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Agenda Report - July 15, 2015 C-15
AGENDA ITEM Cam15 CITY OF LODI COUNCIL COMMUNICATION • TM AGENDA TITLE: Adopt Resolution Authorizing the City Manager to Execute Pacific Gas and Electric Company Interconnection Agreement MEETING DATE: July 15, 2015 PREPARED BY: Electric Utility Director RECOMMENDED ACTION: Adopt a resolution authorizing the City Manager to execute the Pacific Gas and Electric Company Interconnection Agreement. BACKGROUND INFORMATION: The Northern California Power Agency (NCPA), Pacific Gas and Electric (PG&E), and the balance of NCPA Member Customers (including the Cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Palo Alto, Ukiah, and Plumas Sierra Rural Electric Cooperative) are parties to Service Agreement No. 17 under the PG&E Federal Energy Regulatory Commission (FERC) Electric Tariff Volume No. 5 (Interconnection Agreement), attached as Exhibit A. The Interconnection Agreement contains the terms and conditions under which the parties coordinate operations of the electrical interconnections between their respective electric systems. The Interconnection Agreement became effective on September 1, 2002, and is set to expire on October 31, 2015. The Interconnection Agreement contains the terms and conditions under which each of the NCPA Member Customer Points of Interconnection will be operated in coordination with PG&E including, but not limited to: • Requirements for modifying Points of Interconnection • Operational and planning requirements • Obligations of the parties resulting from significant regulatory and operational changes • Installation and access requirements • Metering and metering equipment standards • Administrative and billing procedures The Interconnection Agreement also contains several appendices identifying specific procedures associated with dispute resolution and arbitration, requirements for installation of upgraded facilities, billing and payment instructions, and operational coordination requirements — including Underfrequency Load Shedding (UFLS) obligations. The purpose of UFLS is to balance generation and load when an event causes a drop in frequency of an interconnection. In February 2014, Lodi Electric Utility (LEU) received notice from the North American Electric Reliability Corporation (NERC) regarding LEU's deactivation of its registration as a Distribution Provider (DP) / Load Serving Entity (LSE) resulting in the elimination of mandatory compliance with NERC reliability standards. As such, in October 2014, the City Council approved the suspension of the applicable sections of LEU's Risk Management and Compliance Program (RMCP). While mandatory compliance provisions were eliminated, LEU still continued to follow said provisions as a good utility operating practice. The UFLS obligations in the Interconnection Agreement will result in LEU's re -activation of its registration as a APPROVED: � ' - ' p en Sch w-abaLu,-(jCity Manager Adopt Resolution Authorizing the City Manager to Execute Pacific Gas and Electric Company Interconnection Agreement July 15, 2015 Page 2 of 2 DP/LSE and mandatory compliance with NERC reliability standards. LEU will return to City Council at a future date to again activate the applicable sections of the LEU RMCP. While all of the Points of Interconnection covered under the Interconnection Agreement are owned and operated by the NCPA Member Customers, NCPA is a signatory to the Interconnection Agreement due to its role as the NCPA Member Customers' portfolio manager. NCPA shall provide support services to the NCPA Member Customers, including, but not limited to, assisting NCPA Member Customers in performing impact studies and resolving disputes with PG&E. The Interconnection Agreement will become effective on November 1, 2015, and will have a term of 10 years. NCPA, PG&E, and each NCPA Member Customer will be a signatory to the Interconnection Agreement. On June 24, 2015, the Risk Oversight Committee received a report on this agenda item and recommended City Council approval. FISCAL IMPACT: Not applicable. FUNDING AVAILABLE: Not applicable. _ 'E zabe h A. Kirkley Electric Utility Director PREPARED BY: Melissa Price-Cadek, Rates & Resources Manager EAK/MPC/Ist PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 Interconnection Agreement Between Pacific Gas and Electric Company and Northern California Power Agency and City of Alameda, City of Biggs, City of Gridley, City of Healdsburg, City of Lodi, City of Lompoc, City of Palo Alto, City of Ukiah, and Plumas-Sierra Rural Electric Cooperative Service Agreement No. under PG&E FERC Electric Tariff Volume No. 5 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 Table of Contents 1 PREAMBLE............................................................................................................................ 6 2 RECITALS.............................................................................................................................. 6 3 AGREEMENT......................................................................................................................... 8 4 DEFINITIONS......................................................................................................................... 8 4.1 Use of Terms..................................................................................................................... 8 4.1.1 Adverse Impact.............................................................................................................. 9 4.1.2 Agreement...................................................................................................................... 9 4.1.3 Applicable Requirements............................................................................................... 9 4.1.4 Balancing Authority Area Arrangements.................................................................... 10 4.1.5 Control Center.............................................................................................................. 10 4.1.6 Cost.............................................................................................................................. 10 4.1.7 CPUC........................................................................................................................... 10 4.1.8 Direct Assignment Facilities........................................................................................ 10 4.1.9 Effective Date.............................................................................................................. 11 4.1.10 Electric System.......................................................................................................... 11 4. 1.11 Engineering and Operating (E & O) Committee....................................................... 11 4.1.12 Existing Contracts...................................................................................................... 11 4.1.13 Facility Study............................................................................................................. 11 4.1.14 Interconnection Capacity........................................................................................... 12 4.1.15 Interconnection Facilities........................................................................................... 12 4.1.16 Long -Term Change to Operations............................................................................. 12 4.1.17 Modification............................................................................................................... 13 4.1.18 New Facility Addition................................................................................................ 14 4.1.19 PG&E Transmission Owner Tariff (PG&E TO Tariff) ............................................. 14 4.1.20 PG&E Wholesale Distribution Tariff (PG&E WD Tariff) ........................................ 14 4.1.21 Point(s) Of Interconnection........................................................................................ 14 4.1.22 Operating Agreement................................................................................................. 14 4.1.23 Remote Telemetry Unit (RTU).................................................................................. 14 4.1.24 Responsible Meter Party............................................................................................ 15 4.1.25 Service Area............................................................................................................... 15 4.1.26 System Impact Study................................................................................................. 15 4.1.27 System Reinforcements............................................................................................. 15 4.1.28 Third Party................................................................................................................. 15 4.1.29 Transfer Capability.................................................................................................... 16 4.1.30 Transmission Arrangement........................................................................................ 16 4.1.31 Transmission Operations Center................................................................................ 16 4.1.32 Transmission Facilities Agreement............................................................................ 16 4.1.33 Uncontrollable Force................................................................................................. 16 4.1.34 Upgrade Facility......................................................................................................... 16 5 SCOPE................................................................................................................................... 17 5.1 Interconnected Operations.............................................................................................. 17 5.2 Effective Date................................................................................................................. 17 2 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. 5.3 Termination..................................................................................................................... 18 6 INTERCONNECTIONS........................................................................................................ 18 6.1 Interconnection Capacity................................................................................................ 18 6.2 Establishing or Modifying Point(s) of Interconnection.................................................. 19 6.3 New Interconnection Facilities and Upgrades................................................................ 19 6.4 Construction Plan and Agreement.................................................................................. 20 6.5 Test Period for Interconnection...................................................................................... 20 7 BALANCING AUTHORITY AREA ARRANGEMENTS.................................................. 20 8 SYSTEM PLANNING COORDINATION........................................................................... 21 8.1 Planning Process............................................................................................................. 22 8.2 System Reinforcements.................................................................................................. 22 9 OPERATING PROVISIONS................................................................................................ 23 9.1 Good Utility Practice and Applicable Requirements Obligation .................................... 23 9.2 General............................................................................................................................ 23 9.3 Power Delivery and Quality Standard............................................................................ 23 9.4 Coordination Of Operations............................................................................................ 23 9.5 Relationship To Balancing Authority Area Operations .................................................. 24 9.6 Separate Balancing Authority Area................................................................................ 24 9.7 Reporting Significant Events.......................................................................................... 24 9.8 Engineering And Operating Committee......................................................................... 25 9.8.1 E&O Committee Meetings.......................................................................................... 26 9.8.2 E&O Committee Expenses.......................................................................................... 26 9.8.3 E&O Committee Authority.......................................................................................... 27 9.9 Settlement of Disputes and Arbitration........................................................................... 27 9.10 Protective Devices........................................................................................................ 27 9.11 Requirements for NCPA or NCPA Member Customer Operated Generators Connected toPG&E................................................................................................................................ 27 9.12 Continuity Of Service................................................................................................... 28 9.12.1 Operation Actions To Maintain Continuity............................................................... 28 9.12.2 Unscheduled Interruptions......................................................................................... 28 9.12.3 Scheduled Interruptions............................................................................................. 29 9.12.4 Interruption By Protective Devices............................................................................ 29 9.12.5 Jeopardy..................................................................................................................... 29 9.13 Operating Records........................................................................................................ 30 9.14 Confidentiality.............................................................................................................. 30 10 SIGNIFICANT REGULATORY OR OPERATIONAL CHANGE ................................... 32 10.1 Significant Regulatory Change..................................................................................... 32 10.2 Significant Operational Change.................................................................................... 32 10.3 Change in Functions or Scope...................................................................................... 33 10.4 Notification of Significant Regulatory or Operational Change .................................... 33 10.5 Amendment of Agreement............................................................................................ 34 10.6 Studies of Significant Operational Change................................................................... 34 10.7 Mitigation And Costs.................................................................................................... 35 10.8 Failure To Notify Of Significant Operational Changes ................................................ 36 11 INSTALLATION AND ACCESS....................................................................................... 37 12 METERING......................................................................................................................... 37 3 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. 12.1 Delivery Meters............................................................................................................ 37 12.2 Requirements For Meters And Meter Maintenance...................................................... 38 12.3 The NCPA Parties' Obligation To Provide Meter Data To PG&E .............................. 38 12.4 Consequences of Failing to Provide Meter Data.......................................................... 38 12.5 Periodic Meter Testing.................................................................................................. 39 13 BILLING AND PAYMENT................................................................................................ 39 14 ACCOUNTING................................................................................................................... 40 14.1 Accounting Procedures................................................................................................. 40 14.2 Audit Rights.................................................................................................................. 40 15 ADVERSE DETERMINATION OR EXPANSION OF OBLIGATIONS ......................... 40 15.1 Adverse Determination................................................................................................. 40 15.2 Expansion Of Obligations............................................................................................. 41 15.3 Renegotiation................................................................................................................ 41 16 ASSIGNMENT.................................................................................................................... 41 16.1 Consent Required.......................................................................................................... 41 16.2 Assignee's Continuing Obligation................................................................................ 42 17 CAPTIONS.......................................................................................................................... 42 18 CONSTRUCTION OF THE AGREEMENT...................................................................... 42 19 CONTROL AND OWNERSHIP OF FACILITIES............................................................ 42 20 COOPERATION AND RIGHT OF ACCESS AND INSPECTION .................................. 43 21 DEFAULT........................................................................................................................... 43 21.1 Termination For Default............................................................................................... 43 21.2 Other Remedies For Default......................................................................................... 44 22 DISPUTE RESOLUTION................................................................................................... 44 23 GOVERNING LAW............................................................................................................ 44 24 INDEMNITY....................................................................................................................... 44 24.1 Definitions..................................................................................................................... 44 24.1.1 Accidents.................................................................................................................... 44 24.2 Indemnity Duty............................................................................................................. 45 25 JUDGMENTS AND DETERMINATIONS........................................................................ 46 26 LIABILITY.......................................................................................................................... 46 26.1 To Third Parties............................................................................................................ 46 26.2 No Consequential, Special or Indirect Damages from Breach ..................................... 46 26.3 Protection Of A Party's Own Facilities........................................................................ 46 26.4 Liability For Interruptions............................................................................................. 