Open Access Transmission Service Tariff

DEPARTMENT OF ENERGY

Western Area Power Administration

Open Access Transmission Service Tariff

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of proposed tariff.

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SUMMARY: The Western Area Power Administration (Western) is proposing

to adopt this Open Access Transmission Service Tariff (Tariff) in order

to be consistent with the Federal Energy Regulatory Commission (FERC)

Orders 888 and 888-A to the extent practicable and consistent with laws

applicable to Western's activities.

DATES: The comment period on the proposed Tariff will begin with the

publication of this notice in the Federal Register and will end October

27, 1997. To be assured of consideration, all written comments must be

received by the end of the comment period. Western will hold a combined

public information and public comment forum on the proposed Tariff

beginning at 1 p.m., October 7, 1997.

ADDRESSES: The combined public information and public comment forum

will be held at the Stapleton Plaza Hotel, 3333 Quebec Street, Denver,

Colorado.

All written comments regarding this proposed Tariff should be

directed to the following address: Mr. Robert C. Fullerton, A0600,

Corporate Communications, Western Area Power Administration, 1627 Cole

Boulevard, P.O. Box 3402, Golden, CO 80401-0098, Electronic Mail:

[email protected] Facsimile: (303) 275-1290.

FOR FURTHER INFORMATION CONTACT:

Mr. Robert J. Harris, Power Marketing Manager, Upper Great Plains

Region, Western Area Power Administration, P.O. Box 35800, Billings, MT

59107-5800, (406) 247-7394

[[Page 50573]]

Mr. Dave Sabo, CRSP Manager, CRSP Customer Service Center, Western Area

Power Administration, P.O. Box 11606, Salt Lake City, UT 84147-0606,

(801) 524-5493

Mr. Anthony H. Montoya, Power Marketing Manager, Desert Southwest

Region, Western Area Power Administration, P.O. Box 6457, Phoenix, AZ

85005-6457, (602) 352-2789

Mr. James D. Keselburg, Power Marketing Manager, Rocky Mountain Region,

Western Area Power Administration, P.O. Box 3700, Loveland, CO 80539-

3003, (970) 490-7370

Ms. Zola Jackson, Power Marketing Manager, Sierra Nevada Region,

Western Area Power Administration, 114 Parkshore Drive, Folsom, CA

95630-4710, (916) 353-4421.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Procedures

II. Background

III. Issues Raised During the Development of this Proposed Tariff

IV. Summary of Changes from the FERC Pro Forma Tariff

V. Coordination with Adoption of Open Access Transmission Rates

I. Procedures

After all public comments have been considered, Western will

prepare a final Tariff and publish it in the Federal Register. Western

will submit the final Tariff to FERC under a nonjurisdictional docket

and will request a declaratory order that the Tariff meets FERC

comparability standards as set forth in FERC Orders 888 and 888-A.

Western will make necessary changes in response to the FERC declaratory

order and further comments and will then publish the revised final

Tariff in the Federal Register.

II. Background

Western was established pursuant to Section 302 of the Department

of Energy (DOE) Organization Act, Public Law 95-91, dated August 4,

1977. Western is generally a partial requirements power supplier that

markets and transmits Federal electric power in 15 central and western

States encompassing a geographic area of 3.38 million-square-kilometers

(1.3 million-square-miles). Western has four Regional Offices and one

Customer Service Center which market and transmit power generated by

various Federal projects. Nothing in the proposed Tariff is intended to

alter, amend, or abridge the statutory obligations of Western to market

Federal power and to repay the Federal investment in those Federal

projects.

FERC issued a Notice of Proposed Rulemaking (NOPR) for Open Access

Transmission Service, published at 60 FR 17662, on April 7, 1995. On

October 4, 1995, the Secretary of the Department of Energy (DOE)

adopted a Power Marketing Administration Open Access Transmission

Policy which stated that DOE supported the spirit and intent of the

NOPR and directed the Power Marketing Administrations to prepare

tariffs which would conform to the principles set forth in the FERC's

final rule. FERC issued its final rule, Order 888, published at 61 FR

21540 on May 10, 1996, and followed with Order 888-A, published at 62

FR 12273, on March 14, 1997.

In early 1996, Western began developing a Tariff Equivalent Package

(TEP) to comply with the Secretary's directive. A draft TEP, which was

designed as a Western-wide document that would contain Region-specific

rates and charges, was completed in July 1996 and sent to Western's

electric service customers, transmission-service customers, and other

interested parties for review and comment. Western accepted comments

through November 1996.

After evaluating comments, Western modified its original concept of

preparing a Western-wide TEP and began developing Regional Open Access

Transmission Service Guidelines (Regional Guidelines). These Regional

Guidelines contained service agreements consistent with the specific

conditions applicable to each Region. The resulting documents were sent

to electric service customers, transmission customers, and other

interested parties for review and comment in April 1997. The review

period for those documents ended in early June 1997. To date, customer

and interested party participation has been conducted informally.

Western will submit a single Tariff document to FERC under a

nonjurisdictional docket and request a declaratory order from FERC that

the Tariff meets the FERC comparability standards as set forth in FERC

Orders 888 and 888-A. Consistent with a single FERC filing, Western

decided to develop and file this single Tariff with appended schedules

and attachments. Western's Tariff includes Attachment J, Provisions

Specific to the Transmission Provider, and Attachment K, Authorities

and Obligations, which are specific to Western and are not found in

FERC Order 888-A, Exhibit B, Pro Forma Tariff.

III. Issues Raised During the Development of This Proposed Tariff

Participants in the informal review process raised numerous issues

about both versions of the draft documents. The following discussion

highlights the more significant issues and Western's responses as

incorporated into this proposed Tariff.

A. Issue: There is concern that some of Western's Regional Offices

may not offer Network Integration Transmission Service, hereafter

called network service, at this time. Some think that not providing

network service would probably mean that the Tariff would be of little

value to all existing transmission customers. They think this would

raise significant comparability issues since the service Western

provides itself is network service.

Response: In most cases, the service Western provides to its firm

power customers is not exactly network or point-to-point service.

Western will offer network service subject to available transfer

capability determined considering operating constraints, facility

limitations, and existing contractual obligations.

B. Issue: Some of Western's customers have expressed concern that

the combination of the network service provisions and the definitions

provided in Western's Tariff result in transmission being paid for both

as part of Western's power rates and again under Western's Tariff. The

Tariff does not clearly describe how this would be eliminated. A

Western customer's load and/or resources should be reduced to account

for Western's power contract commitment to the customer. Similarly, the

definition of Network Customer should include the possibility that a

Network Customer may also be a Federal customer as defined in

Attachment K.

Response: FERC recognized that existing power and transmission

arrangements represent a transitional problem as customers begin to

take service under the Pro Forma Tariff. FERC did not intend, nor does

Western, for a transmission provider to receive two payments for

providing service to the same portion of a transmission customer's

load. The current definition of Network Customer does not exclude the

possibility that a Network Customer may also be a Federal customer.

C. Issue: Some of Western's customers encouraged Western to reserve

its transmission capability to serve future load growth needs of its

customers, including direct-service customers. Some of Western's firm

power customers also requested that Western

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identify its allocations to customers as Native Load in the Tariff.

Response: Western's customers with point-to-point transmission

service may request increased reservations of point-to-point

transmission to accommodate specified amounts of anticipated load

growth of the customer. Where Western is able to provide network

service, Western intends to meet anticipated load growth; however,

Western's ability to construct additional transmission facilities to

accommodate Network Customer load growth may be limited by

appropriations or advance customer funding. Western will adhere to the

transmission procedures set forth in its final Tariff for all requests

for transmission service. Western has defined firm power and project

use customers as Federal customers in Attachment K to the Tariff and

will treat them in a manner analogous to the treatment of Native Load

Customers of public utilities.

D. Issue: Why does Western require advancement of funds?

Response: Under present legislation, Western cannot use

appropriated funds to do work for others and is prohibited from

entering into contracts that obligate it to spend funds it does not

have.

E. Issue: Western should be proposing service only over Federal

facilities. Western should not allow stranded cost recovery for non-

Federal facilities.

Response: Each Western Regional Office will design rates to include

the facilities used to provide transmission service under the Tariff.

The transmission system description may be modified in the Tariff to

correspond with results of some rate making processes. The terms of the

Tariff will allow stranded cost recovery when appropriate and

consistent with applicable Federal law.

F. Issue: Why cannot Western provide service without a contract?

Response: Western believes that the Pro Forma language, as modified

in Western's Tariff, provides adequate protection and is willing to

provide service without an executed Service Agreement in accordance

with the terms of sections 1.45, 15.3 and 29.1. These sections require

the Transmission customer to agree to abide by the Tariff terms and the

existing transmission rates. The Transmission Customer may also request

resolution under the provisions of Section 12, Dispute Resolution, of

the Tariff.

