do not
comply with the scheduling requirements in this exhibit
or the contract.
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(7) Should a PSE attempt to preschedule a Transaction for
power for which that PSE has an obligation to provide
transmission and fails to properly reserve the
transmission necessary to complete the Transaction, the
PSE will not be excused from its payment obligation, if
any, under this Agreement.
(8) All Transactions shall be stated in the time zone
specified by WSCC and shall be in "hour-ending" format.
(9) All Schedules, except Dynamic Schedules, will be
implemented on an hourly basis using the standard ramp
as specified by WSCC procedures.
(10) Any power that is allowed to be resold at wholesale
under this Agreement may only be resold if all
characteristics of the product (e.g., Point of Receipt,
shape, hours) are maintained in the resale.
(11) Changes to telephone or fax numbers of key personnel
(for Prescheduling, Real-Time, Control Area, or
Scheduling Agents, etc.) must be submitted to BPA.
(b) PRESCHEDULING REQUIREMENTS
(1) INFORMATION REQUIRED FOR ANY PRESCHEDULE
(A) Unless otherwise mutually agreed, all
Transactions will be submitted according to NERC
instructions for E-tagging, as modified by WSCC.
(B) When completing the NERC E-Tag insert the
applicable BPA Contract number(s) in the
"reference" column of the miscellaneous section
of the tag.
(C) Transactions going to or from California-Oregon
Border (COB) must be identified as using Malin
or Captain Jack, or COB Hub.
(2) PRESCHEDULE COORDINATION
(A) Final hourly preschedules (verbal submission of
E-tag information) must be submitted for the
next day(s) by 1000 of each workday, unless
otherwise agreed.
(B) Typically, preschedules are for one to three
days by mutual agreement of the parties, final
preschedules may be requested for longer time
periods to accommodate special scheduling
requirements.
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(C) Under certain operating conditions, either party
may require submission of estimated daily
preschedules for an ensuing period up to 10 days
in length, prior to the final preschedule.
(c) REAL-TIME REQUIREMENTS
(1) PSEs may not make Real-Time changes to the scheduled
amounts, including transmission arrangements unless such
changes are allowed under individual contract provisions
or by mutual agreement.
(2) If Real-Time changes to the Schedule become necessary,
and are allowable as described in section 2(c)(1) above,
PSEs must submit such request no later than 30 minutes
prior to the hour for which the Schedule change becomes
effective.
(3) Multihour changes to the Schedule shall specify each
hour to be changed and shall not be stated as "until
further notice."
(4) Emergency scheduling and notification procedures
(including mid-hour changes) will be handled in
accordance with NERC and WSCC procedures.
(d) AFTER-THE-FACT RECONCILIATION REQUIREMENTS
PSEs agree to reconcile all Transactions, Schedules and accounts
at the end of each month (as early as possible within the first
10 calendar days of the next month). The parties will verify all
Transactions per BPA contract, as to product or type of service,
hourly amounts, daily and monthly totals, and related charges.
3. DEFINITIONS AND ACRONYMS
Capitalized terms in this Exhibit shall have the meanings defined below,
in context, or as used elsewhere in this Agreement.
(a) CONTROL AREA: An electrical system bounded by interconnection
(tie-line) metering and telemetry. It controls generation
directly to maintain its interchange schedule with other control
areas and contributes to frequency regulation of the
interconnection.
(b) HOUR ENDING: Designation for one hour periods of time based upon
the time which the period ends. For example: the one hour period
between 1300 and 1400 is referred to as Hour Ending 1400.
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(c) PRESCHEDULING: The process (electronic, oral, and written) of
establishing and verifying with all scheduling parties, advance
hourly Transactions through the following Workday(s).
Preschedules apply to the following day or days (if the
following day or days are not Workday(s).
(d) PURCHASING-SELLING ENTITY (PSE): (NERC defined term). An entity
that is eligible to purchase or sell energy or capacity and
reserve transmission services.
(e) REAL-TIME: The hourly or minute-to-minute operation and
scheduling of a power system as opposed to those operations
which are prescheduled a day or more in advance.
(f) SCHEDULE: The planned Transaction approved and accepted by all
PSEs and Control Areas involved in the Transaction.
(g) TRANSACTION: An agreement arranged by a PSE to transfer energy
from a seller to a buyer.
(h) WORKDAY: Any day BPA, other regional utilities, and PSEs observe
as a working day.
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