47 27 NO DEDICATION OF FACILITIES.................................................................................. 47 28 NO OBLIGATION TO OFFER SAME SERVICE TO OTHERS ...................................... 47 29 NO PRECEDENT................................................................................................................ 47 30 NO OTHER SERVICES PROVIDED................................................................................ 48 30.1 Limitation on Parties Obligation................................................................................... 48 30.2 Transmission Arrangements......................................................................................... 48 31 NOTICES............................................................................................................................. 49 3 1. 1 Written Notices............................................................................................................. 49 31.2 Changes Of Notice Recipient........................................................................................ 52 31.3 Routine Notices............................................................................................................. 52 31.4 Reliance On Notice....................................................................................................... 53 0 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 32 RESERVATION OF RIGHTS............................................................................................ 53 33 RESPONSIBILITY FOR PAYMENTS AND SECURITY ................................................ 53 34 RULES AND REGULATIONS.......................................................................................... 54 35 SEVERABILITY................................................................................................................. 54 36 CONTINUING RIGHTS OF THE NCPA PARTIES UPON TERMINATION ................. 54 37 RIGHTS OF PG&E UPON TERMINATION..................................................................... 55 38 WAIVER OF RIGHTS........................................................................................................ 55 39 UNCONTROLLABLE FORCES........................................................................................ 55 40 ENTIRE AGREEMENT AND AMENDMENTS............................................................... 55 41 NO THIRD PARTY RIGHTS OR OBLIGATION............................................................. 56 42 WARRANTY OF AUTHORITY........................................................................................ 56 43 COUNTERPARTS.............................................................................................................. 56 44 APPENDICES INCLUDED................................................................................................ 57 45 EXECUTION....................................................................................................................... 58 APPENDIX A POINTS OF INTERCONNECTION.................................................................. 61 APPENDIX B DISPUTE RESOLUTION AND ARBITRATION ............................................. 72 APPENDIX C UPGRADE FACILITIES.................................................................................... 75 APPENDIX D BILLING AND PAYMENT............................................................................... 77 APPENDIX E OPERATIONAL CCORDINATION.................................................................. 80 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. NORTHERN CALIFORNIA POWER AGENCY INTERCONNECTION AGREEMENT 1 PREAMBLE This Interconnection Agreement (Agreement) is made this day of , 20 by and between Pacific Gas and Electric Company (PG&E), a corporation organized and existing under the laws of the State of California, and the Northern California Power Agency (NCPA), a joint powers agency of the State of California, and the California Cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Palo Alto, Ukiah, and the Plumas-Sierra Rural Electric Cooperative, Inc., (hereinafter referred to collectively as "NCPA Member Customers"), any or all of which are hereinafter referred to individually as a "Party" and collectively as "the Parties." NCPA and the NCPA Member Customers are hereinafter referred to collectively as "the NCPA Parties." 2 RECITALS 2.1 Whereas, it is the policy of the Federal Energy Regulatory Commission (FERC) that open and non-discriminatory access to transmission be provided through transmission systems comprising as large an area as possible under the supervision and direction of an independent system operator or a regional transmission organization; and 2.2 Whereas, PG&E is registered with the North American Electric Reliability Corporation (NERC) as a Transmission Owner (TO), and as a Transmission Operator (TOP) in accordance with the NERC compliance registry process; and 2.3 Whereas, PG&E is a public utility providing both wholesale and retail electric power and energy sales and transmission and distribution services in northern and central California and owns an extensive electric transmission system within that area; and 2.4 Whereas, PG&E transferred operational control of its transmission system to the California Independent System Operator Corporation (CAISO), and is now a Participating Transmission Owner and a party to the CAISO's Transmission Control Agreement, under which PG&E is subject to the direction of the CAISO in the operation of its transmission system and under which the CAISO becomes the provider of transmission service over PG&E's transmission system, pursuant to the terms of the CAISO Tariff, the PG&E TO Tariff, Transmission Control on PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Agreement, Scheduling Coordinator Agreement, and Utility Distribution Company Operating Agreement, all of which enable PG&E to satisfy the obligations of operating within the CAISO's Balancing Authority Area; and 2.5 Whereas, NCPA is a public agency engaged in the generation and transmission of electric power and energy and was created by a joint powers agreement first dated July 19, 1968, and as amended and restated January 1, 2008, entered pursuant to Chapter 5, Division 7, Title 1 of the California Government Code commencing with Section 6500; and 2.6 Whereas, the NCPA Member Customers are members of NCPA, and NCPA or other duly authorized entity acts as Scheduling Coordinator on their behalf; and 2.7 Whereas, NCPA has entered into certain agreements with the CAISO including, but not limited to, the Third Amended and Restated NCPA MSS Aggregator Agreement, as amended (NCPA MSS Agreement), and Scheduling Coordinator Agreement, and will have electric power delivered to or from it at each Point of Interconnection using transmission service available to it; and 2.8 Whereas, the NCPA Member Customers have individually or collectively entered into certain agreements with the CAISO including, but not limited to, the NCPA MSS Agreement and the Operating Agreement, and will have electric power delivered to or from each of their respective Points of Interconnection using transmission service available to it; and 2.9 Whereas, the relationships and obligations among NCPA and the NCPA Member Customers are determined under existing contracts and agreements among them, which this Agreement is not intended to alter; and 2.10 Whereas, this Agreement is intended to provide for the terms and conditions of interconnections between the Electric Systems of PG&E and the NCPA Parties and to replace the existing Interconnection Agreement made effective on July 12, 2002 ("Prior Agreement"), between them; and 2.11 Whereas, the Parties intend to replace the Existing Special Facilities Agreements that have been part of the Prior Agreement, and that provide for the interconnection of the 7 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. existing generator units of the NCPA Parties with Large Generator Interconnection Agreements and Small Generator Interconnection Agreements, as applicable, among NCPA, PG&E and the CAISO; and 2.12 Whereas the Parties do not intend to change the underlying rights and responsibilities of the parties to the Special Facilities Agreements by transitioning to the new format of the Large Generator Interconnection Agreements and Small Generator Interconnection Agreements, or to impose additional requirements or obligations on existing NCPA generators; and 2.13 Whereas, the Parties agree to operate their respective Electric Systems in accordance with Good Utility Practice consistent with the requirements of this Agreement; and 2.14 Whereas, the Parties intend to cooperate in the operation of their respective Electric Systems to maximize their mutual benefits under this Agreement. 3 AGREEMENT NOW, therefore, in consideration of the mutual covenants herein set forth, the Parties agree as follows: 4 DEFINITIONS 4.1 Use of Terms As used in this Agreement (including the Recitals hereto), unless in any such case the context requires otherwise: The terms "herein," "hereto," "herewith" and "hereof' are references to this Agreement taken as a whole and not to any particular provision; the term "include," "includes" or "including" shall mean "including, for example and without limitation;" and references to a "Section," "subsection," "clause," "Appendix", "Schedule", or "Exhibit" shall mean a Section, subsection, clause, Appendix, Schedule or Exhibit of this Agreement, as the case may be. Unless otherwise specified in the Agreement, all references to a given agreement, instrument, tariff or other document, or law, regulation or ordinance shall be a reference to that agreement, instrument, tariff or other document, or law, regulation or ordinance as such now exists, including any amendment or modification made hereafter. A reference to a "person" PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. includes any individual, partnership, firm, company, corporation, joint venture, trust, association, organization or other entity, in each case whether or not having a separate legal personality and includes its successors and permitted assigns. A reference to a "day" shall mean a calendar day The following terms, when used in this Agreement with the initial letters capitalized, other than proper names, whether in the singular, plural or possessive, shall have the meanings indicated below. Capitalized terms not defined below shall have the meaning indicated in the Master Definitions Supplement included as Appendix A to the CAISO Tariff, provided, however, if a term as defined in this Agreement conflicts with the CAISO Tariff, the definition in this Agreement shall prevail. 4.1.1 Adverse Impact An effect on a Party's Electric System resulting from a Modification, New Facility Addition, or Long -Term Change to Operations to another Party's Electric System that (1) materially degrades reliability of the affected Party's Electric System or (2) materially reduces the ability of the affected Party's Electric System to physically transfer power into, out of, or within said Electric System. 4.1.2 Agreement This Interconnection Agreement among the Parties and its Appendices, as it may be amended. 4.1.3 Applicable Requirements Any applicable law or regulation; and any standards, procedures or requirements of an entity with lawful authority to control or govern, including planning, the applicable transmission system (whether in full or in part) or the Balancing Authority Area in which a Party's Electric System is located, including but not limited to FERC, NERC, WECC, Peak Reliability, and a Balancing Authority. 6 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 4.1.4 Balancing Authority Area Arrangements Arrangements, which may include, but is not limited to, an MSS or MSS Aggregator Agreement, between a Party and its Balancing Authority, or, if a Party is its own Balancing Authority, between a Party and WECC, in which the Party agrees to self -provide or procure the necessary resources and services and perform operations to meet Balancing Authority Area operating requirements and Applicable Requirements to maintain the operating reliability and integrity of the Balancing Authority Area's Electric System(s) in an economic manner consistent with Good Utility Practice. 4.1.5 Control Center An Electric System's designated operations manager responsible for, among other things, its Electric System switching operations. 4.1.6 Cost All just, reasonable, necessary and prudently incurred expenses or capital expenditures, including but not limited to those for operation, maintenance, engineering and facilities studies, Adverse Impact identification, Adverse Impact mitigation, contract modification, administrative and general expenses, taxes, depreciation, and fees for consultants, as determined in accordance with the FERC Uniform System of Accounts as such may be amended or superseded from time to time, and capital costs. 4.1.7 CPUC The California Public Utilities Commission or its regulatory successor. 4.1.8 Direct Assignment Facilities Facilities or portions of facilities that are owned by PG&E and which are necessary to physically and electrically interconnect the NCPA Parties to the CAISO Controlled Grid at the Points of Interconnection. All Direct Assignment Facilities that are contemplated by the Parties as of the Effective Date of this Interconnection Agreement are identified in the accompanying 10 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Transmission Facilities Agreements attached to and made part of this Agreement. Direct Assignment Facilities shall be subject to FERC approval. 4.1.9 Effective Date The date specified as the Effective Date of this Agreement in Section 5.2 hereof. 4.1.10 Electric System All properties and other assets, now or hereafter existing, which are leased to, licensed to, owned by, or controlled by a single person or entity, that are located within or interconnected to that person or entity's service area, and are used for or directly associated with the generation, transmission, transformation, distribution, purchase or sale of electric power, including all additions, extensions, expansions, and improvements thereto. To the extent a person or entity is not the sole owner of an asset or property, only that person's or that entity's ownership interest in such asset or property shall be considered to be part of its Electric System. 4.1.11 Engineering and Operating (E & O) Committee A joint committee of the Parties established pursuant to Section 9.8. 4.1.12 Existing Contracts The contracts between the Parties in existence on April 1, 1998 (including any contracts entered into pursuant to such contracts) as may be amended in accordance with their terms or by agreement between the parties thereto from time to time or by order or requirement of FERC or any court having jurisdiction, provided that any contract shall cease to be an Existing Contract when its initially specified term ends, unless extended by agreement of the parties thereto, or when it may be earlier terminated; and contracts between PG&E and the Western Area Power Administration, and contracts between or tariffs involving PG&E and the Transmission Agency of Northern California, in which NCPA has a beneficial interest. 4.1.13 Facility Study An engineering study to determine required Electric System modifications to accommodate a new Point of Interconnection or a modification of an existing Point of 11 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Interconnection, including the Cost and scheduled completion date for such modifications that will be required to provide needed services. 4.1.14 Interconnection Capacity The rated maximum capability of Interconnection Facilities for power transfers at Points of Interconnection. 4.1.15 Interconnection Facilities Electric facilities that establish or modify Points of Interconnection where PG&E's Electric System is connected to the Electric System of the NCPA Parties, or a Third Party. Interconnection Facilities may include, but are not limited to, transmission lines, towers and supports, switching stations, buses, breakers, switches, relays, transducers, transformers, meters, protective equipment, communications and telemetry devices, and land and land rights associated with the Interconnection Facilities at each Point of Interconnection. 4.1.16 Long -Term Change to Operations An action intentionally taken, or an event permitted by a Party, that materially alters or modifies, on a long-term or permanent basis, the configuration or other operational characteristics of its Electric System. An action or event shall be deemed to have been taken, or to have occurred on a long-term basis if the action or event remains in effect for a period of more than 30 consecutive days or occurred on more than 60 days within any period of twelve (12) consecutive months. The following are examples of actions and events that qualify as a Long - Term Change to Operations when taken or occurring on a long-term basis, though this list is not exclusive: (a) materially modifying a Remedial Action Scheme (RAS) or Special Protection Scheme (SPS), or disarming a RAS or SPS contrary to the manner and conditions for which it is designed to operate; (b) opening switches that are generally kept closed under normal operating conditions, except in those cases where a modified switching configuration has 12 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. been studied and agreed to by the affected Parties in accordance with Applicable Requirements; (c) closing switches that are generally kept open under normal operating conditions, except in those cases where a modified switching configuration has been studied and agreed to by the affected Parties in accordance with Applicable Requirements; (d) material changes to ratings or operating limits of any element of a Party's Electric System; (e) disabling or materially changing the operation of a phase -shifting transformer; (f) an increase in a Party's peak electric load on a Party's Electric System within a rolling twelve (12) month period that constitutes a ten (10) percent or greater increase over the Party's peak electric load from the prior twelve (12) month period; (g) the planned shutdown of a generation facility with a generating capacity greater than 500 kW within any Party's Electric System, other than for routine maintenance; or (h) actions or events similar in nature and/or effect to the foregoing. A Long -Term Change to Operations as defined does not include (i) outages taken for maintenance or System Emergencies in accordance with Good Utility Practice; or (ii) actions taken during maintenance or to perform maintenance or respond to System Emergencies or (iii) actions taken by a Third Party, including the CAISO, that are beyond the control of the Parties. 4.1.17 Modification The removal of or alteration or physical change to any element of a Party's Electric System. 13 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 4.1.18 New Facility Addition The addition of a new transmission facility or the addition of a new generation facility directly connected to a Party's Electric System, whether owned by that Party or not. 4.1.19 PG&E Transmission Owner Tariff (PG&E TO Tariff) PG&E Transmission Owner Tariff on file with FERC as PG&E FERC Electric Tariff Volume 5, as it may be modified or superseded from time to time. 4.1.20 PG&E Wholesale Distribution Tariff (PG&E WD Tariff) PG&E Wholesale Distribution Tariff on file with the FERC as original PG&E FERC Electric Tariff Volume No. 4, as it may be modified or superseded from time to time. 4.1.21 Point(s) Of Interconnection The physical connections of PG&E's transmission or distribution lines with NCPA or an NCPA Member Customer's Electric System as specified in Appendix A hereto, as that Appendix may be modified from time to time. 4.1.22 Operating Agreement The Operating Agreement between Pacific Gas and Electric Company, Plumas-Sierra Rural Electric Cooperative, Northern California Power Agency and Sierra Pacific Power Company dated as of December 14, 2006, which describes and establishes the mutual responsibilities for operation of the interconnection points between PG&E and Plumas-Sierra Rural Electric Cooperation and Sierra Pacific Power Company and Plumas-Sierra Rural Electric Cooperation. 