G. Issue: What process will Western use for future changes to the

Tariff?

Response: Western is providing notice of this proposal and an

opportunity to comment. The proposal may then be modified after

considering the comments received. Western will submit the final Tariff

to FERC under a nonjurisdictional docket and request a declaratory

order from FERC that the final Tariff meets FERC comparability

standards as set forth in FERC Orders 888 and 888-A. Interested parties

will have an opportunity to comment on the Tariff by following

appropriate procedures to intervene with FERC. Western will make

necessary changes in response to the FERC declaratory order and further

comments and will then publish the final revised Tariff in the Federal

Register.

H. Issue: Some of Western's customers believe that Western has a

statutory obligation to deliver power to its firm power customers and

therefore, should not they have a superior right? How will Western

address ``comparability'' issues?

Response: Service to be provided under the Tariff will not conflict

with any of Western's statutory obligations. There will be no need to

give Western's Federal customers a superior right to transmission since

adequate capacity will be reserved for the long-term delivery of the

Federal power through Western's process in determining its Available

Transfer Capability (ATC), which requires consideration of various

hydrological conditions and also considers the possible integration of

thermal or other generation sources. If there is additional capacity

above Western's needs for use by others, Western will make that

capacity available under the Tariff. This will ensure adequate long-

term transmission capacity for Federal purposes as well as allowing

Western the ability to provide comparable service to others.

I. Issue: Does Western intend that an entity seeking transmission

service across the entire Western system would need to have a service

agreement with each Western Regional Office and pay individual rates

for use of each office's system, leading to a pancaking of rates?

Response: More than one service agreement may be needed if an

entity wants service across the transmission facilities of more than

one project. Although a Regional Office may have responsibility for

more than one Project Transmission System, each Project has its own

separate transmission system and its own repayment obligation for that

specific system.

IV. Summary of Changes From the FERC Pro Forma Tariff

Western's proposed Tariff has 11 differences from the Pro Forma

Tariff that can be grouped into four major categories: Preservation of

Obligations, FERC Jurisdictional Issues, Financial Considerations, and

Legal Issues.

A. Preservation of Obligations

i. Transmission Provider and Transmission System

Western operates, manages, and has repayment responsibilities for

several independent transmission systems. Each system is managed as an

independent financial entity with discrete repayment responsibilities

under Federal statutes authorizing the individual transmission systems.

A Service Agreement for use of one system's facilities and payment of

one system's rate may not permit a transmission customer to use the

facilities of another system. There is no single Western-wide

transmission system or transmission rate. Each system is described in

Attachment K (Authorities and Obligations) to the proposed Tariff. The

definitions of Transmission Provider in Section 1.46 and Transmission

System in Section 1.49 are modified to recognize the independent nature

of the transmission facilities.

ii. Losses

Sections 15.7 and 28.5 of the Pro Forma Tariff are modified to

allow the applicable transmission losses percentages to be included in

the Region-specific Service Agreements. Western's Regional Offices

frequently modify transmission loss factors based on actual system

losses. Including losses in the Service Agreement provides a more

efficient means of modifying losses than modifying the Tariff.

Additionally, since Western has developed a Western-wide Tariff

applicable to all Regional Offices, including losses in the Service

Agreements is more appropriate.

iii. Federal Customers

Western markets generation to customers that are entitled by law to

receive preference in the sale of Federal power, as opposed to

jurisdictional public utilities that serve load requirements in a

geographical area. Western will treat preference customers in a manner

analogous to Native Load Customers of public utilities as defined in

the Pro Forma Tariff. Attachment K defines these Federal Customers.

iv. Ancillary Services

Section 3 of the proposed Tariff is modified to include the option

for Western to purchase Ancillary Services and pass through such costs

to the Transmission Customer. Western's hydroelectric power facilities

have limited capability to provide some Ancillary Services, due to

variable

[[Page 50575]]

hydrological conditions and environmental and operational constraints.

The existing long-term hydrological capability is allocated and under

contract to Federal Customers in accordance with the preference

provisions of Federal law.

B. FERC Jurisdictional Issues

Since Western is not a jurisdictional public utility, the Tariff

does not include reference to FERC approval of rates or service

agreements. Western does not file its rates or contracts under Section

205 and Section 206 of the Federal Power Act. Western's rates are

developed pursuant to Federal law, under public information and comment

procedures, that specify FERC's role in reviewing Power Marketing

Administration rates. Appropriate modifications reflecting Western's

rate setting process were made to Sections 1.10, 2.2, 9, 12.1, 13.3,

14.3, 20.3, 26, 27, 34, 34.5.

Western does not file executed service agreements with FERC or seek

FERC approval to terminate service. Appropriate modifications are made

to Sections 1.45, 7.3, 13.4, 14.4, 15.3, 17.6, 19.3, 19.4, 29.1, 29.5,

32.3, and 32.4 to reflect Western's status as a nonjurisdictional

utility.

C. Financial Considerations

i. Deposits for Transmission Service and Interest

Western's current financial system and procedures make collecting

and refunding deposits unduly burdensome. Western has replaced

provisions for collecting deposits with Completed Applications and

returning such deposits with interest under certain circumstances with

language that allows Western to assess a nondiscriminatory, non-

refundable application processing fee for all Transmission Service

requests. The processing fee reflects an average of staff wages and

benefits multiplied by the average time it takes to analyze and respond

to requests for service. FERC has found in other nonjurisdictional

tariffs that such an approach represents an administratively simple

alternative to the Pro Forma language. Also, Western will not pay

interest on deposits for studies or construction. Although Western may,

by contract, pay interest, Western cannot earn interest on funds

deposited into the U.S. Treasury. Western has also investigated escrow

accounts at commercial financial institutions and found that

administrative costs generally exceeded interest payments. Paying

interest on deposits would result in other ratepayers funding this

expense. Western does not believe this is an equitable method and will

not pay interest. Appropriate modifications are made to Sections 1.5,

17.3, 17.4, 17.6, 19.1, 19.4, 20.3, 22.2, 29.2, 32.1, 32.2, and 32.4.

ii. Advance Payment

There are several sections in the Pro Forma Tariff that require the

Transmission Provider to perform activities with reimbursement by the

Transmission Customer. Except for certain activities with other Federal

agencies, Western normally requires advance of funds to perform work

rather than receiving a reimbursement. Western is funded through

Congressional appropriations. The Anti-Deficiency Act and other

appropriations laws generally prohibit Federal agencies from expending

funds without having adequate funds in the Treasury and from expending

appropriations for purposes other than those for which Congress

appropriated the funds. Modifications are made to Sections 13.5, 15.4,

19.1, 19.2, 19.4, 19.8, 20.3, 23.2, 28.2, 31.5, 32.1, and 32.4.

iii. Net Billing and Bill Crediting

Western's proposed Tariff uses the Pro Forma Tariff language in

Section 7 (Billing and Payment). In addition, two provisions in

Attachment J provide for Net Billing and Bill Crediting. Net Billing

and Bill Crediting are two alternative financing mechanisms that

Western has a long-standing history of using. The Net Billing language

provides that charges for generation will not be offset with

transmission charges without mutual agreement. To be as consistent as

possible with the Pro Forma Tariff language, Western included these

Western-specific provisions in Attachment J.

D. Legal Issues

Western has adopted the Force Majeure language of the Pro Forma

Tariff. Western has added language assuring that both parties to a

contract will provide each other with written notice of any Force

Majeure and exercise due diligence in resolving the problem. Western

used the Pro Forma Tariff language for Indemnification with the

addition of a sentence to reflect the fact that Western's liability is

limited under Federal law and is determined in accordance with the

Federal Tort Claims Act. Appropriate modifications are made to Section

10.

i. Dispute Resolution

Western modified the dispute resolution provisions to recognize the

limits to Western's statutory and regulatory authority to submit

disputes to arbitration consistent with the Administrative Dispute

Resolution Act. Appropriate modifications are made to Section 12.

ii. Western-Specific Provisions

In Attachment J to the Tariff, Western incorporated several

provisions specific to Western, as a Federal agency. Section 1, Change

of Rates, provides for Western to change rates under the Schedules in

accordance with appropriate rate adjustment procedures and other

applicable Federal laws. This provision also provides an option for

transmission customers to terminate service within 90 days after the

effective date of a rate change. This language is necessary because

Western does not file its rate adjustments with FERC under the Federal

Power Act like jurisdictional public utilities. FERC's review of

Western's rates is provided under a different body of Federal law.