4.1.23 Remote Telemetry Unit (RTU) A device that relays real-time information, including but not limited to kW, kVar, voltage, and breaker status, to a Party's Control Center or other designated recipient, to be used for monitoring purposes. 14 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 4.1.24 Responsible Meter Party A Party having the responsibility for providing, installing, owning, operating, testing, servicing and maintaining meters and associated recording or telemetering equipment at each Point of Interconnection. Unless otherwise specified herein, NCPA and/or the applicable NCPA Member Customer who owns the meter or equipment in question shall be the Responsible Meter Party under this Agreement. 4.1.25 Service Area That area within the geographic boundaries of the areas electrically served at retail, now or in the future, by the Parties. 4.1.26 System Impact Study An engineering study conducted by or in coordination with PG&E at a NCPA Party's request to determine System Reinforcements required on PG&E's Electric System necessary to establish or modify a Point of Interconnection or to address a Significant Operational Change pursuant to Section 10. 4.1.27 System Reinforcements Reinforcements to PG&E's Electric System, including but not limited to those identified by a System Impact Study, necessary to establish or maintain the Transfer Capability to a Point of Interconnection. System Reinforcements may be required when a Point of Interconnection is added or modified, when a Significant Operational Change pursuant to Section 10 is proposed, or when necessary to serve electric load reliably, or required by Good Utility Practice. System Reinforcements are limited to facilities required on PG&E's Electric System and ordinarily would not include Interconnection Facilities required at the Point of Interconnection. 4.1.28 Third Party A person or entity that is not a Party to this Agreement. 15 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 4.1.29 Transfer Capability The measure of the capability of interconnected Electric Systems to move or transfer power in a reliable manner from one point to another over all transmission lines between those points under specified system conditions. 4.1.30 Transmission Arrangement An agreement or tariff, either the CAISO Tariff or a separate contract or tariff which enables NCPA to deliver power and energy to meet its electric power requirements. 4.1.31 Transmission Operations Center PG&E's Control Center from which it directs operations of its transmission system. 4.1.32 Transmission Facilities Agreement An agreement made between one or more Parties for services, including, but not limited to, the design and installation of new facilities. 4.1.33 Uncontrollable Force Any act of God, labor disturbance, act of the public enemy, war, insurrection, riot, fire, storm, flood, earthquake, explosion, any curtailment, order, regulation or restriction imposed by governmental, military or lawfully established civilian authorities or any other cause beyond the reasonable control of PG&E or the NCPA Parties which could not be avoided through the exercise of Good Utility Practice. 4.1.34 Upgrade Facility A new or upgraded Interconnection Facility and/or System Reinforcement constructed or installed pursuant to this Agreement. 16 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 5 SCOPE 5.1 Interconnected Operations Service Agreement No. This Agreement governs the interconnected and coordinated operation of PG&E's Electric System, a portion of which has been turned over to the operational control of the CAISO, and the NCPA Parties' Electric Systems. As of the Effective Date of this Agreement, the CAISO operates the Balancing Authority Area in which the Parties operate their respective Electric Systems. The Parties agree that, during the term of this Agreement and unless otherwise provided for by amendment of this Agreement, that portion or those portions of the Parties' Electric Systems that are interconnected shall be operated in parallel pursuant to the terms and conditions of this Agreement and their respective Balancing Authority Area Arrangements. Each Party shall at all times to the maximum extent practicable avoid causing any Adverse Impact on another Party's Electric System. 5.2 Effective Date The term "Effective Date" as used in this Agreement shall mean 0000 hours of July 1, 2015, or the date on which FERC accepts this Agreement for filing and permits it to be placed into effect without material change or material new conditions unacceptable to any Party, whichever is later. If FERC sets this Agreement for hearing to determine whether it is just and reasonable and otherwise lawful, then this Agreement shall become effective on the date it is permitted to be placed into effect and subject to any conditions imposed by FERC. The ordering of such a hearing in and of itself shall not be considered a material change. However, in the event FERC makes any material change or imposes a material new condition unacceptable to any Party, the Parties shall promptly enter into good faith negotiations in an attempt to achieve a mutually agreeable modification to this Agreement to address any such material change or material new condition. The Parties agree to work diligently to obtain timely acceptance of this Agreement and all of its provisions by FERC, and agree that the NCPA Parties shall be entitled to prior review of PG&E's initial filing with FERC seeking acceptance of this Agreement for filing. 17 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 5.3 Termination Service Agreement No. This Agreement shall terminate on the earliest of. (i) the occurrence of the fifth anniversary of the Effective Date or the tenth anniversary of the Effective Date if the Parties have agreed to such five-year extension by no later than the fourth anniversary of the Effective Date, where NCPA is authorized by the NCPA Member Customers to act on their behalf regarding such five-year extension; or (ii) the end of the 12th month following the date on which a Party gives the other Parties written notice that this Agreement shall be terminated, which notice shall not be given prior to the fourth anniversary of the Effective Date; or (iii) as provided in Section 10, 15, or 21. Notwithstanding the provisions of Section 5.3, if an NCPA Member Customer provides written notice to the other Parties to terminate the Agreement on the end of the 12th month following the date on which the NCPA Member Customer provides such written notice, the Agreement shall remain in full force and effect as to the remaining Parties. In addition, PG&E may give notice of termination to one NCPA Member Customer without terminating the agreement as to NCPA or any other NCPA Member Customers. 6 INTERCONNECTIONS Transfer of electric power between the Electric Systems of PG&E and the NCPA Parties shall occur at the Point(s) of Interconnection identified in Appendix A. 6.1 Interconnection Capacity Interconnection Capacity is determined by engineering studies that consider the physical rating of all equipment installed within the Interconnection Facilities at the Points of Interconnection. The E&O Committee shall periodically review the Interconnection Capacity to ensure that it is sufficiently maintained throughout the term of this Agreement. Unless otherwise agreed by the E&O Committee, any required engineering studies shall be performed by PG&E and the NCPA Parties or an engineering professional acting on behalf of the NCPA Parties, and reviewed with the E&O Committee. The Parties shall cooperate by providing any information necessary for such studies. a PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 6.2 Establishing or Modifying Point(s) of Interconnection Whenever NCPA or an NCPA Member Customer decides to add or modify a Point of Interconnection at transmission voltage, 60 kV or more, it shall so notify the CAISO, in accordance with the CAISO Tariff, and PG&E, in accordance with the PG&E TO Tariff. Upon PG&E's receipt of such notice, the Parties shall follow the procedures described in Sections 8 through 10 of the PG&E TO Tariff. Regarding disputes that might arise under this Section 6, if the PG&E TO Tariff conflicts with Section 22 of this Agreement, the PG&E TO Tariff shall govern. If NCPA or an NCPA Member Customer decides to either modify or add a Point of Interconnection at distribution voltage, less than 60 kV, it shall so notify PG&E in accordance with the requirements of the PG&E WD Tariff. Upon PG&E's receipt of such notification, PG&E shall follow the applicable procedures and requirements of the PG&E WD Tariff to determine what Upgrade Facilities, if any, shall be required. Upgrade Facilities required for the addition or modification of a Point of Interconnection at distribution voltage shall be accomplished pursuant to the requirements of the PG&E WD Tariff. Regarding disputes that might arise under this Section 6 as related to service under PG&E WD Tariff, if the PG&E WD Tariff conflicts with Section 22 of this Agreement, the PG&E WD Tariff shall govern. 6.3 New Interconnection Facilities and Upgrades If Upgrade Facilities are needed as a result of a NCPA or NCPA Member Customer notice to add or modify a Point of Interconnection pursuant to this Section 6, then PG&E, NCPA, and, if applicable the Member Customer issuing the notice shall meet and confer on a mutually acceptable plan to complete the Upgrade Facilities. The Cost responsibility for Upgrade Facilities required as a result of NCPA's or an NCPA Member Customer's notice to add or modify a Point of Interconnection shall be determined based on the provisions of Section 8.1.2 of the PG&E TO Tariff or Section 15 of the PG&E WD Tariff, as applicable, and Appendix C of this Agreement. Any dispute regarding the actual capability of the existing transmission, distribution, or Interconnection Facilities, or the need for Upgrade Facilities, that will support the new or upgraded Point of Interconnection, or how the Cost responsibility for the necessary Upgrade QI PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Facilities should be allocated, shall be resolved through the dispute resolution procedures as set forth in Section 22. 6.4 Construction Plan and Agreement Unless otherwise provided under the PG&E TO or WD Tariffs, or otherwise agreed to by the Parties, within thirty (30) calendar days after completion of a Facility Study as provided in the PG&E TO Tariff, NCPA or an NCPA Member Customer shall notify PG&E if it intends to proceed with the Upgrade Facility. PG&E, NCPA, and, if applicable, the notifying NCPA Member Customer shall then meet and confer on a mutually acceptable plan to complete the Upgrade Facility. If the conferring Parties reach agreement on a plan for construction or installation of an Upgrade Facility, including responsibility for payment of the applicable Cost, those Parties shall enter into a separate agreement pursuant to Appendix C. If the conferring Parties fail to reach such agreement, the matter should be resolved through the dispute resolution provisions in Section 22. 6.5 Test Period for Interconnection The Parties shall cooperate in the testing of the Point(s) of Interconnection and of the Parties' Interconnection Facilities before they go into operation. 7 BALANCING AUTHORITY AREA ARRANGEMENTS All transmission, distribution and generation facilities within a Party's Electric System shall at all times during the term of this Agreement be within a Balancing Authority Area and operated in accordance with Balancing Authority Area Arrangements. After a Party has had a reasonable opportunity to obtain or re-establish operation in a Balancing Authority Area or make the necessary Balancing Authority Area Arrangements, failure by a Party to operate in a Balancing Authority Area and to operate its Electric System in accordance with, and to maintain in effect, Balancing Authority Area Arrangements, shall be deemed a material breach of this Agreement and just cause for termination and disconnection of the Agreement as to such Party. If any Party operates without being located in an established Balancing Authority Area or without Balancing Authority Area Arrangements in effect, that Party shall fully indemnify and 20 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 make whole the other Parties for any penalties, fees or costs imposed or other damages caused to those Parties. Each Party shall act as its own Scheduling Coordinator or employ a Scheduling Coordinator to act for it. No Party shall have any obligation under this Agreement to serve as Scheduling Coordinator for another Party or take on any other role in which it acts on behalf of another Party as to its Party's transactions. PG&E has and will have in effect various existing agreements with the Balancing Authority in which its Electric System is located. These agreements include, but are not limited to, the Transmission Control Agreement, the Transmission Owner Tariff, Scheduling Coordinator Agreements, Operating Agreement, and Utility Distribution Company Operating Agreement, all of which enable PG&E to satisfy the obligations of operating within the CAISO's Balancing Authority Area. This Agreement is subject to PG&E's obligations and responsibilities under those agreements, and in the event of any inconsistency between those agreements and this Agreement, the former shall control. NCPA and the NCPA Member Customers have and will have in effect various existing agreements with the Balancing Authority in which their Electric Systems are located. These agreements include, but are not limited to, the Scheduling Coordinator Agreement and NCPA MSS Agreement with the CAISO, the Operating Agreement, and such agreements qualified as Balancing Authority Area Arrangement that may be needed by the CAISO for operation of the Balancing Authority Area. This Agreement is subject to the NCPA Party's obligations and responsibilities under those agreements, and in the event of any inconsistency between those agreements and this Agreement, the former shall control. 8 SYSTEM PLANNING COORDINATION Pursuant to the CAISO Tariff and Section 8 of this Agreement, PG&E conducts planning studies of its Electric System annually, including the reasonable use of information provided to PG&E pursuant to this Agreement, to identify System Reinforcements or other Modifications of its Electric System necessary to determine the Transfer Capability to reliably serve the expected loads connected to its Electric System, including expected NCPA and NCPA Member Customer loads at Point(s) of Interconnection. 21 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 8.1 Planning Process In order for PG&E to include the effects of growth of the NCPA Parties' Electric System loads in its planning studies, each NCPA Party shall provide PG&E with their respective electric load planning forecast by October 1 of each year. Each NCPA Party shall also provide PG&E with certain network modeling data as required pursuant to Applicable Requirements, including NERC Standards MOD -010 and MOD -12, as such may be revised from time to time. Such electric load planning forecast shall contain the best estimate of its gross Electric System load (actual MW and MWh as measured at the Point of Interconnection plus generation resources internal to the Electric System) and net Electric System load (actual MW and MWh as measured at the Point of Interconnection) for the next five-year period. The initial forecast shall be submitted to PG&E within 30 days of the Effective Date. Both PG&E and the applicable NCPA Party or Parties shall be responsible for participating in planning for the construction of any necessary System Reinforcements as provided in the PG&E TO Tariff Sections 8 through 10. If PG&E disagrees with the electric load planning forecast provided by a NCPA Party, PG&E shall coordinate with NCPA and the impacted NCPA Member Customer, and if necessary, either Party may request that an E&O Committee meeting be scheduled pursuant to Section 9.8.1 to review and discuss PG&E's disagreement with the electric load planning forecast. Nothing in Section 8 prevents PG&E from using, relying on, or incorporating alternative forecasts in planning studies. 8.2 System Reinforcements If, as a result of its annual planning review process, PG&E determines, through studies conducted pursuant to the CAISO Tariff, including Section 4.8.1 thereof, and in accordance with PG&E TO Tariff Section 9, that a need exists to construct System Reinforcements that will have a direct effect on NCPA or an NCPA Member Customer, PG&E shall inform NCPA and, if applicable, the affected NCPA Member Customer through a notice pursuant to Section 31. Those Parties shall then follow the applicable procedures of the PG&E TO Tariff Sections 8 through 10. 22 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 9 OPERATING PROVISIONS Service Agreement No. 9.1 Good Utility Practice and Applicable Requirements Obligation Each Party shall operate pursuant to this Agreement in accordance with Good Utility Practice and in compliance with Applicable Requirements of federal, state, and local laws, licenses, and permits. Each Party shall plan and operate its respective Electric System in accordance with Good Utility Practice and endeavor to minimize electrical disturbances on the Electric System of the other Party. No Party shall be obligated to operate in a manner contrary to Good Utility Practice. When satisfying its obligations pursuant to this Agreement, a Party shall in good faith, take all reasonable actions required to satisfy its obligations in accordance with Good Utility Practice and Applicable Requirements to timely avoid or mitigate Adverse Impacts to another Party's Electric System. 9.2 General The Parties agree to coordinate the operations of their respective Electric Systems so as to avoid or minimize any Adverse Impacts to another Party's Electric System in accordance with Balancing Authority Area Arrangements. 9.3 Power Delivery and Quality Standard Power delivered is commonly designated as three-phase alternating current, at nominal 60 Hertz, and at the nominal voltage described in Appendix A for each Point of Interconnection. Voltage and frequency fluctuations under system normal operation conditions shall be permitted consistent with Good Utility Practice. Each Party shall plan, design, and operate its Electric System so as to minimize the interchange of reactive power at the Point(s) of Interconnections. 9.4 Coordination Of Operations The Parties shall at all times coordinate and communicate their planned and unplanned outages and other switching operations that may have an effect on the operations of another 23 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Party's Electric System and may reasonably be required to protect the integrity of the Balancing Authority Area during System Emergencies. PG&E, NCPA, and the NCPA Member Customers are also responsible for maintenance and switching operations of their Electric Systems. All Parties may from time to time remove various elements of their Electric Systems from operation or initiate other actions that may affect operations or transfer of energy across Point(s) of Interconnection. The Parties shall coordinate their activities in the operation and maintenance of their Electric Systems in order to avoid or minimize any adverse effects of those activities on each other. 