Section 2, Contingent Upon Appropriations, is required by Federal

law to be included in Federal contracts that will extend beyond the

current fiscal year. Section 3, Covenant Against Contingent Fees;

Section 4, Contract Work Hours and Safety Standards; Section 5, Equal

Opportunity Employment Practices; and Section 6, Use of Convict Labor,

are contract sections that are required by Federal law to be included

in all Federal contracts.

Section 7, Independent System Operator (ISO), recognizes that

Western is involved with the development of several independent system

operator (ISO) organizations and that the final Tariff may need

modifications as a result of a Western Regional Office joining an ISO.

Section 8 provides that the final Tariff does not grant any rights

to any Third Parties who are not a party to the Service Agreement.

Section 9, Entire Agreement, provides that the Service Agreement and

Tariff are the entire understanding between Western and the

Transmission Customer. Section 10, Power Supply Obligations, provides

that Western is not obligated to supply capacity and energy from

Federal generation sources during Interruptions or Curtailments other

than through the provisions of Operating Reserve Service and emergency

power. Generally, Federal generation is completely allocated and under

contract on a long-term basis to customers entitled to preference under

Federal law and may not be available for support of Transmission

Service.

Section 11, Federal Law, provides that the performance under the

Tariff and Service Agreement shall be governed by

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applicable Federal law. This avoids disputes concerning state law and

Federal sovereignty. There may be other sections of the Tariff where

there may be potential conflicts between laws under which Western must

operate and FERC policy, such as Sections 27 and 31.2. Section 12,

Continuing Obligations, provides that obligations to make payments

survive termination of the Service Agreement until satisfied. Section

13, Net Billing, and Section 14, Bill Crediting, are discussed above.

V. Coordination With Adoption of Open Access Transmission Rates

Each of Western's Regional Offices is at a different point in the

process of developing Open Access Transmission Rates. DOE approval of

Western's rates is addressed in DOE Delegation Order No. 0204-108.

Western's procedures for public involvement for rate procedures are

covered in 10 CFR Part 903. Filing requirements and procedures for FERC

review of Power Marketing Administration rates are detailed in 18 CFR

Part 300. Until the Regional Offices complete the processes of placing

long-term rates in effect for the services to be provided under the

open-access tariff, they will use existing long-term rates when

applicable. Short-term rates may be placed in effect by Western's

Administrator and used when no rates exist for such services. Once the

long-term rates are in effect, they will supersede the short-term

rates.

The Sierra Nevada Region's (SNR) new rates for ancillary services

and transmission are proposed to become effective October 1, 1997, and

to be effective for a 5-year period ending September 30, 2002. The

proposed rate adjustment was initiated on May 5, 1996, and four

informal customer workshops were held. A Federal Register notice was

published on March 4, 1997 (62 FR 9763), officially announcing the

proposed rates, initiating the public consultation and comment period,

and announcing the public information and public comment forums. The

Federal Register notice was sent to all Central Valley Project

preference customers and interested parties, and a public information

and a public comment forum were held.

The Colorado River Storage Project Customer Service Center (CRSP

CSC) is currently conducting a public process to develop transmission

and ancillary service rates consistent with FERC Orders 888 and 888-A

to be used with its Tariff. The public comment period will conclude

September 23, 1997. The proposed effective date of the rates will be

April 1, 1998.

The Desert Southwest Region will begin a formal public involvement

process in September 1997 to develop transmission and ancillary service

rates consistent with FERC Orders 888 and 888-A to be used with the

Tariff. The proposed effective date of the rates will be April 1, 1998.

The Upper Great Plains Region (UGPR) has implemented short-term

Open Access Transmission Rates approved by Western's Administrator.

These transmission rates and ancillary service rates became effective

December 20, 1996, and will expire December 19, 1997. On March 28,

1997, by the mailing of an Advance Announcement of the transmission

rate adjustment for the Pick-Sloan Missouri Basin Program, Eastern

Division, a public process was initiated to establish long-term Open

Access Transmission Rates for the UGPR. UGPR has received comments from

that announcement and published its proposal in September 1997. The

proposed effective date is February 1, 1998.

The Rocky Mountain Region (RMR) will begin a formal public

involvement process in September 1997 to develop transmission and

ancillary service rates consistent with FERC Orders 888 and 888-A to be

used with the Tariff. The proposed effective date of the rates will be

April 1, 1998.

Subsequent changes to Regional Office Open Access Transmission

rates will be completed on a project-by-project basis using the public

involvement and FERC review processes outlined above.

Review Under Executive Order 12866

Western has an exemption from centralized regulatory review under

Executive Order 12866; accordingly, no clearance of this notice by the

Office of Management and Budget (OMB) is required.

Regulatory Flexibility Analysis

Pursuant to the Regulatory Flexibility Act of 1980 (5 U.S.C. 601,

et seq.), each agency, when required by 5 U.S.C. 553 to publish a

proposed rule, is further required to prepare and make available for

public comment an initial regulatory flexibility analysis to describe

the impact of the proposed rule on small entities. The Acting

Administrator for Western certifies that Western's providing open

transmission access would not cause an adverse economic impact on a

substantial number of such entities. Since the proposed open-access

tariff is of limited applicability, no flexibility analysis is

required.

Review Under the Paperwork Reduction Act

In accordance with the Paperwork Reduction Act of 1980, 44 U.S.C.

3501-3520, Western has received approval from OMB for the collection of

information in this rule under OMB control number 1910-0100.

Review Under the National Environmental Policy Act

Western will comply with the National Environmental Policy Act of

1969 (42 U.S.C. 4321 et seq.), the Council on Environmental Quality

Regulations (40 CFR Parts 1500-1508), and the DOE NEPA Implementing

Procedures (10 CFR Part 1021) prior to adopting the Tariff.

AVAILABILITY OF INFORMATION: A redline/strikeout comparison of

Western's proposed Tariff to the FERC Pro Forma will be available from

the informational contacts listed previously or on the Internet at

http://www.wapa.gov.

Dated: September 17, 1997.

Michael S. Hacskaylo,

Acting Administrator.

Table of Contents

Part I. Common Service Provisions

1 Definitions

1.1 Ancillary Services

1.2 Annual Transmission Costs

1.3 Application

1.4 Commission

1.5 Completed Application

1.6 Control Area

1.7 Curtailment

1.8 Delivering Party

1.9 Designated Agent

1.10 Direct Assignment Facilities

1.11 Eligible Customer

1.12 Facilities Study

1.13 Firm Point-To-Point Transmission Service

1.14 Good Utility Practice

1.15 Interruption

1.16 Load Ratio Share

1.17 Load Shedding

1.18 Long-Term Firm Point-To-Point Transmission Service

1.19 Native Load Customers

1.20 Network Customer

1.21 Network Integration Transmission Service

1.22 Network Load

1.23 Network Operating Agreement

1.24 Network Operating Committee

1.25 Network Resource

1.26 Network Upgrades

1.27 Non-Firm Point-To-Point Transmission Service

1.28 Open Access Same-Time Information System

1.29 Part I

1.30 Part II

1.31 Part III

1.32 Parties

1.33 Point(s) of Delivery

1.34 Point(s) of Receipt

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1.35 Point-To-Point Transmission Service