9.5 Relationship To Balancing Authority Area Operations The Parties currently operate in the CAISO Balancing Authority Area. In the event that a Party makes any changes that significantly or materially affect its relationship with the CAISO, including, but not limited to, interconnecting its Electric System with a non-CAISO Balancing Authority Area, the Party making the change shall give a minimum of 30 days' notice to the other Parties. 9.6 Separate Balancing Authority Area Nothing in this Agreement shall prevent or limit any Party from interconnecting with, joining or forming a new Balancing Authority Area. In such event, this Agreement shall be revised as appropriate to reflect such change in Balancing Authority Area operations. 9.7 Reporting Significant Events Each Party shall promptly, after reporting to the Balancing Authority, report to the other Parties any System Emergency or other significant operating event reasonably likely to affect operation of the other Party's Electric System at each Point(s) of Interconnection. For notice to PG&E, such notice shall be by telephone to PG&E's Transmission Operations Center personnel or to a PG&E substation or switching center as may be designated by PG&E. For notice to NCPA or an NCPA Member Customer, such notice shall be by telephone to NCPA's Control Center, or as otherwise designated by NCPA or the NCPA Member Customer. Each Party, upon 24 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. request and on a case-by-case basis for reasonable cause related to operating conditions, shall, in a timely manner, provide Electric System operating information, such as loading on lines and equipment and levels of operating voltages and electric power factors. In the event of an interruption(s), including but not limited to, power quality events, of electric service at any Point of Interconnection, the Party causing the interruption shall report, in a timely manner, to the affected Party or Parties the nature and suspected cause of the event, actions being taken to restore electric service, and the estimated time until restoration of electric service. Within 30 days following the restoration of electric service to the affected Parties, the Party causing the interruption shall provide a written report to the affected Parties identifying the cause of the interruption, and what preventive actions may be taken in the future to mitigate further interruptions in electric service to the affected Parties. 9.8 Engineering And Operating Committee The Parties shall establish an Engineering and Operating (E&O) Committee. This ` E&O Committee" shall jointly develop and modify, as necessary, operating procedures and engineering planning matters required to implement this Agreement. The E&O Committee shall consist of one representative designated in writing by each Party. Each Party shall also designate an alternate who may act instead of a representative at the option of that Party, and an NCPA Member Customer may designate NCPA to act as its alternate. Any Party may at any time change its representatives or alternate on the E&O Committee and shall promptly notify the other Parties of any change in designation. Any representative, by written notice to the other Parties, may authorize its alternate to act temporarily in its place. Each member of the E&O Committee may invite other members of its organization or others, as its advisors, to attend meetings of the E&O Committee. The E&O Committee shall establish procedures for the coordination and operation of the Parties' Electric Systems, including, but not limited to, providing for the coordination of maintenance schedules and operation of the Parties' Electric Systems as may be required to maintain the reliability and power quality of the interconnected Electric Systems, minimize outages, reduce losses, maintain voltage levels, and minimize reactive interchanges. The E&O 25 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Committee shall also be responsible for examining and making recommendations to the Parties for Upgrade Facilities in order to: (i) ensure that the Point(s) of Interconnection are operated in accordance with Good Utility Practice; (ii) determine necessary additions or modifications to equipment or operating procedures to ensure that the Parties' Electric System reliability and service to its customers will not be adversely affected; (iii) determine the studies that need to be performed and the manner in which the Cost of such studies shall be allocated unless the CAISO Tariff, PG&E TO Tariff or PG&E WD Tariff provides otherwise; and (iv) make recommendations for the allocation of Costs associated with the Upgrade Facilities unless the CAISO Tariff, PG&E TO Tariff or PG&E WD Tariff provides otherwise. 9.8.1 E&O Committee Meetings Any Party may call for a meeting of the E&O Committee upon reasonable advance notice to the other Parties. A written agenda incorporating any items proposed by the requesting Party shall be exchanged in advance of such meetings to the affected Parties. The meeting shall be timely scheduled, and the affected Parties shall select a meeting date that is mutually acceptable to the Parties. Meetings may be conducted in person, by telephone or by any other agreed-upon method. Meeting minutes shall be kept to document the discussions and outcome of the meetings, and such meeting minutes are to be distributed to the Parties. 9.8.2 E&O Committee Expenses The expenses of the members of the E&O Committee, their alternates and advisors shall be borne by the Party they represent. Expenses incurred by the E&O Committee in addition to those herein above mentioned shall be shared in a just and reasonable manner agreed to by the Parties. The sharing of such expenses shall be agreed to prior to the time that such additional expenses are incurred. 26 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 9.8.3 E&O Committee Authority The E&O Committee shall have no authority to modify any of the provisions of this Agreement. All actions, recommendations and reports shall become effective when signed, or otherwise approved, by all members of the E&O Committee and if necessary, referred to the Parties' respective management. Each Party's representatives shall be afforded ample time to review relevant details prior to finalizing any action, recommendation or report and may request up to 30 days to review the material to be acted upon. 9.9 Settlement of Disputes and Arbitration The Parties agree to make best efforts to settle all disputes under this Agreement between the Parties as a matter of normal business practice under this Agreement. Any unresolved disputes shall be resolved through the dispute resolution procedure set forth in Section 22. 9.10 Protective Devices Each Party shall, consistent with CAISO requirements and Good Utility Practice, install, modify, set and adjust any required protective relaying equipment associated with facilities within its respective Electric System at their own expense. Such settings, adjustments or replacement shall be consistent with settings, adjustments or replacement made by PG&E to PG&E's protective relaying equipment. The NCPA Parties shall install, modify, set, adjust or replace protective relaying equipment located within their respective Electric Systems in the event that such is required by PG&E's Modification of PG&E's Electric System consistent with CAISO requirements. Such changes shall be reviewed by the E&O Committee, unless otherwise agreed to by the affected Parties. The Parties shall exchange relay settings and fault duty information on a routine basis as agreed upon by the Parties. 9.11 Requirements for NCPA or NCPA Member Customer Operated Generators Connected to PG&E NCPA or an NCPA Member Customer shall enter into a generator interconnection -type agreement with PG&E substantially consistent with CAISO's Generation Interconnection Agreement, consistent with NCPA's MSS Agreement, and consistent with Section 6 of this Agreement for each new generating facility operated by NCPA or an NCPA Member Customer, 27 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. which is connected to PG&E's Electric System at voltages of 60 W or greater. NCPA or an NCPA Member Customer shall enter into a generator interconnection -type agreement with PG&E substantially consistent with PG&E's Generator Interconnection Agreement under the PG&E WD Tariff, consistent with NCPA's MSS Agreement and consistent with Section 6 of this Agreement for each new generating facility operated by NCPA or an NCPA Member Customer, which is connected to PG&E's Electric System at voltages of less than 60 W. This section 9.11 does not apply to NCPA or NCPA Member Customer generating facilities not connected to PG&E's Electric System. The Parties will transition existing Special Facilities Agreements with PG&E to the appropriate Generator Interconnection Agreement, but this change is not intended to alter the rights or obligations of the Parties under the existing agreements. 9.12 Continuity Of Service 9.12.1 Operation Actions To Maintain Continuity Each Party shall take actions that are reasonable and consistent with Balancing Authority Area Arrangements as necessary to maintain continuity of service between the Parties. Such actions may include, but are not limited to, opening or closing circuit breakers or other components of the interconnections. 9.12.2 Unscheduled Interruptions A Party may temporarily interrupt or reduce any service, or temporarily separate all or any part of the facilities of its Electric System from another Party's Electric System to implement CAISO operating orders and their respective Balancing Authority Area Arrangements or Good Utility Practice at any time that: (i) a System Emergency exists, provided that if the unscheduled interruption is not undertaken pursuant to a CAISO operating order (a) such interruption, reduction of service or separation is necessary to remedy the System Emergency, and (b) the duration of such interruption, reduction of service or separation will be limited to as short a time period as reasonable under the circumstances; (ii) the action is necessary to prevent a hazard to life or property; or (iii) the operation of the Party's Electric System is suspended, interrupted or interfered with as a result of an Uncontrollable Force. Reasonable effort shall be made to 28 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 coordinate any such interruption and such interruption will be immediately communicated to the affected Party. In the event of such interruption or reduction in service, the Parties shall restore full service on a basis comparable to the restoration of other public service and safety facilities and consistent with their respective Balancing Authority Area Arrangements. 9.12.3 Scheduled Interruptions All scheduled interruptions of service shall be made as mutually agreed to by the Parties and in accordance with Balancing Authority Area Arrangements and Good Utility Practice. The Parties shall provide a minimum of 72 hours advance notice of any such interruption, reduction or separation, and its estimated duration. 9.12.4 Interruption By Protective Devices The Parties utilize automatic protective devices in order to assist in maintaining the integrity and reliability of their respective Electric Systems and to protect their customers from damage, injury or prolonged outages. Service on the Parties' Electric Systems is subject to interruption in the event of operation of such devices. In the event of such interruption, service will be restored consistent with Good Utility Practice and Balancing Authority Area Arrangements. In addition, the Parties shall coordinate such restoration and all installations, upgrades, and replacements of protective devices at Point(s) of Interconnection. 9.12.5 Jeopardy If at any time continuity of service within the CAISO Balancing Authority Area is being jeopardized due to failure of facilities, the Parties shall coordinate their responses to the situation in order to implement CAISO operating orders in accordance with their respective Balancing Authority Area Arrangements, Good Utility Practice, and any relevant standard promulgated by NERC or another body authorized to promulgate such standards. Such coordination may include the reduction of load; provided, except as otherwise set forth in the Parties' Balancing Authority Area Arrangements, such reduction shall maintain, as far as may be practicable, the relative sizes of load served by each Party in the same proportion as existed before such reduction so that no one Party is required to reduce its load disproportionately. al PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. Any Party may also temporarily interrupt or reduce deliveries to Points of Interconnection or separate all or a part of the facilities of its Electric System from all or a part of the Electric System of another Party, or the Electric System that directly or indirectly serves another Party, if the first Party determines that the following conditions exist or that the described action is necessary: (i) a System Emergency; (ii) in order to install equipment on, make repairs or replacements to, make investigations and inspections of, or perform maintenance or other work on a Party's Electric System; (iii) to prevent a hazard to life or property; (iv) as necessitated by Good Utility Practice; or (v) where the operation of a Party's Electric System is suspended, interrupted or interfered with as a result of Uncontrollable Force. The Parties understand and agree that load curtailment under such circumstances should be coordinated among PG&E, NCPA, the relevant NCPA Member Customer(s) and the CAISO based upon the CAISO Tariff and any Balancing Authority Area Arrangements entered into between the Parties and the CAISO. The Parties shall endeavor to provide notice to the affected Party prior to such interruptions or reductions of deliveries, and such interruptions or reductions of deliveries shall be minimized and implemented after all other practical remedies have been exhausted. 9.13 Operating Records Each Party shall maintain operating records in accordance with Good Utility Practice. Each Party shall have reasonable access to such operating records kept by another Party which reasonably relate to interconnected operation of the Parties' Electric Systems; provided, that if requested to do so by the other Party, a Party requesting such records shall be required to keep such records confidential pursuant to Section 9.14. Such records shall include, but not be limited to, operating logs, scheduled transfers through each Point of Interconnection, line loadings, outage and power quality reports, voltages and reactive power. 9.14 Confidentiality The Parties anticipate that during the course of the Parties' relationship under this Agreement, they will at times supply copies of confidential or proprietary information to each other, including information that should be kept confidential from and not disclosed to certain departments within a Party (e.g., transmission planning information that cannot be disclosed to marketing personnel) or to Third Parties, including the public. If PG&E supplies confidential 30 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. information to NCPA and/or one or more NCPA Member Customers, or NCPA or one or more NCPA Member Customer supplies confidential information to PG&E, it is the responsibility of the supplying Party to inform the receiving Party that such information is confidential and to label or otherwise mark each confidential document or electronic file "CONFIDENTIAL". It shall be the responsibility and obligation of the receiving Party to maintain the confidentiality of such information in accordance with the supplying Party's reasonable instructions, and to not disclose information designated confidential to any Third Party or entity to whom disclosure is prohibited under applicable regulations (e.g., the FERC Standards of Conduct), unless required to do so by law. If a Party ("Receiving Party") receives a request from a Third Party, whether under the California Public Records Act, California Government Code Sections 6250-6270, as amended, or otherwise, for access to, or inspection, disclosure or copying of, any of the other Party's (the "Supplying Party") confidential data or information ("Disclosure Request"), then the Receiving Party shall provide notice to and a copy of the Disclosure Request to the Supplying Party within three (3) business days of receipt of the Disclosure Request. Within three (3) business days of receipt of such notice, the Supplying Party shall provide notice to the Receiving Party either: (a) that the Supplying Party believes there are reasonable legal grounds for denying or objecting to the Disclosure Request, and the Supplying Party requests the Receiving Party to deny or object to the Disclosure Request with respect to identified confidential information. In such case, the Supplying Party will either defend the denial of the Disclosure Request at its sole Cost (with reasonable assistance by the Receiving Party), or it shall indemnify the Receiving Party for all Costs associated with denying or objecting to the Disclosure Request. Such indemnification by the Supplying Party of the Receiving Party shall include all of the Receiving Party's Costs reasonably incurred with respect to denial of or objection to the Disclosure Request, including but not limited to Costs, penalties, and the Receiving Party's attorneys' fees; or 31 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 (b) that the Supplying Party shall agree that the Receiving Party may grant the Disclosure Request without any liability by the Receiving Party to the Supplying Party. 10 SIGNIFICANT REGULATORY OR OPERATIONAL CHANGE The procedures set forth in this Section 10 shall apply in the event of a Significant Regulatory Change or a Significant Operational Change as described below. 10.1 Significant Regulatory Change A "Significant Regulatory Change," as this term is used in this Section 10, shall be deemed to occur if FERC, the CPUC, the CAISO or any other court, public authority, governmental, or other lawfully established civilian authorities having jurisdiction, issues an order or decision or adopts or modifies a tariff or filed contract, or enacts a law that materially interferes with the ability of any Party to perform any of its obligations under this Agreement. 10.2 Significant Operational Change A "Significant Operational Change," as this term is used in this Section 10, shall consist of any of the following: (i) a Party making a new interconnection of its Electric System with the Electric System of a Third Party, including any generation, that would have an Adverse Impact on the operation of another Party's Electric System; (ii) installation, operation, termination, or expansion by a Party or a Third Party of a generation facility within any Party's Electric System where power or energy from such generation is intended to or may possibly flow through a Point of Interconnection and create an Adverse Impact on another Party's Electric System; (iii) a Long -Term Change to Operations; (iv) any other operational change proposed by a Party that could reasonably be expected to create an Adverse Impact on another Party's Electric System; (v) material amendments and/or revisions to any tariffs, contracts or other applicable documents referenced in this Agreement that directly affect a Party's obligations under this Agreement, including, but not limited to, the CAISO Tariff, PG&E's TO Tariff or PG&E's WD Tariff, or (vi) an action taken by the Balancing Authority that may have a material detrimental impact on the way a Party operates or must operate its Electric System or the Points of Interconnection between the Parties. 