1.36 Power Purchaser

1.37 Receiving Party

1.38 Regional Transmission Group

1.39 Reserved Capacity

1.40 Service Agreement

1.41 Service Commencement Date

1.42 Short-Term Firm Point-To-Point Transmission Service

1.43 System Impact Study

1.44 Third-Party Sale

1.45 Transmission Customer

1.46 Transmission Provider

1.47 Transmission Provider's Monthly Transmission System Peak

1.48 Transmission Service

1.49 Transmission System

2 Initial Allocation and Renewal Procedures

2.1 Initial Allocation of Available Transmission Capability

2.2 Reservation Priority For Existing Firm Service Customers

3 Ancillary Services

3.1 Scheduling, System Control and Dispatch Service

3.2 Reactive Supply and Voltage Control from Generation Sources

Service

3.3 Regulation and Frequency Response Service

3.4 Energy Imbalance Service

3.5 Operating Reserve--Spinning Reserve Service

3.6 Operating Reserve--Supplemental Reserve Service

4 Open Access Same-Time Information System (OASIS)

5 Local Furnishing Bonds

5.1 Transmission Providers That Own Facilities Financed by

Local Furnishing Bonds

5.2 Alternative Procedures for Requesting Transmission Service

6 Reciprocity

7 Billing and Payment

7.1 Billing Procedures

7.2 Interest on Unpaid Balances

7.3 Customer Default

8 Accounting for the Transmission Provider's Use of the Tariff

8.1 Transmission Revenues

8.2 Study Costs and Revenues

9 Regulatory Filings

10 Force Majeure and Indemnification

10.1 Force Majeure

10.2 Indemnification

11 Creditworthiness

12 Dispute Resolution Procedures

12.1 Internal Dispute Resolution Procedures

12.2 Disputes

12.3 Rights Under The Federal Power Act

Part II. Point-To-Point Transmission Service

Preamble

13 Nature of Firm Point-To-Point Transmission Service

13.1 Term

13.2 Reservation Priority

13.3 Use of Firm Transmission Service by the Transmission

Provider

13.4 Service Agreements

13.5 Transmission Customer Obligations for Facility Additions

or Redispatch Costs

13.6 Curtailment of Firm Transmission Service

13.7 Classification of Firm Transmission Service

13.8 Scheduling of Firm Point-To-Point Transmission Service

14 Nature of Non-Firm Point-To-Point Transmission Service

14.1 Term

14.2 Reservation Priority

14.3 Use of Non-Firm Point-To-Point Transmission Service by the

Transmission Provider

14.4 Service Agreements

14.5 Classification of Non-Firm Point-To-Point Transmission

Service

14.6 Scheduling of Non-Firm Point-To-Point Transmission Service

14.7 Curtailment or Interruption of Service

15 Service Availability

15.1 General Conditions

15.2 Determination of Available Transmission Capability

15.3 Initiating Service in the Absence of an Executed Service

Agreement

15.4 Obligation to Provide Transmission Service that Requires

Expansion or Modification of the Transmission System

15.5 Deferral of Service

15.6 Other Transmission Service Schedules

15.7 Real Power Losses

16 Transmission Customer Responsibilities

16.1 Conditions Required of Transmission Customers

16.2 Transmission Customer Responsibility for Third-Party

Arrangements

17 Procedures for Arranging Firm Point-To-Point Transmission

Service

17.1 Application

17.2 Completed Application

17.3 Processing Fee

17.4 Notice of Deficient Application

17.5 Response to a Completed Application

17.6 Execution of a Service Agreement

17.7 Extensions for Commencement of Service

18 Procedures for Arranging Non-Firm Point-To-Point Transmission

Service

18.1 Application

18.2 Completed Application

18.3 Reservation of Non-Firm Point-To-Point Transmission

Service

18.4 Determination of Available Transmission Capability

19 Additional Study Procedures For Firm Point-To-Point Transmission

Service Requests

19.1 Notice of Need for System Impact Study

19.2 System Impact Study Agreement and Compensation

19.3 System Impact Study Procedures

19.4 Facilities Study Procedures

19.5 Facilities Study Modifications

19.6 Due Diligence in Completing New Facilities

19.7 Partial Interim Service

19.8 Expedited Procedures for New Facilities

20 Procedures if The Transmission Provider is Unable to Complete

New Transmission Facilities for Firm Point-To-Point Transmission

Service

20.1 Delays in Construction of New Facilities

20.2 Alternatives to the Original Facility Additions

20.3 Refund Obligation for Unfinished Facility Additions

21 Provisions Relating to Transmission Construction and Services on

the Systems of Other Utilities

21.1 Responsibility for Third-Party System Additions

21.2 Coordination of Third-Party System Additions

22 Changes in Service Specifications

22.1 Modifications On a Non-Firm Basis

22.2 Modifications On a Firm Basis

23 Sale or Assignment of Transmission Service

23.1 Procedures for Assignment or Transfer of Service

23.2 Limitations on Assignment or Transfer of Service

23.3 Information on Assignment or Transfer of Service

24 Metering and Power Factor Correction at Receipt and Delivery

Point(s)

24.1 Transmission Customer Obligations

24.2 Transmission Provider Access to Metering Data

24.3 Power Factor

25 Compensation for Transmission Service

26 Stranded Cost Recovery

27 Compensation for New Facilities and Redispatch Costs

Part III. Network Integration Transmission Service

Preamble

28 Nature of Network Integration Transmission Service

28.1 Scope of Service

28.2 Transmission Provider Responsibilities

28.3 Network Integration Transmission Service

28.4 Secondary Service

28.5 Real Power Losses

28.6 Restrictions on Use of Service

29 Initiating Service

29.1 Condition Precedent for Receiving Service

29.2 Application Procedures

29.3 Technical Arrangements to be Completed Prior to

Commencement of Service

29.4 Network Customer Facilities

29.5 This section is intentionally left blank

30 Network Resources

30.1 Designation of Network Resources

30.2 Designation of New Network Resources

30.3 Termination of Network Resources

30.4 Operation of Network Resources

30.5 Network Customer Redispatch Obligation

30.6 Transmission Arrangements for Network Resources Not

Physically Interconnected With The Transmission Provider

30.7 Limitation on Designation of Network Resources

30.8 Use of Interface Capacity by the Network Customer

30.9 Network Customer Owned Transmission Facilities

31 Designation of Network Load

[[Page 50578]]

31.1 Network Load

31.2 New Network Loads Connected With the Transmission Provider

31.3 Network Load Not Physically Interconnected with the

Transmission Provider

31.4 New Interconnection Points

31.5 Changes in Service Requests

31.6 Annual Load and Resource Information Updates

32 Additional Study Procedures For Network Integration Transmission

Service Requests

32.1 Notice of Need for System Impact Study

32.2 System Impact Study Agreement and Compensation

32.3 System Impact Study Procedures

32.4 Facilities Study Procedures

33 Load Shedding and Curtailments

33.1 Procedures

33.2 Transmission Constraints

33.3 Cost Responsibility for Relieving Transmission Constraints

33.4 Curtailments of Scheduled Deliveries

33.5 Allocation of Curtailments

33.6 Load Shedding

33.7 System Reliability

34 Rates and Charges

34.1 Monthly Demand Charge

34.2 Determination of Network Customer's Monthly Network Load

34.3 Determination of Transmission Provider's Monthly

Transmission System Load

34.4 Redispatch Charge

34.5 Stranded Cost Recovery

35 Operating Arrangements

35.1 Operation under The Network Operating Agreement

35.2 Network Operating Agreement

35.3 Network Operating Committee

Schedule 1

Scheduling, System Control and Dispatch Service

Schedule 2

Reactive Supply and Voltage Control from Generation Sources

Service

Schedule 3

Regulation and Frequency Response Service

Schedule 4

Energy Imbalance Service

Schedule 5

Operating Reserve--Spinning Reserve Service

Schedule 6

Operating Reserve--Supplemental Reserve Service

Schedule 7

Long-Term Firm and Short-Term Firm Point-to-Point Transmission

Service

Schedule 8

Non-Firm Point-to-Point Transmission Service

Attachment A

Form of Service Agreement For Firm Point-to-Point Transmission

Service

Attachment B

Form of Service Agreement For Non-Firm Point-to-Point

Transmission Service

Attachment C

Methodology to Assess Available Transmission Capability

Attachment D

Methodology for Completing a System Impact Study

Attachment E

Index of Point-to-Point Transmission Service Customers

Attachment F

Service Agreement For Network Integration Transmission Service

Attachment G

Network Operating Agreement

Attachment H

Annual Transmission Revenue Requirement For Network Integration

Transmission Service

Attachment I

Index of Network Integration Transmission Service Customers

Attachment J

Provisions Specific to the Transmission Provider

Attachment K

Transmission Provider Authorities and Obligations

I. Common Service Provisions

1 Definitions

1.1 Ancillary Services: Those services that are necessary to support

the transmission of capacity and energy from resources to loads while

maintaining reliable operation of the Transmission Provider's

Transmission System in accordance with Good Utility Practice.

1.2 Annual Transmission Costs: The total annual cost of the

Transmission System for purposes of Network Integration Transmission

Service shall be the amount specified in Attachment H until amended by

the Transmission Provider or modified by the Commission, pursuant to

Federal Law.

1.3 Application: A request by an Eligible Customer for transmission

service pursuant to the provisions of the Tariff.

1.4 Commission: The Federal Energy Regulatory Commission.

1.5 Completed Application: An Application that satisfies all of the

information and other requirements of the Tariff, including any

required application processing fee.

1.6 Control Area: An electric power system or combination of electric

power systems to which a common automatic generation control scheme is

applied in order to:

(1) Match, at all times, the power output of the generators within

the electric power system(s) and capacity and energy purchased from

entities outside the electric power system(s), with the load within the

electric power system(s);

(2) Maintain scheduled interchange with other Control Areas, within

the limits of Good Utility Practice;

(3) Maintain the frequency of the electric power system(s) within

reasonable limits in accordance with Good Utility Practice; and

(4) Provide sufficient generating capacity to maintain operating

reserves in accordance with Good Utility Practice.