32 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 10.3 Change in Functions or Scope The Parties recognize that there may be a change in the functions performed by the CAISO or in the scope of the facilities under the operational control of the CAISO, or the replacement of the CAISO with a Regional Transmission Organization that may perform different functions or have a different scope than the CAISO as of the Effective Date. Such a change shall not be deemed to be a Significant Regulatory Change unless the conditions described in Section 10.1 and 10.2 of this Agreement are satisfied. Any transfer from PG&E to the CAISO of any functions contemplated in this Agreement can be a Significant Regulatory Change if the conditions described in Section 10.1 and 10.2 of this Agreement are satisfied. 10.4 Notification of Significant Regulatory or Operational Change At any time during the term of this Agreement, if any Party anticipates the occurrence of a Significant Regulatory Change that may reasonably be expected to create an Adverse Impact on any Parties' obligations or operations under this Agreement or Significant Operational Change, such Party shall provide written notice to the affected Parties as soon as practicable. The notice shall contain a description of the change, including expected time schedules, and of the effect of the significant change to the affected Party's Electric System. If the Party giving notice believes that it will be necessary to amend this Agreement to address the anticipated change, then the notice to the other Party may include a proposal that the Parties meet to negotiate an appropriate amendment to this Agreement. The Parties shall promptly enter into good faith negotiations and attempt to achieve a mutually agreeable modification to this Agreement to address any such significant change. If a Party is uncertain as to whether a proposed change might be Significant or might create an Adverse Impact, or if it wishes to have certainty under Section 10.8 before proceeding, the Party should also give notice to the potentially Affected Party as soon as practicable. Notwithstanding the foregoing, where the potential Significant Operational Change is studied in or is the result of the CAISO generator interconnection process ("CAISO Generator Change"), a Party is not obligated to give notice under this Section 10.4, provided that the other Parties are notified in writing of the CAISO Generator Change in accordance with the CAISO Tariff in reasonable time to allow the other Parties the opportunity to express concerns and to provide information to the study conducted in accordance with the CAISO generator interconnection planning process. 33 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 10.5 Amendment of Agreement If the Parties agree that an amendment to this Agreement is necessary to address a Significant Regulatory Change or a Significant Operational Change, the Parties will proceed to negotiate such amendment. If the Parties have not reached agreement within 60 calendar days of the date of the first meeting, any unresolved issues may be submitted for resolution through the dispute resolution procedures set forth in Section 22; provided that all Parties agree to such procedures. After the 60 -day period stated above, any Party may, but is not required to, unilaterally initiate an appropriate proceeding respecting this Agreement with FERC pursuant to Sections 205 or 206 of the FPA, which proceeding could include a request for termination of this Agreement, and another Party may exercise its rights under the FPA to protest or oppose such filing. In the event of filing for termination, PG&E shall make an appropriate regulatory filing of a replacement agreement such that the replacement agreement is effective contemporaneously with the termination date of this Agreement. 10.6 Studies of Significant Operational Change The Party receiving notice of a Significant Operational Change will respond to the Party submitting such notice within 30 days. If the Party receiving such notice believes that there will be no Adverse Impact resulting from the Significant Operational Change, it shall so state. If the Party receiving notice of a Significant Operational Change believes that the proposed change may reasonably be expected to have an Adverse Impact on the operation of its Electric System, it may request a study of any such Significant Operational Change to determine the potential for any Adverse Impacts and any potential avoidance or mitigation measures thereto. The affected Parties shall cooperate in determining the scope of the study and how the study should be conducted, and shall cooperate to provide information necessary to conduct such a study in a timely manner. NCPA may, at its sole discretion, act on behalf of a NCPA Member Customer and participate in determining the scope of the study and how the study should be conducted if NCPA is not an affected Party. To the extent studies are required, those studies will be performed in a reasonable period of time. If it is determined, based on the results of the study, that, in addition, a Facility Study or System Impact Study is required, such study shall be performed within the time and in the 34 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. manner specified in Section 10 of the PG&E TO Tariff and as agreed by the Parties. All study Costs associated with a proposal shall be the responsibility of the Party whose proposal or actions will cause the Significant Operational Change, or will be split into two equal shares by (1) PG&E and (2) the NCPA Parties if the CAISO is the entity that causes or will cause the change; provided, that such Costs may be paid by a responsible Third Party and that NCPA Parties shall be responsible for dividing their share of such Costs among themselves. Any disputes over the necessity of particular studies or the Cost of such studies shall be resolved through the dispute resolution procedures set forth in Section 22 unless the dispute resolution procedures of the PG&E TO Tariff or the PG&E WD Tariff apply. Upon completion of necessary studies, the Parties will each review the study results and discuss any recommendations for avoidance and/or mitigation of Adverse Impacts. 10.7 Mitigation And Costs Unless otherwise agreed by the Parties, the Party whose proposal or action causes the Significant Operational Change ("Modifying Party") shall be responsible for avoiding or fully mitigating an Adverse Impact to the Electric System of an affected Party ("Affected Party"), and to the extent Adverse Impacts cannot be avoided or fully mitigated, fully compensating the Affected Party for all Costs incurred pursuant to the Adverse Impact; provided, that such Costs may be paid by a responsible Third Party. Any reasonable Cost incurred by the Affected Party in its cooperation with the Modifying Party shall be reimbursed by the Modifying Party. All avoidance or mitigation measures shall be completed before the Significant Operational Change is made. Any dispute regarding the need for, the nature of, or the Cost of mitigating Adverse Impacts or compensating the Affected Party for those Adverse Impacts that cannot be mitigated shall be resolved through the dispute resolution procedures set forth in Section 22. In the event changes in transmission delivery voltages, relocation of facilities serving Points of Interconnections or other changes in transmission facilities are necessary on PG&E's side of any Point of Interconnection with NCPA or an NCPA Member Customer because of changes to PG&E's transmission as a result of Good Utility Practice or CAISO planning requirements, these changes shall be made by PG&E at its expense. For similar changes made to NCPA's or an NCPA Member Customer's side of Point(s) of Interconnection, such changes shall 35 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. be at NCPA's or the NCPA Member Customer's expense unless the change is made for PG&E's benefit and at PG&E's sole discretion or as otherwise agreed. Such change made at PG&E's sole discretion shall be submitted to the E&O Committee for its determination of respective long term benefits of such changes, if any. The E&O Committee shall recommend a methodology for allocating the Cost of such changes based on the projected net long-term benefits to each Party. Changes required on PG&E's side due to any changes made for NCPA's or an NCPA Member Customer's benefit and at NCPA's or an NCPA Member Customer's sole discretion shall be made at NCPA's or the NCPA Member Customer's expense, unless submitted to the E&O Committee for its determination of an appropriate allocation between the Parties based on projected net long term benefits to each Party. Notwithstanding the provisions of this Section 10.7, the Modifying Party will not be responsible for their share of any Costs associated with the changes made under this Section that are approved by FERC, or other jurisdictional authority, for inclusion in the Affected Party's Transmission Revenue Requirement for recovery through Access Charges, as provided in Section 26 of the CAISO Tariff. Nothing in the foregoing sentence obligates or requires the Affected Party to seek recovery for any specific Costs in their Transmission Revenue Requirement. 10.8 Failure To Notify Of Significant Operational Changes Each Party has a duty to provide notice to any Affected Parties of Significant Operational Changes planned for its Electric System that could reasonably be expected to have an Adverse Impact on the Electric System of those Parties. If a Party implements a Significant Operational Change without providing such notice, the Affected Party shall have the right to open any affected Point(s) of Interconnection if, in its judgment, it is necessary to protect the integrity of its Electric System, and the right to file with FERC under Sections 205 or 206 of the FPA seeking appropriate relief, including, but not limited to, amendment or termination of this Agreement, except that the termination of this Agreement by an NCPA Member Customer will not be deemed to terminate this Agreement as to NCPA or any other NCPA Member Customer. 36 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 11 INSTALLATION AND ACCESS Where it is necessary for any Party to install any of its facilities on another Party's premises in order to accomplish the Interconnection or otherwise to perform the duties contemplated by this Agreement, the Parties hereby grant to each other, subject to any legal and regulatory requirements for any specific installation, for the term of this Agreement: i) the right to make such installation along the mutually agreed route (subject to each Party's right to protect its operations or that of its customers in its Service Area) of sufficient width to provide full legal clearance from all structures on such property; and ii) access to each Party's premises upon reasonable notice and at reasonable hours for any purposes reasonably connected with this Agreement. No Party shall be allowed or obligated to install such facilities unless and until all necessary licenses, permits, certificates, or other governmental authorizations or approvals that may be necessary are obtained and any necessary easements for the installation of facilities are granted. Electric facilities belonging to one Party that are installed on another Party's premises will be relocated only with the agreement of the owner of such facilities, which shall not be unreasonably withheld. The requesting Party shall pay the Cost, if any, of any such facility relocation. If such Costs are FERC jurisdictional, PG&E shall request and obtain FERC acceptance to assess such Costs prior to collection. 12 METERING 12.1 Delivery Meters All real and reactive power deliveries shall be metered at each Point of Interconnection with meters meeting the requirements of. (i) the CAISO Tariff for interconnections at 60 kV and above; and (ii) the PG&E WD Tariff for interconnections below 60 kV. Any conflicts with regard to metering standards that may arise between this Agreement, the PG&E WD Tariff, or the CAISO Tariff shall be resolved consistent with the applicable tariff. Power deliveries shall be metered at delivery voltages described in Appendix A. At a minimum, the Responsible Meter Party shall meter all power flowing across each Point of Interconnection in either direction. The Parties shall cooperate in the installation and provision of access to the meters, as necessary for each Party to obtain the information needed to perform as contemplated under this Agreement. 37 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 12.2 Requirements For Meters And Meter Maintenance The Responsible Meter Party is obligated to install and maintain metering equipment, including where necessary RTUs, in accordance with CAISO standards, at each Point of Interconnection that shall measure and record real and reactive power flows and shall be capable of recording flows in both directions. Such "in" and "out" meters shall be designed to prevent reverse registration and measure and continuously record such deliveries. 12.3 The NCPA Parties' Obligation To Provide Meter Data To PG&E NCPA and the NCPA Member Customers, pursuant to the NCPA MSS Agreement, subject to any exemptions granted by the CAISO, supplies the CAISO with both telemetry and settlement quality meter data for each Point of Interconnection. The telemetry data includes generator status, voltage and energy output. NCPA or an NCPA Member Customer will be the Responsible Meter Party for each meter and will grant PG&E access to the same metering data in accordance with the NCPA MSS Agreement. NCPA or an NCPA Member Customers shall also grant PG&E access to metering data that is supplied to the CAISO in accordance with the NCPA MSS Agreement that is associated with generating units interconnected to the Electric System of NCPA or an NCPA Member Customers. NCPA or an NCPA Member Customer will reasonably cooperate with PG&E to ensure that PG&E can successfully access metering data under this Section 12.3. Should the NCPA MSS Agreement terminate for any reason, the Parties shall cooperate in determining an alternative method for supplying PG&E the same level of access to data as it had under the NCPA MSS Agreement and this Agreement. In addition, where there is real-time telemetry of NCPA or NCPA Member Customer generation facilities and transmission interconnections of one (1) MW or larger, NCPA and/or NCPA Member Customers shall provide PG&E with the available real-time telemetry via the existing PG&E to NCPA Inter -Control Center Protocol ("ICCP") data link. 12.4 Consequences of Failing to Provide Meter Data In the event that the Responsible Meter Party fails to provide to PG&E access to available meter data in accordance with Section 12.3, PG&E shall be entitled to make reasonable assumptions necessary for the operation of its transmission system. The assumptions shall be W PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. based on reasonably available information including, but not limited to, records of historical usage, available data and meter readings and general characteristics of NCPA or the NCPA Member Customers' operation and facilities. 12.5 Periodic Meter Testing All meters necessary to operate each Point of Interconnection shall be installed, tested, and maintained in accordance with the CAISO Tariff and Good Utility Practice, and shall be tested periodically by the Party owning the meter, at intervals consistent with the CAISO Tariff, and at any other reasonable time upon request by PG&E (if an NCPA Party) or NCPA or an NCPA Member Customer (if PG&E). Meters shall be sealed and the seals shall be broken only upon occasions when the meters are to be inspected, tested, or adjusted, and representatives of PG&E (if an NCPA Parry) or the NCPA Parties (if PG&E) shall be afforded reasonable opportunity to be present upon such occasions. Notwithstanding a Party's obligation to afford reasonable opportunity for other Parties to be present for meter inspections, testing or adjustments, if metering equipment that is used to collect settlement qualify data requires immediate maintenance or repair, such maintenance or repair may be completed by the owning Party at is sole discretion. 13 BILLING AND PAYMENT PG&E shall bill NCPA and/or an NCPA Member Customer, and NCPA and/or an NCPA Member Customer shall pay any amounts owed to PG&E pursuant to this Agreement in accordance with Appendix D. NCPA and/or an NCPA Member Customer shall bill PG&E, and PG&E shall pay any amounts owed to NCPA and/or an NCPA Member Customer pursuant to this Agreement, where Sections D.1 through D.9 of Appendix D shall hereto apply to PG&E's payment obligations to NCPA and/or an NCPA Member Customer, substituting "NCPA" and/or "NCPA Member Customer" for "PG&E", respectively, in accordance with Appendix D. WN PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 14 ACCOUNTING 14.1 Accounting Procedures Service Agreement No. The Parties shall record relevant Cost(s) and maintain accounting records in accordance with generally accepted accounting practices and as to PG&E the FERC Uniform System of Accounts. 14.2 Audit Rights For good cause and upon reasonable notice, each Party shall have the right to audit, at its own expense, the relevant records of PG&E (if an NCPA Party) or NCPA or an NCPA Member Customer (if PG&E) for the limited purpose of determining whether the other Party is meeting its obligations under this Agreement. Such audits shall be limited to only those records reasonably required to determine compliance with this Agreement, and each Party agrees to disclose the information obtained in such audit only to those persons, whether employed by such Party or otherwise, that are directly involved in the administration of this Agreement and that are permitted to have access to such information under applicable regulations, including the FERC Standards of Conduct. Each Party agrees that under no circumstances will it use any information obtained in such an audit for any commercial purpose or for any purpose other than assuring enforcement of this Agreement. The right to audit shall be limited to data for two prior years from the date of the final billing for a matter or from the date of the questioned event, as applicable. 15 ADVERSE DETERMINATION OR EXPANSION OF OBLIGATIONS 15.1 Adverse Determination If, after the Effective Date of this Agreement, FERC or any other regulatory body, agency or court of competent jurisdiction determines that all or any part of this Agreement, its operation or effect is unjust, unreasonable, unlawful, imprudent or otherwise not in the public interest, each Party shall be relieved of any obligations hereunder to the extent necessary to comply with or eliminate such adverse determination. The Parties shall promptly enter into good faith negotiations in an attempt to achieve a mutually agreeable modification to this Agreement to address any such adverse determination. PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 15.2 Expansion Of Obligations If, after the Effective Date of this Agreement, FERC or any other regulatory body, agency or court of competent jurisdiction orders or determines that this Agreement should be interpreted, modified, or significantly extended in such a manner that a Party may be required to extend its obligations under this Agreement to a Third Party, or to incur under this Agreement significant new or different obligations to another Party or to Third Parties not contemplated by this Agreement, then the Parties shall be relieved of their obligations to the extent lawful and necessary to eliminate the effect of that order or determination, and the Parties shall attempt to renegotiate in good faith the terms and conditions of the Agreement to restore the original balance of benefits and burdens contemplated by the Parties at the time this Agreement was made. 15.3 Renegotiation If, within three months after an order or decision as described in Sections 15.1 and 15.2, the Parties either: (i) do not agree that a renegotiation is feasible or necessary; or (ii) the Parties cannot agree to amend or supersede this Agreement, then: (a) any Party may initiate dispute resolution in accordance with Section 22; (b) PG&E may unilaterally file an amendment to this Agreement or a replacement agreement; or (c) the NCPA Parties may take any action before the FERC or elsewhere which it deems appropriate. The effect of any termination under this Section 15.3, and the rights of the Parties thereunder, shall be as provided in Sections 36 and 37. As used in this Section 15.3, the term "Agreement" includes both this Agreement and any tariff, rate or rate schedule that in whole or in part results from this Agreement. 