1.7 Curtailment: A reduction in firm or non-firm transmission service

in response to a transmission capacity shortage as a result of system

reliability conditions.

1.8 Delivering Party: The entity supplying capacity and energy to be

transmitted at Point(s) of Receipt.

1.9 Designated Agent: Any entity that performs actions or functions on

behalf of the Transmission Provider, an Eligible Customer, or the

Transmission Customer required under the Tariff.

1.10 Direct Assignment Facilities: Facilities or portions of

facilities that are constructed by the Transmission Provider for the

sole use/benefit of a particular Transmission Customer requesting

service under the Tariff. Direct Assignment Facilities shall be

specified in the Service Agreement that governs service to the

Transmission Customer.

1.11 Eligible Customer: (i) Any electric utility (including the

Transmission Provider and any power marketer), Federal power marketing

agency, or any person generating electric energy for sale for resale is

an Eligible Customer under the Tariff. Electric energy sold or produced

by such entity may be electric energy produced in the United States,

Canada or Mexico. However, with respect to transmission service that

the Commission is prohibited from ordering by Section 212(h) of the

Federal Power Act, such entity is eligible only if the service is

provided pursuant to a state requirement that the Transmission Provider

offer the unbundled transmission service, or pursuant to a voluntary

offer of such service by the Transmission Provider. (ii) Any retail

customer taking unbundled transmission service pursuant to a state

requirement that the Transmission Provider offer the transmission

service, or pursuant to a voluntary offer of such service by the

Transmission Provider, is an Eligible Customer under the Tariff.

1.12 Facilities Study: An engineering study conducted by the

Transmission Provider to determine the required modifications to the

Transmission Provider's Transmission System, including the cost and

scheduled completion date for such modifications, that will be required

to provide the requested transmission service.

[[Page 50579]]

1.13 Firm Point-To-Point Transmission Service: Transmission Service

under this Tariff that is reserved and/or scheduled between specified

Points of Receipt and Delivery pursuant to Part II of this Tariff.

1.14 Good Utility Practice: Any of the practices, methods and acts

engaged in or approved by a significant portion of the electric utility

industry during the relevant time period, or any of the practices,

methods and acts which, in the exercise of reasonable judgment in light

of the facts known at the time the decision was made, could have been

expected to accomplish the desired result at a reasonable cost

consistent with good business practices, reliability, safety and

expedition. Good Utility Practice is not intended to be limited to the

optimum practice, method, or act to the exclusion of all others, but

rather to be acceptable practices, methods, or acts generally accepted

in the region.

1.15 Interruption: A reduction in non-firm transmission service due to

economic reasons pursuant to Section 14.7.

1.16 Load Ratio Share: Ratio of a Transmission Customer's Network Load

to the Transmission Provider's total load computed in accordance with

Sections 34.2 and 34.3 of the Network Integration Transmission Service

under Part III of the Tariff and calculated on a rolling twelve month

basis.

1.17 Load Shedding: The systematic reduction of system demand by

temporarily decreasing load in response to transmission system or area

capacity shortages, system instability, or voltage control

considerations under Part III of the Tariff.

1.18 Long-Term Firm Point-To-Point Transmission Service: Firm Point-

To-Point Transmission Service under Part II of the Tariff with a term

of one year or more.

1.19 Native Load Customers: The wholesale and retail power customers

of the Transmission Provider on whose behalf the Transmission Provider,

by statute, franchise, regulatory requirement, or contract, has

undertaken an obligation to construct and operate the Transmission

Provider's system to meet the reliable electric needs of such

customers.

1.20 Network Customer: An entity receiving transmission service

pursuant to the terms of the Transmission Provider's Network

Integration Transmission Service under Part III of the Tariff.

1.21 Network Integration Transmission Service: The transmission

service provided under Part III of the Tariff.

1.22 Network Load: The load that a Network Customer designates for

Network Integration Transmission Service under Part III of the Tariff.

The Network Customer's Network Load shall include all load served by

the output of any Network Resources designated by the Network Customer.

A Network Customer may elect to designate less than its total load as

Network Load but may not designate only part of the load at a discrete

Point of Delivery. Where a Eligible Customer has elected not to

designate a particular load at discrete points of delivery as Network

Load, the Eligible Customer is responsible for making separate

arrangements under Part II of the Tariff for any Point-To-Point

Transmission Service that may be necessary for such non-designated

load.

1.23 Network Operating Agreement: An executed agreement that contains

the terms and conditions under which the Network Customer shall operate

its facilities and the technical and operational matters associated

with the implementation of Network Integration Transmission Service

under Part III of the Tariff.

1.24 Network Operating Committee: A group made up of representatives

from the Network Customer(s) and the Transmission Provider established

to coordinate operating criteria and other technical considerations

required for implementation of Network Integration Transmission Service

under Part III of this Tariff.

1.25 Network Resource: Any designated generating resource owned,

purchased, or leased by a Network Customer under the Network

Integration Transmission Service Tariff. Network Resources do not

include any resource, or any portion thereof, that is committed for

sale to third parties or otherwise cannot be called upon to meet the

Network Customer's Network Load on a non-interruptible basis.

1.26 Network Upgrades: Modifications or additions to transmission-

related facilities that are integrated with and support the

Transmission Provider's overall Transmission System for the general

benefit of all users of such Transmission System.

1.27 Non-Firm Point-To-Point Transmission Service: Point-To-Point

Transmission Service under the Tariff that is reserved and scheduled on

an as-available basis and is subject to Curtailment or Interruption as

set forth in Section 14.7 under Part II of the Tariff. Non-Firm Point-

To-Point Transmission Service is available on a stand-alone basis for

periods ranging from one hour to one month.

1.28 Open Access Same-Time Information System (OASIS): The information

system and standards of conduct contained in Part 37 of the

Commission's regulations and all additional requirements implemented by

subsequent Commission orders dealing with OASIS.

1.29 Part I: Tariff Definitions and Common Service Provisions

contained in Sections 2 through 12.

1.30 Part II: Tariff Sections 13 through 27 pertaining to Point-To-

Point Transmission Service in conjunction with the applicable Common

Service Provisions of Part I and appropriate Schedules and Attachments.

1.31 Part III: Tariff Sections 28 through 35 pertaining to Network

Integration Transmission Service in conjunction with the applicable

Common Service Provisions of Part I and appropriate Schedules and

Attachments.

1.32 Parties: The Transmission Provider and the Transmission Customer

receiving service under the Tariff.

1.33 Point(s) of Delivery: Point(s) on the Transmission Provider's

Transmission System where capacity and energy transmitted by the

Transmission Provider will be made available to the Receiving Party

under Part II of the Tariff. The Point(s) of Delivery shall be

specified in the Service Agreement for Long-Term Firm Point-to-Point

Transmission Service.

1.34 Point(s) of Receipt: Point(s) of interconnection on the

Transmission Provider's Transmission System where capacity and energy

will be made available to the Transmission Provider by the Delivering

Party under Part II of the Tariff. The Point(s) of Receipt shall be

specified in the Service Agreement for Long-Term Firm Point-to-Point

Transmission Service.

1.35 Point-To-Point Transmission Service: The reservation and

transmission of capacity and energy on either a firm or non-firm basis

from the Point(s) of Receipt to the Point(s) of Delivery under Part II

of the Tariff.

1.36 Power Purchaser: The entity that is purchasing the capacity and

energy to be transmitted under the Tariff.

1.37 Receiving Party: The entity receiving the capacity and energy

transmitted by the Transmission Provider to Point(s) of Delivery.

[[Page 50580]]

1.38 Regional Transmission Group (RTG): A voluntary organization of

transmission owners, transmission users and other entities approved by

the Commission to efficiently coordinate transmission planning (and

expansion), operation and use on a regional (and interregional) basis.

1.39 Reserved Capacity: The maximum amount of capacity and energy that

the Transmission Provider agrees to transmit for the Transmission

Customer over the Transmission Provider's Transmission System between

the Point(s) of Receipt and the Point(s) of Delivery under Part II of

the Tariff. Reserved Capacity shall be expressed in terms of whole

megawatts on a sixty (60) minute interval (commencing on the clock

hour) basis.

1.40 Service Agreement: The initial agreement and any amendments or

supplements thereto entered into by the Transmission Customer and the

Transmission Provider for service under the Tariff.

1.41 Service Commencement Date: The date the Transmission Provider

begins to provide service pursuant to the terms of an executed Service

Agreement, or the date the Transmission Provider begins to provide

service in accordance with Section 15.3 or Section 29.1 under the

Tariff.