16 ASSIGNMENT 16.1 Consent Required No transfer or assignment of the rights, benefits or duties of any Party under this Agreement shall be effective without the prior written consent of the other Parties except as provided herein, which consent shall not be withheld unreasonably; provided, that this Section 16 shall not apply to interests that arise by reason of any deed of trust, mortgage, indenture or security agreement heretofore granted or executed by any Party. No partial assignment of the 41 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. rights, benefits or duties of any Party shall be permitted under this Agreement unless otherwise agreed to by PG&E (if an NCPA Party) or NCPA and the NCPA Member Customers (if PG&E), except that the NCPA Parties may assign the rights, benefits and duties under this Agreement among themselves at their discretion. 16.2 Assignee's Continuing Obligation Any successor to or transferee or assignee of the rights or obligations of a Party, whether by voluntary transfer, judicial sale, foreclosure sale or otherwise, shall be subject to all terms and conditions of this Agreement to the same extent as though such successor, transferee, or assignee were an original Party. 17 CAPTIONS All indices, titles, subject headings, section titles and similar items are provided for the purpose of reference and convenience and are not intended to affect the meaning of the contents or scope of the Agreement. 18 CONSTRUCTION OF THE AGREEMENT Ambiguities or uncertainties in the wording of the Agreement shall not be construed for or against any Party. 19 CONTROL AND OWNERSHIP OF FACILITIES The Electric System of a Party shall at all times be and remain in the exclusive ownership, possession and control of the Party, or licensed or leased to that Party as provided in the applicable arrangement, and nothing in this Agreement shall be construed to give another Party any right of ownership, possession or control of all or any portion of that Electric System. All facilities owned and installed by one Party hereunder shall, unless otherwise agreed by the Parties, at all times be and remain the property of that Party, except that the NCPA Parties may transfer ownership of property among themselves at their discretion. 42 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. 20 COOPERATION AND RIGHT OF ACCESS AND INSPECTION Each Party shall give to the others all necessary permission to enable it to perform its obligations under the Agreement. PG&E shall give to the NCPA Parties, and the NCPA Parties to PG&E, the right to have their agents, employees and representatives, on reasonable notice and accompanied by the agents, employees and representatives of the other Party, enter its premises at reasonable times and in accordance with reasonable rules and regulations for the purpose of inspecting the property and equipment of the other Party to the extent necessary and in a manner that is reasonable for assuring the performance of the Parties under the Agreement. 21 DEFAULT 21.1 Termination For Default If any Party breaches its material obligations under this Agreement, such breach shall constitute an event of default. If any Party defaults under this Agreement, another Party may terminate this Agreement as to the defaulting Party; provided that prior to such termination the non -defaulting Party must provide the defaulting Party with written notice stating: 1) the non - defaulting Party's intent to terminate; 2) the date of such intended termination; 3) the specific grounds for termination; 4) specific actions that the defaulting Party must take to cure the default, if any; and 5) a reasonable period of time, which shall not be less than 60 calendar days, within which the defaulting Party may take action to cure the default and avoid termination, provided there is any action which can be taken to cure the default. Termination shall not become effective without approval by FERC. Application of dispute resolution pursuant to Section 22 with regard to separate disputes shall not be deemed to limit the right to terminate this Agreement under this Section 21.1. Notwithstanding the right of a non -defaulting Party to terminate this Agreement pursuant to Section 21.1, if less than all of the NCPA Member Customers exercise such right, the Agreement shall remain in full force and effect as to the remaining Parties. Nor will the default of one or more NCPA Member Customers allow termination of the Agreement with respect to NCPA itself or the other NCPA Member Customers. 43 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 21.2 Other Remedies For Default The remedy under Section 2 1. 1 is not exclusive and, subject to Section 22, any Party shall be entitled to pursue any other legal, equitable or regulatory rights and remedies it may have in response to a default by another Party. 22 DISPUTE RESOLUTION The Parties shall make best efforts to resolve all disputes arising under this Agreement expeditiously and by good faith negotiation. Where this Agreement specifically calls for resolution of disputes pursuant to this Section 22, the Parties shall pursue dispute resolution according to the provisions of Appendix B. 23 GOVERNING LAW This Agreement shall be interpreted, governed by and construed under the laws of the State of California, as if executed and to be performed within the State of California. 24 INDEMNITY 24.1 Definitions As used in this Section 24, with initial letters capitalized, whether in the singular or the plural, the following terms shall have the following meanings: 24.1.1 Accidents (i) Accidents sustained by a Third Party ("Claimant"), which is an ultimate use customer of a Party; (ii) arises out of delivery of, or curtailment of, or interruption to electric service, including but not limited to abnormalities in frequency or voltage; and (iii) results from either or both of the following: PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 a. engineering, design, construction, repair, supervision, inspection, testing, protection, operation, maintenance, replacement, reconstruction, use, or ownership of any Party's Electric System; or b. the performance or non-performance of any Party's obligations under the Agreement. 24.2 Indemnity Duty If a Claimant makes a claim or brings an action against a Party seeking recovery for loss, damage, Costs or expenses resulting from or arising out of an Accident the following shall apply: 24.2.1 That Party shall defend any such claim or action brought against it, except as otherwise provided in this Section 24.2. 24.2.2 A Party ("Indemnitor") shall hold harmless, defend and indemnify, to the fullest extent permitted by law, PG&E (if such claim or action is brought against an NCPA Party) or NCPA or an NCPA Member Customer (if such claim or action is brought against PG&E), its directors or members of its governing board, officers and employees ("Indemnitees"), upon request by the Indemnitee, for claims or actions brought against the Indemnitee allegedly resulting from Accidents caused by acts, errors or omissions of the Indemnitor. 24.2.3 No Party shall under this Agreement be obligated to defend, hold harmless or indemnify another Party, its directors or members of its governing board, officers and employees for Accidents resulting from the latter's gross negligence or willful misconduct. 24.2.4 45 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. In the event a dispute under this Section 24 is litigated, each Party specifically agrees to pay its own incurred Costs including attorney's fees, expert and consultant fees, and other Costs of litigation. 25 JUDGMENTS AND DETERMINATIONS When the terms of this Agreement provide that an action may or must be taken, or that the existence of a condition may be established based on a judgment or determination of a Party, such judgment shall be exercised or such determination shall be made reasonably and in good faith, and where applicable in accordance with Good Utility Practice and shall not be arbitrary or capricious. 26 LIABILITY 26.1 To Third Parties Nothing in this Agreement shall be construed to create any duty to, any standard of care with reference to, or any liability to, any Third Party. 26.2 No Consequential, Special or Indirect Damages from Breach Except for its willful action, gross negligence, or with respect to breach of this Agreement or the indemnity duty under Section 24.2, no Party, nor its directors or members of its governing board, officers, employees or agents shall be liable under this Agreement to another Party for any loss, damage, claim, Cost, charge or expense arising from or related to this Agreement. In the event of breach of this Agreement, no Party, nor its directors or members of its governing board, officers, employees or agents shall be liable under this Agreement to another Party for any consequential, special or indirect damages. 26.3 Protection Of A Party's Own Facilities Each Party shall be responsible for protecting its facilities from possible damage by reason of electrical disturbances or faults caused by the operation, faulty operation, or non- operation of PG&E's (if an NCPA Party) or NCPA's or an NCPA Member Customers' (if PG&E) facilities, and such other Party shall not be liable for any such damage so caused; .o PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. provided, this limitation on liability shall not extend to failure to observe the requirements of Section 10. 26.4 Liability For Interruptions PG&E shall not be liable to the NCPA Parties, and the NCPA Parties shall not be liable to PG&E, and each hereby releases the others and their directors, members of their governing board, officers, employees and agents from and indemnifies them, to the fullest extent permitted by law, for any claim, demand, liability, loss or damage, whether direct, indirect or consequential, incurred by either, that results from the interruption or curtailment in accordance with i) this Agreement, ii) Good Utility Practice, or (iii) as directed by the CAISO, of power flows through a Point of Interconnection under this Agreement. 27 NO DEDICATION OF FACILITIES Any undertaking by any Party under any provision of this Agreement is rendered strictly as an accommodation and shall not constitute the dedication by the first Party of any part or all of its Electric System to the other, the public, or any Third Party. Any such undertaking by any Party under a provision of, or resulting from, this Agreement shall cease upon the termination of that Party's obligations under this Agreement. 28 NO OBLIGATION TO OFFER SAME SERVICE TO OTHERS By entering into this Agreement to interconnect with the NCPA Parties or any Third Party at NCPA's or an NCPA Member Customer's request, and filing it with FERC, PG&E does not commit itself to furnish any like or similar undertaking to any other person or entity. 29 NO PRECEDENT This Agreement establishes no precedent with regard to any other entity or agreement. Nothing contained in this Agreement shall establish any rights to or precedent for other arrangements as may exist, now or in the future, between the Parties for the provision of any interconnection arrangements, interconnection service, or any form of electric service. 47 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 30 NO OTHER SERVICES PROVIDED No Party undertakes under this Agreement the obligation to provide or make available any transmission service, distribution service, power or energy sales or services or Ancillary Services for any other Party or any Third Party, unless otherwise agreed to by a Party, and where such provision or receipt of services will be made pursuant to a separate agreement. Provided, however, this Agreement does not supersede rights or obligations as provided in Existing Contracts. 30.1 Limitation on Parties Obligation The Parties specifically intend that this Agreement shall relate only to their rights and obligations pertaining to the interconnection of their Electric Systems. Under this Agreement, no Party undertakes to provide or make available any Balancing Authority Area services, transmission service, distribution service, power or energy sales or services or Ancillary Services for any other Party or any Third Party, and in no circumstance shall anyParty be responsible under this Agreement for providing any such services. This Agreement does not supersede rights or obligations as provided in any other agreement between any or all of the Parties. Nothing in this Agreement shall prevent any Party from seeking an order under Section 211 or 212 of the FPA. 30.2 Transmission Arrangements The NCPA Parties are currently party to several contracts that, among other things, provide Transmission Arrangements for the delivery of power to NCPA Parties' Electric Systems. Nothing in this Agreement shall interfere with the NCPA Parties' rights, including those for transmission services, provided under such contracts. All Parties may make Transmission Arrangements, other than or in addition to such service provided from the CAISO. PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 31 NOTICES 31.1 Written Notices Service Agreement No. Any notice, request, declaration, demand, information, report, or item otherwise required, authorized or provided for in this Agreement shall be given in writing, except as otherwise provided in this Agreement, and shall be deemed properly given if delivered personally or by facsimile transmission (fax), sent by first class United States Mail or overnight or express mail service, postage or fees prepaid, or through electronic communication where such electronic communication shall be deemed delivered on the first business day following delivery, to each of the persons specified below: (1) To NCPA: Randy Howard General Manager Northern California Power Agency 651 Commerce Drive Roseville, CA 95678 AND Tony Zimmer Supervisor, Industry Restructuring & Interconnection Affairs Northern California Power Agency 651 Commerce Drive Roseville, CA 95678 (2) To PG&E: Mr. David Rubin Director, Service Analysis Pacific Gas and Electric Company Mail Code N9p P.O. Box 770000 San Francisco, CA 94177 S1 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 With a copy to: Mr. Yilma Hailemichael Manager, Transmission Contract Management Pacific Gas and Electric Company Mail Code B13L P.O. Box 770000 San Francisco, CA 94177 And: Mr. Bruce Henry Director, Transmission System Operations Pacific Gas and Electric Company Mail Code B 15A P.O. Box 770000 San Francisco, CA 94177 (3) To City of Alameda: Glenn Steiger General Manager Alameda Municipal Power 2000 Grand Street Alameda, CA 94501 (4) To City of Biggs: Mark Sorensen City Administrator City of Biggs P.O. Box 307 465 "C" Street Biggs, CA 95917 Service Agreement No. 50 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 (5) To City of Gridley: City Administrator City of Gridley 685 Kentucky Street Gridley, CA 95948 (6) To City of Healdsburg: Terry Crowley Electric Utility Director City of Healdsburg 401 Grove Street Healdsburg, CA 95448 (7) To City of Lodi: Elizabeth Kirkley Utility Director City of Lodi 1331 South Ham Lane Lodi, CA 95242 (8) To City of Lompoc: Larry Bean Utility Department Director City of Lompoc P.O. Box 8001 100 Civic Center Plaza Lompoc, CA 93438 Service Agreement No. 51 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 (9) To City of Palo Alto: Valerie Fong Utilities Director City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 (10) To Plumas-Sierra Rural Electric Cooperative: Bob Marshall General Manager Plumas-Sierra Rural Electric Cooperative 73233 Highway 70 Portola, CA 96122 (11) To City of Ukiah: Mel Grandi Utility Director City of Ukiah 300 Seminary Avenue Ukiah, CA 95482 31.2 Changes Of Notice Recipient Service Agreement No. Any Party may change its designation of the person who is to receive notices on its behalf by giving the other Parties notice thereof in the manner provided in this Section 31. No more than three persons shall be designated by a Party to receive notices. 31.3 Routine Notices Any notice of a routine character in connection with service under this Agreement or in connection with the operation of facilities shall be given in such a manner as the Parties may determine is appropriate from time to time, unless otherwise provided in this Agreement. 52 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 31.4 Reliance On Notice Service Agreement No. Every Party shall be entitled under this Agreement to rely on another Party's notice when given (or not given, when a Party fails to provide notice within the time prescribed) as having all necessary approvals of that other Party's management, Board of Directors or other governing body, and any notice (or failure to provide timely notice) hereunder shall be binding on the noticing Party and shall obligate that Party to make such payments or to perform such duties as are necessarily associated with the notice or, if a Party fails to provide timely notice, that failure to give notice. 32 RESERVATION OF RIGHTS Nothing contained herein shall be construed as affecting in any way the Parties' rights under Sections 205 and 206 of the FPA or the regulations promulgated thereunder. The term "rates" as used herein shall mean a statement of rates and charges for or in connection with the services provided for in this Agreement, and all classifications, practices, rules or regulations that in any manner affect or relate to such rates and charges. PG&E may unilaterally make application to FERC for a change in rates, including rate methodology and the terms and conditions of service, under Section 205 of the FPA and pursuant to FERC's rules and regulations promulgated thereunder. Any party may seek changes to the terms of this Agreement pursuant to Section 206 of the FPA. Nothing contained herein shall be construed as affecting in any way the right of the NCPA Parties to oppose such a change under Section 205 or FERC's rules and regulations or to exercise its rights under Section 206 of the FPA or FERC's rules and regulations. 33 RESPONSIBILITY FOR PAYMENTS AND SECURITY All Parties shall be fully responsible and liable to each other for payments to be made under this Agreement. The Parties shall perform unconditionally and fully each and every obligation that each has under this Agreement; provided, that this Agreement shall not restrict any right any Party may otherwise have to pledge any of its revenues, funds, assets, rights, property or interests therein. A Party's status as a creditor shall not be subordinate to the interest of any creditor, subject to any pledge or debt obligation, provision of law or existing obligations of a Party. 53 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 34 RULES AND REGULATIONS Service Agreement No. The Parties may propose, from time to time, changes to such procedures, rules, or regulations as they shall determine are necessary in order to establish the methods of operation to be followed in the performance of this Agreement or requirements of the Balancing Authority; provided, that any such procedure, rule, or regulation shall not be inconsistent with the provisions of this Agreement. If a Party objects to a procedure, rule, or regulation proposed by another Party, it will notify the other Parties and the Parties will endeavor to modify the procedure, rule, or regulation in order to resolve the objection. No such procedure, rule or regulation shall be adopted absent the mutual written consent of the Parties. 