1.42 Short-Term Firm Point-To-Point Transmission Service: Firm Point-

To-Point Transmission Service under Part II of the Tariff with a term

of less than one year.

1.43 System Impact Study: An assessment by the Transmission Provider

of (i) the adequacy of the Transmission System to accommodate a request

for either Firm Point-To-Point Transmission Service or Network

Integration Transmission Service and (ii) whether any additional costs

may be incurred in order to provide transmission service.

1.44 Third-Party Sale: Any sale for resale in interstate commerce to a

Power Purchaser that is not designated as part of Network Load under

the Network Integration Transmission Service.

1.45 Transmission Customer: Any Eligible Customer (or its Designated

Agent) that (i) executes a Service Agreement, or (ii) requests in

writing that the Transmission Provider provide transmission service

without a Service Agreement, pursuant to section 15.3 of the Tariff.

This term is used in the Part I Common Service Provisions to include

customers receiving transmission service under Part II and Part III of

this Tariff.

1.46 Transmission Provider: The Regional Office of the Western Area

Power Administration (Western) which owns, controls, or operates the

facilities used for the transmission of electric energy in interstate

commerce and provides transmission service under the Tariff with which

the Transmission Customer has contracted to provide Transmission

Service (See Attachment K).

1.47 Transmission Provider's Monthly Transmission System Peak: The

maximum firm usage of the Transmission Provider's Transmission System

in a calendar month.

1.48 Transmission Service: Point-To-Point Transmission Service

provided under Part II of the Tariff on a firm and non-firm basis.

1.49 Transmission System: The facilities owned, controlled or operated

by the Transmission Provider that are used to provide transmission

service under Part II and Part III of the Tariff and are defined in

Attachment K to the Tariff.

2 Initial Allocation and Renewal Procedures

2.1 Initial Allocation of Available Transmission Capability: For

purposes of determining whether existing capability on the Transmission

Provider's Transmission System is adequate to accommodate a request for

firm service under this Tariff, all Completed Applications for new firm

transmission service received during the initial sixty (60) day period

commencing with the effective date of the Tariff will be deemed to have

been filed simultaneously. A lottery system conducted by an independent

party shall be used to assign priorities for Completed Applications

filed simultaneously. All Completed Applications for firm transmission

service received after the initial sixty (60) day period shall be

assigned a priority pursuant to Section 13.2.

2.2 Reservation Priority For Existing Firm Service Customers: Existing

firm service customers (wholesale requirements and transmission-only,

with a contract term of one-year or more), have the right to continue

to take transmission service from the Transmission Provider when the

contract expires, rolls over or is renewed. This transmission

reservation priority is independent of whether the existing customer

continues to purchase capacity and energy from the Transmission

Provider or elects to purchase capacity and energy from another

supplier. If at the end of the contract term, the Transmission

Provider's Transmission System cannot accommodate all of the requests

for transmission service, the existing firm service customer must agree

to accept a contract term at least equal to a competing request by any

new Eligible Customer and to pay the current rate for such service.

This transmission reservation priority for existing firm service

customers is an ongoing right that may be exercised at the end of all

firm contract terms of one-year or longer.

3 Ancillary Services

Ancillary Services are needed with transmission service to maintain

reliability within and among the Control Areas affected by the

transmission service. The Transmission Provider is required to provide

(or offer to arrange with the local Control Area operator as discussed

below), and the Transmission Customer is required to purchase, the

following Ancillary Services (i) Scheduling, System Control and

Dispatch, and (ii) Reactive Supply and Voltage Control from Generation

Sources.

The Transmission Provider is required, to the extent possible, to

offer to provide (or offer to arrange with the local Control Area

operator as discussed below) the following Ancillary Services only to

the Transmission Customer serving load within the Transmission

Provider's Control Area (i) Regulation and Frequency Response, (ii)

Energy Imbalance, (iii) Operating Reserve--Spinning, and (iv) Operating

Reserve--Supplemental. The Transmission Customer serving load within

the Transmission Provider's Control Area, is required to acquire these

Ancillary Services, whether from the Transmission Provider, from a

third party, or by self-supply. The Transmission Customer may not

decline the Transmission Provider's offer of Ancillary Services unless

it demonstrates that it has acquired the Ancillary Services from

another source. The Transmission Provider will offer to provide the

Transmission Customer Ancillary Services only to the extent surplus

Federal generation is available for such services. However, the

Transmission Provider may purchase Ancillary Services from others on

behalf of the Transmission Customer under the terms of an agreement

separate from the Service Agreement. The costs of such purchases on

behalf of a Transmission Customer will be passed directly through to

that Transmission Customer. The Transmission Customer must list in its

Application which Ancillary

[[Page 50581]]

Services it will purchase from the Transmission Provider.

If the Transmission Provider is a utility providing transmission

service, but is not a Control Area operator, it may be unable to

provide some or all of the Ancillary Services. In this case, the

Transmission Provider can fulfill its obligation to provide Ancillary

Services by acting as the Transmission Customer's agent to secure these

Ancillary Services from the Control Area operator. The Transmission

Customer may elect to (i) have the Transmission Provider act as its

agent, (ii) secure the Ancillary Services directly from the Control

Area operator, or (iii) secure the Ancillary Services (discussed in

Schedules 3, 4, 5, and 6) from a third party or by self-supply when

technically feasible.

The Transmission Provider shall specify the rate treatment and all

related terms and conditions in the event of an unauthorized use of

Ancillary Services by the Transmission Customer.

The specific Ancillary Services, prices and/or compensation methods

for each are described on the Schedules that are attached to and made a

part of the Tariff. Three principal requirements apply to discounts for

Ancillary Services provided by the Transmission Provider in conjunction

with its provision of transmission service as follows: (1) Any offer of

a discount made by the Transmission Provider must be announced to all

Eligible Customers solely by posting on the OASIS, (2) any customer-

initiated requests for discounts (including requests for use by one's

wholesale merchant or an affiliate's use) must occur solely by posting

on the OASIS, and (3) once a discount is negotiated, details must be

immediately posted on the OASIS. A discount agreed upon for an

Ancillary Service must be offered for the same period to all Eligible

Customers on the Transmission Provider's system. Sections 3.1 through

3.6 below list the six Ancillary Services.

3.1 Scheduling, System Control and Dispatch Service: The rates and/or

methodology are described in Schedule 1.

3.2 Reactive Supply and Voltage Control from Generation Sources

Service: The rates and/or methodology are described in Schedule 2.

3.3 Regulation and Frequency Response Service: Where applicable the

rates and/or methodology are described in Schedule 3.

3.4 Energy Imbalance Service: Where applicable the rates and/or

methodology are described in Schedule 4.

3.5 Operating Reserve--Spinning Reserve Service: Where applicable the

rates and/or methodology are described in Schedule 5.

3.6 Operating Reserve--Supplemental Reserve Service: Where applicable

the rates and/or methodology are described in Schedule 6.

4 Open Access Same-Time Information System (OASIS)

Terms and conditions regarding Open Access Same-Time Information

System and standards of conduct are set forth in 18 CFR 37 of the

Commission's regulations (Open Access Same-Time Information System and

Standards of Conduct for Public Utilities). In the event available

transmission capability as posted on the OASIS is insufficient to

accommodate a request for firm transmission service, additional studies

may be required as provided by this Tariff pursuant to Sections 19 and

32.

5 Local Furnishing Bonds

5.1 Transmission Providers That Own Facilities Financed by Local

Furnishing Bonds: This provision is applicable only to Transmission

Providers that have financed facilities for the local furnishing of

electric energy with tax-exempt bonds, as described in Section 142(f)

of the Internal Revenue Code (``local furnishing bonds'').

Notwithstanding any other provision of this Tariff, the Transmission

Provider shall not be required to provide transmission service to any

Eligible Customer pursuant to this Tariff if the provision of such

transmission service would jeopardize the tax-exempt status of any

local furnishing bond(s) used to finance the Transmission Provider's

facilities that would be used in providing such transmission service.

5.2 Alternative Procedures for Requesting Transmission Service:

(i) If the Transmission Provider determines that the provision of

transmission service requested by an Eligible Customer would jeopardize

the tax-exempt status of any local furnishing bond(s) used to finance

its facilities that would be used in providing such transmission

service, it shall advise the Eligible Customer within thirty (30) days

of receipt of the Completed Application.

(ii) If the Eligible Customer thereafter renews its request for the

same transmission service referred to in (i) by tendering an

application under Section 211 of the Federal Power Act, the

Transmission Provider, within ten (10) days of receiving a copy of the

Section 211 application, will waive its rights to a request for service

under Section 213(a) of the Federal Power Act and to the issuance of a

proposed order under Section 212(c) of the Federal Power Act. The

Commission, upon receipt of the Transmission Provider's waiver of its

rights to a request for service under Section 213(a) of the Federal

Power Act and to the issuance of a proposed order under Section 212(c)

of the Federal Power Act, shall issue an order under Section 211 of the

Federal Power Act. Upon issuance of the order under Section 211 of the

Federal Power Act, the Transmission Provider shall be required to

provide the requested transmission service in accordance with the terms

and conditions of this Tariff.

6 Reciprocity

A Transmission Customer receiving transmission service under this

Tariff agrees to provide comparable transmission service that it is

capable of providing to the Transmission Provider on similar terms and

conditions over facilities used for the transmission of electric energy

owned, controlled or operated by the Transmission Customer and over

facilities used for the transmission of electric energy owned,

controlled or operated by the Transmission Customer's corporate

affiliates. A Transmission Customer that is a member of a power pool or

Regional Transmission Group also agrees to provide comparable

transmission service to the members of such power pool and Regional

Transmission Group on similar terms and conditions over facilities used

for the transmission of electric energy owned, controlled or operated

by the Transmission Customer and over facilities used for the

transmission of electric energy owned, controlled or operated by the

Transmission Customer's corporate affiliates.

This reciprocity requirement applies not only to the Transmission

Customer that obtains transmission service under the Tariff, but also

to all parties to a transaction that involves the use of transmission

service under the Tariff, including the power seller, buyer and any

intermediary, such as a power marketer. This reciprocity requirement

also applies to any Eligible Customer that owns, controls or operates

transmission facilities that uses an intermediary, such as a power

marketer, to request transmission service under the Tariff. If the

Transmission Customer does not own, control or operate transmission

facilities, it must include

[[Page 50582]]

in its Application a sworn statement of one of its duly authorized

officers or other representatives that the purpose of its Application

is not to assist an Eligible Customer to avoid the requirements of this

provision.

7 Billing and Payment

7.1 Billing Procedures: Within a reasonable time after the first day

of each month, the Transmission Provider shall submit an invoice to the

Transmission Customer for the charges for all services furnished under

the Tariff during the preceding month. The invoice shall be paid by the

Transmission Customer within twenty (20) days of receipt. All payments

shall be made in immediately available funds payable to the

Transmission Provider, or by wire transfer to a bank named by the

Transmission Provider.

7.2 Interest on Unpaid Balances: Interest on any unpaid amounts

(including amounts placed in escrow) shall be calculated in accordance

with the methodology specified for interest on refunds in the

Commission's regulations at 18 CFR 35.19a(a)(2)(iii). Interest on

delinquent amounts shall be calculated from the due date of the bill to

the date of payment. When payments are made by mail, bills shall be

considered as having been paid on the date of receipt by the

Transmission Provider.

7.3 Customer Default: In the event the Transmission Customer fails,

for any reason other than a billing dispute as described below, to make

payment to the Transmission Provider on or before the due date as

described above, and such failure of payment is not corrected within

thirty (30) calendar days after the Transmission Provider notifies the

Transmission Customer to cure such failure, a default by the

Transmission Customer shall be deemed to exist. Within the same 30

calendar days after notice of failure to make payment, the Transmission

Customer shall have the right of appeal to the Administrator of

Western. The Transmission Provider shall submit its recommendation to

the Administrator for review and approval, but shall not terminate

service until the Administrator makes a determination on the

Transmission Customer's appeal. In the event of a billing dispute

between the Transmission Provider and the Transmission Customer, the

Transmission Provider will continue to provide service under the

Service Agreement as long as the Transmission Customer (i) continues to

make all payments not in dispute, and (ii) pays into an independent

escrow account the portion of the invoice in dispute, pending

resolution of such dispute. If the Transmission Customer fails to meet

these two requirements for continuation of service, then the

Transmission Provider may provide notice to the Transmission Customer

of its intention to suspend service in sixty (60) days, in accordance

with Commission policy.

8 Accounting for the Transmission Provider's Use of the Tariff

The Transmission Provider shall record the following amounts, as

outlined below.

8.1 Transmission Revenues: Include in a separate operating revenue

account or subaccount the revenues it receives from Transmission

Service when making Third-Party Sales under Part II of the Tariff.

8.2 Study Costs and Revenues: Include in a separate transmission

operating expense account or subaccount, costs properly chargeable to

expense that are incurred to perform any System Impact Studies or

Facilities Studies which the Transmission Provider conducts to

determine if it must construct new transmission facilities or upgrades

necessary for its own uses, including making Third-Party Sales under

the Tariff; and include in a separate operating revenue account or

subaccount the revenues received for System Impact Studies or

Facilities Studies performed when such amounts are separately stated

and identified in the Transmission Customer's billing under the Tariff.

9 Regulatory Filings

Nothing contained in the Tariff or any Service Agreement shall be

construed as affecting in any way the ability of any Party receiving

service under the Tariff to exercise its rights under the Federal Power

Act and pursuant to the Commission's rules and regulations promulgated

thereunder.

10 Force Majeure and Indemnification

10.1 Force Majeure: An event of Force Majeure means any act of God,

labor disturbance, act of the public enemy, war, insurrection, riot,

fire, storm or flood, explosion, breakage or accident to machinery or

equipment, any Curtailment, order, regulation or restriction imposed by

governmental military or lawfully established civilian authorities, or

any other cause beyond a Party's control. A Force Majeure event does

not include an act of negligence or intentional wrongdoing. Neither the

Transmission Provider nor the Transmission Customer will be considered

in default as to any obligation under this Tariff if prevented from

fulfilling the obligation due to an event of Force Majeure. However, a

Party whose performance under this Tariff is hindered by an event of

Force Majeure shall make all reasonable efforts to perform its

obligations under this Tariff. Either Party rendered unable to fulfill

any of its obligations under the Service Agreement by reason of an

uncontrollable force shall give prompt written notice of such fact to

the other Party and shall exercise due diligence to remove such

inability with all reasonable dispatch.

10.2 Indemnification: The Transmission Customer shall at all times

indemnify, defend, and save the Transmission Provider harmless from,

any and all damages, losses, claims, including claims and actions

relating to injury to or death of any person or damage to property,

demands, suits, recoveries, costs and expenses, court costs, attorney

fees, and all other obligations by or to third parties, arising out of

or resulting from the Transmission Provider's performance of its

obligations under this Tariff on behalf of the Transmission Customer,

except in cases of negligence or intentional wrongdoing by the

Transmission Provider. The liability of the Transmission Provider shall

be determined in accordance with the provisions of the Federal Tort

Claims Act, as amended.

11 Creditworthiness

For the purpose of determining the ability of the Transmission

Customer to meet its obligations related to service hereunder, the

Transmission Provider may require reasonable credit review procedures.

This review shall be made in accordance with standard commercial

practices.

In addition, the Transmission Provider may require the Transmission

Customer to provide and maintain in effect during the term of the

Service Agreement, an unconditional and irrevocable letter of credit as

security to meet its responsibilities and obligations under the Tariff,

or an alternative form of security proposed by the Transmission

Customer and acceptable to the Transmission Provider and consistent

with commercial practices established by the Uniform Commercial Code

that protects the Transmission Provider against the risk of non-

payment.

[[Page 50583]]

12 Dispute Resolution Procedures

12.1 Internal Dispute Resolution Procedures: Any dispute between a

Transmission Customer and the Transmission Provider involving

transmission service under the Tariff shall be referred to a designated

senior representative of the Transmission Provider and a senior

representative of the Transmission Customer for resolution on an

informal basis as promptly as practicable.

12.2 Disputes: Any dispute regarding service provided under the

Service Agreement will be resolved in a manner consistent with the

Administrative Dispute Resolution Act, as amended, subject to statutory

and regulatory limits on Western's authority to submit disputes to

arbitration.

12.3 Rights Under The Federal Power Act: Nothing in this section shall

restrict the rights of any party to file a Complaint with the

Commission under relevant provisions of the Federal Power Act.

Part II. Point-To-Point Transmission Service

Preamble

The Transmission Provider will provide Firm and Non-Firm Point-To-

Point Transmission Service pursuant to the applicable terms and

conditions of this Tariff. Point-To-Point Transmission Service is for

the receipt of capacity and energy at designated Point(s) of Receipt

and the transmission of such capacity and energy to designated Point(s)

of Delivery.

13 Nature of Firm Point-To-Point Transmission Service

13.1 Term: The minimum term of Firm Point-To-Point Transmission

Service shall be one day and the maximum term shall be specified in the

Service Agreement.