35 SEVERABILITY If any term, covenant or condition of this Agreement or its application is held to be invalid as to any person, entity or circumstance, by FERC or any other regulatory body, or agency or court of competent jurisdiction, then such term, covenant or condition shall cease to have force and effect to the extent of that holding. In that event, however, all other terms, covenants and conditions of this Agreement and their application shall not be affected thereby, but shall remain in full force and effect unless and to the extent that a regulatory agency or court of competent jurisdiction finds that a provision is not separable from the invalid provision(s) of this Agreement. 36 CONTINUING RIGHTS OF THE NCPA PARTIES UPON TERMINATION Upon termination of the Agreement, the NCPA Parties shall continue to have such rights, if any, to be connected to PG&E's Electric System that are provided by law, regulation or other contract or agreement; provided, that the existence of this Agreement, after its termination, shall not be used by any Party to establish or defeat the existence of any rights provided by law, regulation or other contract or agreement. Termination of this Agreement, if accepted or approved by FERC, also shall terminate any other tariff or rate schedule that in whole or in part results from this Agreement, to the extent not inconsistent with a Party's aforementioned rights at law. After termination of this Agreement and any required FERC acceptance or approval of such termination, all obligations and rights provided under this Agreement or such tariff or rate schedule shall cease, and no Party shall claim or assert any continuing right other than as may be 54 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. provided by law, regulation or other contract or agreement. Such termination shall not affect rights and obligations of a continuing nature or for payment of money for goods or services provided prior to termination. This Section shall not be construed as a bar to the assertion by the NCPA Parties of any rights it may have to service following termination of this Agreement, independent and exclusive of the Agreement. 37 RIGHTS OF PG&E UPON TERMINATION Should FERC deny, condition, suspend or defer PG&E's notice of termination, PG&E shall under no circumstances be required to maintain any interconnections or to provide any services, based in whole or in part on the existence of this Agreement, beyond the minimum time necessary for compliance with FERC's denial, condition, suspension or deferral. 38 WAIVER OF RIGHTS Any waiver at any time by any Party of its rights with respect to a default under the Agreement, or with respect to any other matter arising in connection with the Agreement, shall not constitute or be deemed a waiver with respect to any subsequent default or other matter arising in connection with this Agreement. Any delay, short of the statutory period of limitations, in asserting or enforcing any right shall not constitute or be deemed a waiver. 39 UNCONTROLLABLE FORCES A Party shall not be considered to be in default in the performance of any obligation under the Agreement (other than an obligation to make payments for bills previously rendered pursuant to the Agreement) when a failure of performance is the result of Uncontrollable Forces. 40 ENTIRE AGREEMENT AND AMENDMENTS PG&E and the NCPA Parties agree that the provisions of this Agreement constitute the entire agreement between them regarding the subject matter of the Agreement and the Parties' rights and obligations with respect thereto. This Agreement is intended to be the complete and exclusive statement of the terms of the Parties' agreement that supersedes all prior and contemporaneous offers, promises, representations, negotiations, discussions or communications between PG&E and the NCPA Parties that may have been made in connection with the subject 55 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 Service Agreement No. matter of this Agreement. No representation, covenant, or other matter, oral or written, that is not expressly set forth, incorporated, or referenced in this Agreement (except for applicable laws and regulations) shall be a part of, modify, or affect this Agreement. This Agreement may be modified by written agreement of the Parties. Each subpart of Appendix A of this Agreement may be modified by the written agreement of PG&E and the NCPA Member Customer to whose Point(s) of Interconnection that subsection applies, without the agreement of any other Party. 41 NO THIRD PARTY RIGHTS OR OBLIGATION No right or obligation contained in this Agreement shall be applied or used for the benefit of any person or entity that is not a Party. 42 WARRANTY OF AUTHORITY Each Party warrants and represents that this Agreement has been duly authorized, executed and delivered by such Party and constitutes the legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, or similar laws effecting the enforcement of creditor's rights. 43 COUNTERPARTS This Agreement may be executed in any number of counterparts, and each executed counterpart shall have the same force and effect as an original instrument and as if all the signatories to all of the counterparts had signed the same instrument. Any signature page of this Agreement may be detached from any counterpart of this Agreement without impairing the legal effect of any signatures thereon, and may be attached to another counterpart of this Agreement identical in form hereto but having attached to it one or more signature pages. 56 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 44 APPENDICES INCLUDED Service Agreement No. The following Appendices to this Agreement, as they may be revised from time to time by written agreement of the Parties or by order of FERC, are attached hereto and are incorporated by reference as if fully set forth herein: Appendix A — Points of Interconnection Appendix B — Dispute Resolution and Arbitration Appendix C — Upgrade Facilities Appendix D — Billing and Payments Appendix E — Operational Coordination 57 PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 45 EXECUTION IN WITNESS THEREOF, the Parties have, by signature of its duly authorized representative shown below, executed and delivered a counterpart of this Agreement. NORTHERN CALIFORNIA POWER AGENCY Name: Randv S. Howard Title: General Manger PACIFIC GAS AND ELECTRIC COMPANY LE Name: David Rubin Title: Director, Service Analysis CITY OF ALAMEDA Name: Title: W'' PACIFIC GAS AND ELECTRIC COMPANY Service Agreement No. FERC Electric Tariff Volume No. 5 CITY OF BIGGS By: Name: Title: CITY OF GRIDLEY By: Name: Title: CITY OF HEALDSBURG By: Name: Title: CITY OF LODI By: Name: Title: Approved as to farm City Attorney 59 PACIFIC GAS AND ELECTRIC COMPANY FERC Electric Tariff Volume No. 5 CITY OF LOMPOC M. Name: Title: CITY OF PALO ALTO LM Name: Title: PLUMAS SIERRA RURAL ELECTRIC COOPERATIVE By: Name: Title: CITY OF UKIAH By: Name: Title: Service Agreement No. APPENDIX A POINTS OF INTERCONNECTION NCPA Member Customer Point(s) of Interconnection Voltage (kV) Alameda Oakland Substation C and Oakland 115 (Both Points) Substation J Biggs Biggs Sub (60 kV and 12 kV) 60 and 12' Gridley Gridley Sub 60 Healdsburg Healdsburg Sub 60 Industrial Sub (Lodi Line 1 and Lodi Line 2); 60 (Both Industrial Points) Lodi and White Slough STIG2 230 (White Slough STIG) Lompoc Lompoc Sub (Lompoc Line 1 and Lompoc 115 (Both Points) Line 2) Palo Alto Colorado Sub (Palo Alto Line 1, Palo Alto 115 (All 3 Points) Line 2, and Palo Alto Line 3 Plumas Sierra Quincy Sub 60 Ukiah Babcock Sub 115 As set forth in the Interruptible Wholesale Distribution Service and Interconnection Agreement between PG&E and the City of Biggs (12 kV Agreement," PG&E Rate Schedule ), PG&E's 12 kV system and the facilities needed to retain the connection with the City of Biggs shall only be used for delivery in emergency conditions or during scheduled maintenance of the 60 kV system and only on an as available and interruptible basis, after notification by the party requesting such use. Notwithstanding anything in this Agreement or the 12 kV Agreement, PG&E may take the 60 kV system out of operation or schedule maintenance on the 60 kV system regardless of available capacity on the 12 kV system; provided, however, that PG&E otherwise communicates and coordinates planned outages with NCPA and the City of Biggs in accordance with Section 9.4 of this Agreement. 2 Lodi Wastewater treatment plant Load will be served via the Lodi White Slough STIG Interconnection with PG&E, be separately metered, and be included in the normal, coincident and non -coincident Load information for Lodi. 61 FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF ALAMEDA The following is a single -line diagram of the City of Alameda's ("Alameda") Interconnection Facilities at the Points of Interconnection that identifies the owner of such Interconnection Facilities. ESTUq ARY TO 1 SARTO ---To Oakland Sta. J 750MCN1 — _ — F-90� T ---- 7SONCN ,----- 500YC11 SUBMARINE—+---+--� 1 — — — — — - E5T IRARY .I yl _.—.—.—.r.—.— 413 (, 123 City Of 1 112 [r\H'I--[lx�� HU Alameda 411 X902 1zl 1 TRANSITION �oo� 4 1 h STATION 1 1p5 ® ❑M 995 r 1 395 395 20 341 391 ------- - LTC LiC E ryIHI. 107 102 J173 F 1 S56.5 ACSF 191 IzlT T 171Ig2 Iq2J�'12 122 �:91 i! 133 123 r95 ws r13s�, ss 212 JENNY SUB •E' lap 213 (CITY OF ALAiAEDA]— J W1 --------- 221 2 2 223 S.AI{ 1 wnl�n I 11�nv •�- Oakland C Substation — Partial 313h- 323— — - ---- i -----I 312 1 1 233 11( 1213 1 1 311 ILIr_ 30 321 232f� �2�P i 01 FOF� TT\\ Point Of Interconnection 1 231 z91 375 O 0 0 SINS 1 �1 1 Point of Change of Ownership Tz 1 ., 61 .261 1 5261 y y5262 5SNCF 55�CA I 1 01 02 SUY 5mv I GAS TURBIES I SU (CITY OF ALL MEDA) C(CIITY OFF ALAMEDA)B 62 'J, sue 115KY 115154 Point of Interconnection gas ads Point of Change of Ownership .� i 525 12S L L 523 '�' 523 Isz llss 715 AL 411 �44R 4y1 I I I I 192 195 4T© ❑M�^^^'S. i i � 191 1$ I '1 I BK _ _ RK I LTC LT•. i I OAKLAND 'J' - ALAMEDA 115KV 556,5 I-- — — — — — — — — — — — — ——— x4------ I I I I I 1 JENNY SUB (CITY Or ALAMEDA)--j To Cartwright 63 ;ECT. 'C' ISI 1$j OAKLAND 'J' - ALAMEDA 115KY I 558.5 ■45R 172 175 r - r I TRANSITION i85 STATION S I I Is116j� I u2 I — I ------i 75C1YLY 1u 11,3��Tl`l�ss � E5il1R ARY I 131 133 _ _ — — — — — OAK- --41l L SOO�CuJ ! 544rCr J I i85 405 — I LL % I RANSITIO—N TRANSITION I I E 161 183 ls� STATION w I I 12 1+5 412 422 I —A�-- I I ti 141 143 715 AL 411 �44R 4y1 I I I I 192 195 4T© ❑M�^^^'S. i i � 191 1$ I '1 I BK _ _ RK I LTC LT•. i I OAKLAND 'J' - ALAMEDA 115KV 556,5 I-- — — — — — — — — — — — — ——— x4------ I I I I I 1 JENNY SUB (CITY Or ALAMEDA)--j To Cartwright 63 FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF BIGGS The following is a single -line diagram of the City of Biggs' (`Biggs") Interconnection Facilities at the Point of Interconnection that identifies the owner of such Interconnection Facilities. Point of Interconnection Point of Change of Ownership 4 14 29713 11 333 2\? 300 2 12 22 of 296�—-------- 17 $5 75 12 247 9 15 3� #2 RiH1 #I 12 3 1.9MVA R� 1-3.IMYA 248 CITY OF BIGGS SUBj "' "1 j • ` "1 L — — ——[NCPR) — — — 1 zKv IZKv 14 294 PEACHTON SUB ^1 51-2 4-1.7mvA yl -I 0bl-3 12Kv \ 15 ]J]J 61-5 85 331 87 "2 3-1.7MVA 62-5 12KV 62-I 62-3 $9 b2-2 5 GRIDLEY Sub — (CITY OF GRIDLEY) 333 (NCPA) PEACHTON - PEASE 60KV 715.$ AL FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF GRIDLEY The following is a single -line diagram of the City of Gridley's ("Gridley") Interconnection Facilities at the Point of Interconnection that identifies the owner of such Interconnection Facilities. 14 297 12 296 -- 17 - 247 19 15 3 12 248 CITY OF BICCS SUB L----[NCPA) --- 14 299 r^I -61-2 - 4-1.7mvA �[Oj-� 61-1 J - \51-3 12KV 15 ]J]J 61-5 85 331 ST "2 3-1.7MVA 62-5 12KV 52-1 W62-3 89 62-2 5 GRIDLEY SUB — (CITY OF GRIDLEY) 333 (NCPA) e iR7 14 13 31 �33 21 23 300 12 22 5 85 75 #21HI � HI #1 3-I.9MVA 12KV "1 12KV PEACHTON SUB Point of Interconnection Point of Change of Ownership PEACHTON - PEASE 60KV 715.5 AL 65 FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF HEALDSBURG The following is a single -line diagram of the City of Healdsburg's ("Healdsburg") Interconnection Facilities at the Points of Interconnection that identifies the owner of such Interconnection Facilities. 1VA L 12KV LIS SUB Point of Interconnection Point of Change of Ownership -I oy1rA Erb xr 2 3 5r p FULToN R160KV 2{0 cu di I -fie �.r YJ4 I hia Ig 85 3D 99 IZKw a 3F 2_345MVA 4/0 +L 1-3.5MYi 1 49 75 3T 12KV SA I& 19 3C GEYSERVILLE SUB BADGER SUB I 25MVA npTT OF hEALDS81.1 T2 51 � 2541Vi SS SUB MVn LQKY F1 1 21 a i FULTON "1 60KV 0 4!0 .5L d acss HEALDSBLIRG 12 60KV TAP L 0 10 pg 59 Q IND O 0 7T S 69 FITCH MTN. g JC T 112 19A 9 I& FITCH MOUNTAIN •2 60KV TAP a?a cu I HEALUSSURG JCT. 0 HEALCSBURG 0160KV TAP 25 2 NO FF P. 410 AL 12KV L2KV FITCH MOUNTAIN SUB FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF LODI The following is a single -line diagram of the City of Lodi's ("Lodi") Interconnection Facilities at the Points of Interconnection that identifies the owner of such Interconnection Facilities. WOODBRIUCE n I WINERY sus Y 33 l 25 " 2/0 CU12 L---------2-5--r--J 19A 15 13 II Tf0006RI0GE 60KY lAP WOOOBRIOGE 12 T15.5 AL 14 LDCKEFORD - LODI •2 60KV 15 f JCT a5 A 4/0 AL q97 0 A2 No19 NSB NSB 1 T15.5 AL 0 RERATE 759AVPS NSB EYERGENCT 881 AMPS 5 INDUSTRIAL 75 33-�L JCTn7K •1 70YVA •2 32 LT�CI 2 3-L5MvA 1-I.TYVA 25 23 2121 5 rr` *_ ©^ 4-ASYYA � � ITI Y �29 22 12RY 12Kv �-'-1 B�BW CsJ 26 25 27 Bz VICTOR SUB 3 KKV AM BUS LODI • INDUSTRIAL 60KV SEC 715 LL LODI SUB INDUSTRIAL ..111 IAP 715 AL 759AYP5 9214YP5 EvERGENCT d 27 L Point of InterconnectionJIT B m [ �, _ Point of Change of Ownership IITY LOOI 3 53¢3 27 INDUSTRIAL152 A2 22 INCPAT 51 AI 21 TO Cu L-- 70W1 5 5 [FORD - LO01 .3 5014 16 n¢ niu 6 LOTN 516 TO 4908 69 POLE 618 L001 81 JCT AS Al 95 2T AS CMV K2 AIETTLER SUE� z9 p5 -3A X1.5441 2/O CU IID LTC pg)P Gf YI 0 S - INDUSTRIAL 6094 AL T59AYPST59AYP5 N0 SEC ' 3Tl LOCKEll - LODI- 3 60KV LOCKEFORO •16014 I I I Bus .2— J LOCKEFORO - LOOP -3 GCCV 3975AL RERATE 5284RETrEEN 2n TG 6,6 �Id LOCKEFORO - LODI -1 60KV 4/0 AL 2BUv S 285 6311 F B I�•2 1-39 200YYA UA"A LOCKEFORO SUB 23014 j Bus 73�JI tir TI ~ 3 75 I ]-3e 200441 STA Bc-3 �t,I I -3e 4! LTL 60KV 2RY AUK Bus NO 8P HARNEY �l 67 LANE `>' •z I 3A 16 ❑ 66 57 LTC G 2 I HARNEYLANE IA JC 12Kv JCT 27 69 5 NO 29 2,0 Cu WATERLOO 6 JCT 1 nrKFFCRID • I FnKV 67 FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF LOMPOC The following is a single -line diagram of the City of Lompoc's ("Lompoc") Interconnection Facilities at the Points of Interconnection that identifies the owner of such Interconnection Facilities. 13 i DIVIDE CABRILLO NO.2 115KV i15.5 AAC DIVIDE - CABRILLO NO.1115KV f15.5 AAC LDMPOC n9e J [C T 12 139 li 11 DIVIDE - CABRILLO '1115KV 4 3149 41 4P1 157 J 10 169 p CITY NO.1115KY TAP 397.5 5✓1C --------------------- 301 ---- — 301 302 201 202 101 IDE I-75UYi �`�'�/}I I•$544✓1 1 854Y� I I�x 1F' 122 III 1� III 101 I L-5- 0 I to �CITY OF L4MP4C, ------ Sue --- ---- Point of Interconnection Point of Change of Ownership 167 CITY NO.2 115KV TAP 39T.5 AAC .:, FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF PALO ALTO The following is a single -line diagram of the City of Palo Alto's ("Palo Alto") Interconnection Facilities at the Points of Interconnection that identifies the owner of such Interconnection Facilities. v COOLEY LANDING - 1T PALD ALTO SW STA 115KY Interconnection Point LJ 715.5 AL 1 11 RAVENSWOOD - PALO ALTO 11I115KV RAVENSWOOD - PALO ALTO R2 I15KV T15.5 AL 1 12 2 2 xz OAi C1Tr OF PALO ALTO COLORADO PWR STA zn I �3 35 1-3• 168NVk I 32 �• I " ( �I C{ 1•10 169MY06 GC�1 52 I s3 95 = L -3q 169k1Y� e�t _ tr City of Palo Alto L Point of Change of Ownership --------------- -------115KY eus .1 351 341 321 -057 e 442 4 PALO ALTO 31 SWITCHING STA 553 543 552 547 IiSKY 551 • 541 6U5 L � SSI i 9 32 4 Z 33 � 10 33b I I I I I I I I i J J 311 X11 are 4� 513 512 w 511 FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC PLUMAS SIERRA RURAL ELECTRIC COOPERATIVE The following is a single -line diagram of the Plumas Sierra Rural Electric Cooperative's ("Plumas") Interconnection Facilities at the Point of Interconnection that identifies the owner of such Interconnection Facilities. 6 ELIZABETH p7F — NIICX NO i3 17 I1 TOWN 7i +s 49 49 ;10 CARIBOU • PLUMAS JCT 60KV II N I+ TI �7 391 LSCA 5 61 ¢ E 1j CARIBOU 12 64Kv 7 CARIBOU • PLUIOAS JCT 60KV it 2 cu A CARIBOU 12 64Kv +5 .I s•z.isuYA 2 Cu y rtauv8 p ItAv '7'v "Y� v5s 12.SYvh Ix EAST QUINCi SUB LIC 75 �r NO `�+I 49A CARIBOU - PLUMAS JCT 60KV E) }} + SN41LN 7 GANSNER SUB 0 P PLUMAS SIERRA 60KV TAP 25 t 0 ---------------- p PLUMAS-SIERRA SUB I IRECI I as I IACPAI HO I put o ^ �ei 95 z� I pp1 J�uoS � 10 io 1 003 MARBLE 6 PLUMAS tfi I19 N-460 SLIBJCj 619 I I leas SIVR OLE I _ A07 uOP "+ 3-1ANVA SIERRA PACIFIC I ROIYER pTILIIY I I Point of Interconnection Point of Change of Ownership 70 FACILITIES AT POINT OF INTERCONNECTION AND OWNERSHIP SCHEMATIC CITY OF UKIAH The following is a single -line diagram of the City of Ukiah's ("Ukiah") Interconnection Facilities at the Point of Interconnection that identifies the owner of such Interconnection Facilities. Point of Interconnection Point of Change of Ownership -----------�4 I I I iER Y s. !. ,ER ;T1hA iMYA es G As 1 J MASONITE JC CITY OF UKIAH SUB es x i65 UKIAH 7, T- JCT w Qa UKIAH SUB MENDOCINO - PHILO JCT - HOPLA u 3�o cu MENDOCINO -16OKV CALPELLA SU; 41 ; 3 10 0 i 2 I !, 1 MENDOCINO GOKV , r !! voW a sx PHILO JCT - ELK 60KV csss ' @ r PHILO sai.s AE ce� JCT LN(IAH - HOPLAND - CLOVE ROALE 115KV 69 MENDOCINO - PHILO oJCT - HOPLAND 60KV d-0. IIA YS �6p 3-0.A1YA b HOPLAND SUB M 6 I I I WE I I I I I I I I I � I I r I 71 APPENDIX B DISPUTE RESOLUTION AND ARBITRATION BA NEGOTIATION AND MEDIATION As provided in Section 22, the Parties agree to seek settlement of all disputes arising under this Agreement by good faith negotiation before resorting to other methods of dispute resolution. In the event that negotiations have failed, but before initiating arbitration proceedings under this Appendix B, the Parties may by mutual assent decide to seek resolution of a dispute through mediation. If this occurs, the Parties shall meet and confer to establish an appropriate timetable for mediation, to pick a mediator, and to decide on any other terms and conditions that will govern the mediation. B.2 TECHNICAL ARBITRATION The Parties agree to seek expedited resolution of arbitrable disputes arising under this Agreement that are technical in nature. Technical disputes may include, without limitation, disputes centered on engineering issues involving technical planning studies, the need for and Cost of Upgrade Facilities, and the Interconnection Capacity of a Point of Interconnection. Such technical issues may be resolved through expert application of established technical knowledge and by reference to Good Utility Practice and industry standards. The Party initiating arbitration pursuant to Section 13.3 below shall indicate in its notice to the other Party whether it regards the dispute to be technical in nature. If the Parties agree that a dispute is technical in nature, then the Parties shall meet and confer to develop an appropriate timetable and process for expedited resolution of the dispute by a neutral expert, or "technical arbitrator". If the Parties cannot agree that a dispute is technical in nature, or if they cannot agree on a neutral arbitrator, then the Parties may submit the dispute to arbitration under the procedures set forth in Appendix B, Section 3 below. B.3 ARBITRATION 72 B.3.1 Notices And Selection Of Arbitrators In the event that a dispute is subject to arbitration under Section 22, the aggrieved Party or Parties shall initiate arbitration by sending written notice to the other Party or Parties. Such notice shall identify the name and address of an impartial person to act as an arbitrator. If any Party takes the position that the dispute is not arbitrable, any Party may take the dispute to FERC for resolution. Within ten (10) business days after receipt of such notice, the other Party or Parties shall, if they agree that the decision is properly arbitrable, give a similar written notice stating the name and address of the second impartial person to act as an arbitrator. Each Party (or aligned group of Parties) shall then submit to the two named arbitrators a list of the names and addresses of at least three persons for use by the two named arbitrators in the selection of the third arbitrator. If the same name or names appear on both lists, the two named arbitrators shall appoint one of the persons named on both lists as the third arbitrator. If no name appears on both lists, the two named arbitrators shall select a third arbitrator from either list or independently of either list. Each arbitrator selected under these procedures shall be a person experienced in the construction, design, operation or regulation of electric power transmission facilities, as applicable to the issue(s) in dispute. If NCPA and any one or more of the NCPA Members Customers are acting jointly or have aligned positions regarding the subject under arbitration, NCPA and the NCPA Member Customers who are acting jointly/have aligned positions will be treated as a single Party for the purposes of selection of an arbitrator. BA PROCEDURES Within fifteen (15) business days after the appointment of the third arbitrator, or on such other date to which the parties may agree, the arbitrators shall meet to determine the procedures that are to be followed in conducting the arbitration, including, without limitation, such procedures as may be necessary for the taking of discovery, giving testimony and submission of written arguments and briefs to the arbitrators. Unless otherwise mutually agreed by the parties, the arbitrators shall determine such procedures based upon the purpose of the Parties in conducting an arbitration under Section 22 of the Agreement, specifically, the purpose of utilizing the least burdensome, least expensive and most expeditious dispute resolution procedures consistent with providing each Party with a fair and reasonable opportunity to be 73 heard. If the arbitrators are unable unanimously to agree to the procedures to be used in the arbitration, the arbitration shall be governed by the Commercial Arbitration Rules of the American Arbitration Association. B.5 HEARING AND DECISION After giving the Parties due notice of hearing and a reasonable opportunity to be heard, the arbitrators shall hear the dispute(s) submitted for arbitration and shall render their decision within ninety (90) calendar days after appointment of the third arbitrator or such other date selected upon the mutual agreement of the Parties. The arbitrators' decision shall be made in writing and signed by any two of the three arbitrators. The decision shall be final and binding upon the parties subject to rights to appeal the decision to FERC. Judgment may be entered on the decision in any court of competent jurisdiction upon the application of any Party. B.6 EXPENSES Each Party shall bear its own Costs and the Costs and expenses of the arbitrators shall be borne equally by the Parties. If the NCPA Parties are acting jointly regarding the subject under arbitration, the NCPA Parties will be treated as a single Party for the purpose of allocating Costs and expenses of the arbitrators. 74 APPENDIX C UPGRADE FACILITIES C.1 UPGRADE FACILITIES At least 60 calendar days prior to the date on which NCPA or an NCPA Member Customer is to commence payment of any Cost as a result of construction of an Upgrade Facility, PG&E shall determine and provide to NCPA and the NCPA Member Customer, if applicable: (i) an estimate of all Cost, broken down by major activities, which PG&E expects to incur; and (ii) a schedule indicating the approximate dates when PG&E expects to pay such Cost for each major activity included in the estimate. PG&E may revise the payment schedule from time to time as appropriate. C.1.1 If needed, the Affected Parties will enter into a Transmission Facilities Agreement that shall include an estimate and schedule of Cost and payments , and the applicable NCPA Party shall advance such Cost to PG&E pursuant to such schedule or any revisions to it. C.1.2 The applicable NCPA Party's total payments to PG&E for work performed under this Appendix C, Section 1 shall be for the actual Cost incurred by PG&E. PG&E shall document to the NCPA Party the actual Cost incurred upon completion, and shall refund any amount overpaid by, or request any additional payment from, the NCPA Party, with interest computed as provided in Appendix D, Section D.6 of this Agreement. C.1.3 Should an NCPA Party seek a ruling from the Internal Revenue Service that its payments under this subsection should be treated as non-taxable contributions -in -aid -of - construction, PG&E shall cooperate reasonably with the NCPA Party in supporting its filing with the Internal Revenue Service. C.1.4 The NCPA Party shall have the right pursuant to Section 14 of this Agreement to audit the supporting documents upon which PG&E bases its estimate of the Cost of work and actual work performed to be advanced by the NCPA Party pursuant to the Transmission Facilities Agreement, as well as documents that show the actual Cost incurred by PG&E. C.2 ASSOCIATED FERC FILINGS 75 If required by FERC or requested by an NCPA Party, PG&E shall file, or at its election may file, with FERC a Transmission Facilities Agreement to document and seek approval of any Cost charged by PG&E to an NCPA Party associated with any facility Modifications, changes, reinforcements or advances contemplated by this Agreement. A NCPA Party shall support this filing by an appropriate submittal to FERC stating its agreement with the charges; provided, that if the Parties are unable to agree on the need or design for an Upgrade Facility or the Cost of an Upgrade Facility or the amount thereof an NCPA Party shall be responsible for, the NCPA Parties may oppose such PG&E filing. C.3 LIMITATIONS ON RESPONSIBILITY FOR UPGRADE COSTS C.3.1 No Double Collection PG&E may not charge an NCPA Party for any Costs associated with Upgrade Facilities that have already been or will be collected through rates paid by PG&E retail or wholesale customers or from a Third Party; provided, that this Section shall not preclude PG&E charging an NCPA Party where refunds are made to those who originally paid for such Costs. 76 APPENDIX D BILLING AND PAYMENT The NCPA Parties shall pay PG&E Costs owed pursuant to this Agreement at: Pacific Gas and Electric Company Payment Processing Center Research Unit / 135A P.O. Box 770000 San Francisco, CA 94177 PG&E may change the place where payment is made by giving the NCPA Parties notice thereof as provided in Section 31. PG&E shall pay NCPA or an NCPA Member Customer Costs owed pursuant to this Agreement at a place to be named by NCPA or an NCPA Member Customer. D.1 PG&E shall prepare and submit bills to an NCPA Party on or after the first business day of each calendar month. The payment of any bill shall be due and must be received by PG&E not later than the 30th calendar day following the day on which NCPA receives the bill. Such date shall be referred to as the "Payment Due Date". If the Payment Due Date falls on a Saturday, Sunday or legal holiday, then payment shall be due the next business day. Such date shall be referred to as the Payment Due Date. A bill shall be deemed delivered on the third business day after the postmarked date unless a copy of the bill is sent by electronic facsimile, in which case it shall be deemed delivered on the same day. D.2 If charges under this Agreement cannot be determined accurately for preparing a bill, PG&E may use its best estimates in preparing the bill and such estimated bill shall be paid by the NCPA Parties. Any estimated charges shall be labeled as such and PG&E shall, upon request, document the basis for the estimate used. Estimated bills shall be prepared and paid in the same manner as other bills under this Agreement. D.3 If an NCPA Party disputes all or any portion of a bill submitted to it by PG&E, it nevertheless shall, not later than the Payment Due Date of that bill, pay the bill in full. A dispute between a Party and any Third Party shall not be a proper basis for withholding payment. Payments to PG&E of the NCPA Party's obligations arising under this Agreement are not subject 77 to any reduction, whether by offset, payments into escrow, or otherwise, except for routine adjustments or corrections as may be agreed to by the Parties or as expressly provided in this Agreement. DA When final and complete billing information becomes available and a charge is determined accurately or billing errors are identified and corrected, PG&E shall promptly prepare and submit an adjusted bill to an NCPA Parry, and any additional payments by an NCPA Party shall be made in accordance with the provisions of this Appendix D. Refunds by PG&E shall be paid to the affected NCPA Party not later than thirty (30) calendar days after the date of the adjusted bill. All adjustments or corrections of bills under this Agreement shall be subject to the interest provisions of Appendix D, Sections 5 and 6. D.5 Interest on an additional payment shall accrue from the Payment Due Date of the applicable bill and interest on a refund shall accrue from the date payment of the applicable bill was received by PG&E. D.6 Any amount due under this Agreement which is not timely paid shall accrue interest from the date prescribed in Appendix D, Section 5 until the date payment is made. The interest amount shall be determined using the interest rate applicable to any amount due during a given month and shall be calculated using the methodology for refunds pursuant to Section 35.19(a) of FERC's Regulations, 18 C.F.R § 35.19(a). This interest rate shall not exceed the maximum interest rate permitted under California law. Interest shall be calculated for the period that the payment is overdue or the period during which the refund is accruing interest. D.7 As provided in Appendix D, Section 3, if any portion of a bill is disputed, the disputing Party shall pay the full amount, without offset or reduction, by the Payment Due Date, however, a Party can challenge the accuracy of a bill even if no dispute was identified prior to the Party's payment of the bill and such right to dispute a bill shall extend to the end of the statutory period of limitations. In addition, the disputing Party shall, on or before the Payment Due Date, notify PG&E, in writing, of the amount in dispute and the specific basis for the dispute. The Parties shall endeavor to resolve any billing dispute within thirty (30) calendar days of PG&E's receipt of the disputing Party's notice of a dispute (or such extended period as the W Parties may establish). If the Parties cannot agree, any Party may initiate dispute resolution pursuant to Section 22. D.8 If, after a disputing Party has paid the full amount of a disputed bill directly to PG&E, the results of dispute resolution pursuant to Section 22 include a determination that the amount due was different than the amount paid by the disputing Party, a refund by PG&E to the disputing Party shall include interest for the period from the date the disputing Party's overpayment was received by PG&E to the date the refund is paid to the disputing Party. Likewise, an additional payment by the disputing Party to PG&E shall include interest for the period from the original Payment Due Date to the date the disputing Party's additional payment is received by PG&E. Interest paid pursuant to this Appendix D, Section 8 shall be at the rate determined pursuant to Appendix D, Section 6. D.9 A Party's failure to make any payment on or before the applicable Payment Due Date shall constitute a material breach of this Agreement if that failure is not corrected within seven (7) business days after the other Party delivers written notice to non-paying Party. In such event, the Party not receiving payment shall be entitled to pursue any legal, equitable and regulatory rights and remedies it may have under this Agreement or otherwise. 61 APPENDIX E OPERATIONAL COORDINATION The Parties will perform operational coordination obligations and responsibilities, which consist of but are not limited to the following: E.1 Maintenance Coordination The Parties shall coordinate, in conformance with their obligations to the Balancing Authority on an annual basis, any planned maintenance outages of transmission facilities of their respective Electric Systems that may reasonably be expected to have a material impact on another Party's Electric System. E.2 Underfrequency Load Shedding (UFLS) Each year after the Planning Coordinator allocates automatic underfrequency load shedding ("UFLS") obligations pursuant to Applicable Requirements, PG&E and each NCPA Member Customer shall coordinate UFLS participation for the twelve (12) month period beginning the following July 1 of that year. PG&E and each NCPA Member Customer with NCPA's assistance shall coordinate to determine each NCPA Member Customers' total amount of UFLS responsibility, if any, for that twelve month period ("NCPA Member Customer UFLS Share"). Each NCPA Member Customer's NCPA Member Customer UFLS Share shall be calculated by multiplying the NCPA Member Customer's proportionate share (represented as a percentage) of the total historical coincident peak electric load in the PG&E service area, for the prior twelve (12) month period as of the date and time specified by the Planning Coordinator, by the total amount of UFLS requirement allocated by the Planning Coordinator to PG&E, acting as the Transmission Operator. Within thirty days after the Planning Coordinator allocates UFLS obligations, PG&E and each NCPA Member Customer shall coordinate to determine how each NCPA Member Customer shall provide UFLS to meet its NCPA Member Customer UFLS Share requirement. Each NCPA Member Customer shall be responsible for ensuring that it has implemented any necessary changes to its underfrequency relay or other relay equipment as necessary to ensure that it is enabled to provide its NCPA Member Customer UFLS Share by July 1 of each calendar U.1 year, pursuant to Applicable Requirements. Each NCPA Member Customer shall be responsible for ensuring that it maintains equipment necessary for the purpose of UFLS, in conformance with Applicable Requirements. If a NCPA Member Customer fails to meet any requirement of this Section E.2, PG&E reserves the right to take any measure necessary to satisfy the NCPA Member Customer's NCPA Member Customer UFLS Share, including but not limited to, implementing automatic load shedding to shed or interrupt some or all load of the NCPA Member Customer. If at any time PG&E does not require any (one or more) NCPA Member Customer to meet its NCPA Member Customer UFLS Share requirement, this shall not waive or excuse any NCPA Member Customer's obligation to satisfy its NCPA Member Customer UFLS Share requirement in that year or at any future date. And any action PG&E takes to satisfy any NCPA Member Customer's NCPA Member Customer UFLS Share at any time shall not create a precedent or obligation that PG&E must take the same or a similar measure in the future. Notwithstanding any provision of this Interconnection Agreement, including Section 26, if a NCPA Member Customer fails to meet any requirements of this Section E.2, and if PG&E is assessed any financial penalties by the CAISO, WECC, NERC, FERC, or any other applicable authority as a result of such failure to meet Applicable Requirements, the applicable NCPA Member Customer shall be responsible for compensating PG&E for the share of the financial penalties directly attributable to the NCPA Member Customer's failure under this Section E.2. E.3 Manual Load Shedding The Parties shall maintain equipment for the purpose of manual load shedding programs in coordination with Applicable Requirements and the Balancing Authority as system conditions warrant. EA Load Restoration The Parties shall, in conformance with Applicable Requirements and their obligations to the Balancing Authority, coordinate the restoration of load following a system disturbance, and agree to do so in coordination with the Balancing Authority when required. M E.5 Reactive Power As between PG&E and each NCPA Member Customer, both Parties shall maintain reactive power flow on each of their Electric Systems so that the sum of the reactive flows at the transmission Point(s) of Interconnection between PG&E and that NCPA Member Customer is within the power factor band of 0.97 lag and 0.99 lead. Both Parties will normally operate their respective systems to minimize War exchange between them. Operating conditions may require larger than normal War exchange between both Parties, and any such exchange will be done in accordance with Good Utility Practice and Applicable Requirements. RESOLUTION NO. 2015-110 A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE CITY MANAGER TO EXECUTE THE PACIFIC GAS AND ELECTRIC COMPANY INTERCONNECTION AGREEMENT ------------------------------------------------------------------- ------------------------------------------------------------------- WHEREAS, the Northern California Power Agency (NCPA), Pacific Gas and Electric (PG&E), and the Cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Palo Alto, Ukiah, and Plumas Sierra Rural Electric Cooperative are parties to Service Agreement No. 17 under the PG&E Federal Energy Regulatory Commission (FERC) Electric Tariff Volume No. 5 (Interconnection Agreement); and WHEREAS, the Interconnection Agreement contains the terms and conditions under which the parties coordinate operations of the electrical interconnections between their respective electric systems; and WHEREAS, the Interconnection Agreement became effective on September 1, 2002, and is set to expire on October 31, 2015; and WHEREAS, the Interconnection Agreement contains the terms and conditions under which each of the NCPA Member Customer Points of Interconnection will be operated in coordination with PG&E; and WHEREAS, the Interconnection Agreement also contains several appendices identifying specific procedures associated with dispute resolution and arbitration, requirements for installation of upgraded facilities, billing and payment instructions, and operational coordination requirements — including Underfrequency Load Shedding obligations; and WHEREAS, while all of the Points of Interconnection covered under the Interconnection Agreement are owned and operated by the NCPA Member Customers, NCPA is a signatory to the Interconnection Agreement due to its role as the NCPA Member Customers' portfolio manager and NCPA shall provide support services to the NCPA Member Customers, including, but not limited to, assisting NCPA Member Customers in performing impact studies and resolving disputes with PG&E; and WHEREAS, the Interconnection Agreement will become effective on November 1, 2015; will have a term of 10 years; and NCPA, PG&E, and each NCPA Member Customer will be a signatory to the Interconnection Agreement; and WHEREAS, on June 24, 2015, the Risk Oversight Committee received a report on this -agenda item and recommends City Council approval. NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby authorize the City Manager to execute the Pacific Gas and Electric Company Interconnection Agreement on behalf of the City of Lodi. Dated: July 15, 2015 --------------------------------------------------- I hereby certify that Resolution No. 2015-110 was passed and adopted by the City Council of the City of Lodi in a regular meeting held July 15, 2015, by the following vote: AYES: COUNCIL MEMBERS — Chandler, Kuehne, Mounce, Nakanishi, and Mayor Johnson NOES: COUNCIL MEMBERS — None ABSENT: COUNCIL MEMBERS — None ABSTAIN: COUNCIL MEMBERS — None J IFER IW FERRAIOLO City Clerk 2015-110