13.2 Reservation Priority: Long-Term Firm Point-To-Point Transmission

Service shall be available on a first-come, first-served basis i.e., in

the chronological sequence in which each Transmission Customer reserved

service. Reservations for Short-Term Firm Point-To-Point Transmission

Service will be conditional based upon the length of the requested

transaction. If the Transmission System becomes oversubscribed,

requests for longer term service may preempt requests for shorter term

service up to the following deadlines; one day before the commencement

of daily service, one week before the commencement of weekly service,

and one month before the commencement of monthly service. Before the

conditional reservation deadline, if available transmission capability

is insufficient to satisfy all Applications, an Eligible Customer with

a reservation for shorter term service has the right of first refusal

to match any longer term reservation before losing its reservation

priority. A longer term competing request for Short-Term Firm Point-To-

Point Transmission Service will be granted if the Eligible Customer

with the right of first refusal does not agree to match the competing

request within 24 hours (or earlier if necessary to comply with the

scheduling deadlines provided in Section 13.8) from being notified by

the Transmission Provider of a longer-term competing request for Short-

Term Firm Point-To-Point Transmission Service. After the conditional

reservation deadline, service will commence pursuant to the terms of

Part II of the Tariff. Firm Point-To-Point Transmission Service will

always have a reservation priority over Non-Firm Point-To-Point

Transmission Service under the Tariff. All Long-Term Firm Point-To-

Point Transmission Service will have equal reservation priority with

Native Load Customers and Network Customers. Reservation priorities for

existing firm service customers are provided in Section 2.2.

13.3 Use of Firm Transmission Service by the Transmission Provider:

The Transmission Provider will be subject to the rates, terms and

conditions of Part II of the Tariff when making Third-Party Sales under

agreements executed on or after November 25, 1997. The Transmission

Provider will maintain separate accounting, pursuant to Section 8, for

any use of the Point-To-Point Transmission Service to make Third-Party

Sales.

13.4 Service Agreements: The Transmission Provider shall offer a

standard form Firm Point-To-Point Transmission Service Agreement

(Attachment A) to an Eligible Customer when it submits a Completed

Application for Long-Term Firm Point-To-Point Transmission Service. The

Transmission Provider shall offer a standard form Firm Point-to-Point

Transmission Service Agreement (Attachment A) to an Eligible Customer

when it first submits a Completed Application for Short-Term Firm

Point-to-Point Transmission Service pursuant to the Tariff.

13.5 Transmission Customer Obligations for Facility Additions or

Redispatch Costs: In cases where the Transmission Provider determines

that the Transmission System is not capable of providing Firm Point-To-

Point Transmission Service without (1) degrading or impairing the

reliability of service to Native Load Customers, Network Customers and

other Transmission Customers taking Firm Point-To-Point Transmission

Service, or (2) interfering with the Transmission Provider's ability to

meet prior firm contractual commitments to others, the Transmission

Provider will be obligated to expand or upgrade its Transmission System

pursuant to the terms of Section 15.4. The Transmission Customer must

agree to compensate the Transmission Provider in advance for any

necessary transmission facility additions pursuant to the terms of

Section 27. To the extent the Transmission Provider can relieve any

system constraint more economically by redispatching the Transmission

Provider's resources than through constructing Network Upgrades, it

shall do so, provided that the Eligible Customer agrees to compensate

the Transmission Provider pursuant to the terms of Section 27. Any

redispatch, Network Upgrade or Direct Assignment Facilities costs to be

charged to the Transmission Customer on an incremental basis under the

Tariff will be specified in the Service Agreement or a separate

agreement, as appropriate, prior to initiating service.

13.6 Curtailment of Firm Transmission Service: In the event that a

Curtailment on the Transmission Provider's Transmission System, or a

portion thereof, is required to maintain reliable operation of such

system, Curtailments will be made on a non-discriminatory basis to the

transaction(s) that effectively relieve the constraint. If multiple

transactions require Curtailment, to the extent practicable and

consistent with Good Utility Practice, the Transmission Provider will

curtail service to Network Customers and Transmission Customers taking

Firm Point-To-Point Transmission Service on a basis comparable to the

curtailment of service to the Transmission Provider's Native Load

Customers. All Curtailments will be made on a non-discriminatory basis,

however, Non-Firm Point-To-Point Transmission Service shall be

subordinate to Firm Transmission Service. When the Transmission

Provider determines that an electrical emergency exists on its

Transmission System and

[[Page 50584]]

implements emergency procedures to Curtail Firm Transmission Service,

the Transmission Customer shall make the required reductions upon

request of the Transmission Provider. However, the Transmission

Provider reserves the right to Curtail, in whole or in part, any Firm

Transmission Service provided under the Tariff when, in the

Transmission Provider's sole discretion, an emergency or other

unforeseen condition impairs or degrades the reliability of its

Transmission System. The Transmission Provider will notify all affected

Transmission Customers in a timely manner of any scheduled

Curtailments.

13.7 Classification of Firm Transmission Service:

(a) The Transmission Customer taking Firm Point-To-Point

Transmission Service may (1) change its Receipt and Delivery Points to

obtain service on a non-firm basis consistent with the terms of Section

22.1 or (2) request a modification of the Points of Receipt or Delivery

on a firm basis pursuant to the terms of Section 22.2.

(b) The Transmission Customer may purchase transmission service to

make sales of capacity and energy from multiple generating units that

are on the Transmission Provider's Transmission System. For such a

purchase of transmission service, the resources will be designated as

multiple Points of Receipt, unless the multiple generating units are at

the same generating plant in which case the units would be treated as a

single Point of Receipt.

(c) The Transmission Provider shall provide firm deliveries of

capacity and energy from the Point(s) of Receipt to the Point(s) of

Delivery. Each Point of Receipt at which firm transmission capacity is

reserved by the Transmission Customer shall be set forth in the Firm

Point-To-Point Service Agreement for Long-Term Firm Transmission

Service along with a corresponding capacity reservation associated with

each Point of Receipt. Points of Receipt and corresponding capacity

reservations shall be as mutually agreed upon by the Parties for Short-

Term Firm Transmission. Each Point of Delivery at which firm

transmission capacity is reserved by the Transmission Customer shall be

set forth in the Firm Point-To-Point Service Agreement for Long-Term

Firm Transmission Service along with a corresponding capacity

reservation associated with each Point of Delivery. Points of Delivery

and corresponding capacity reservations shall be as mutually agreed

upon by the Parties for Short-Term Firm Transmission. The greater of

either (1) the sum of the capacity reservations at the Point(s) of

Receipt, or (2) the sum of the capacity reservations at the Point(s) of

Delivery shall be the Transmission Customer's Reserved Capacity. The

Transmission Customer will be billed for its Reserved Capacity under

the terms of Schedule 7. The Transmission Customer may not exceed its

firm capacity reserved at each Point of Receipt and each Point of

Delivery except as otherwise specified in Section 22. The Transmission

Provider shall specify the rate treatment and all related terms and

conditions applicable in the event that a Transmission Customer,

(including Third-Party Sales by the Transmission Provider) exceeds its

firm reserved capacity at any Point of Receipt or Point of Delivery.

13.8 Scheduling of Firm Point-To-Point Transmission Service: Schedules

for the Transmission Customer's Firm Point-To-Point Transmission

Service must be submitted to the Transmission Provider no later than

10:00 a.m. [or a reasonable time that is generally accepted in the

region and is consistently adhered to by the Transmission Provider] of

the day prior to commencement of such service. Schedules submitted

after 10:00 a.m. will be accommodated, if practicable. Hour-to-hour

schedules of any capacity and energy that is to be delivered must be

stated in increments of 1,000 kW per hour [or a reasonable increment

that is generally accepted in the region and is consistently adhered to

by the Transmission Provider]. Transmission Customers within the

Transmission Provider's service area with multiple requests for

Transmission Service at a Point of Receipt, each of which is under

1,000 kW per hour, may consolidate their service requests at a common

point of receipt into units of 1,000 kW per hour for scheduling and

billing purposes. Scheduling changes will be permitted up to twenty

(20) minutes [or a reasonable time that is generally accepted in the

region and is consistently adhered to by the Transmission Provider]

before the start of the next clock hour provided that the Delivering

Party and Receiving Party also agree to the schedule modification. The

Transmission Provider will furnish to the Delivering Party's system

operator, hour-to-hour schedules equal to those furnished by the

Receiving Party (unless reduced for losses) and shall deliver the

capacity and energy provided by such schedules. Should the Transmission

Customer, Delivering Party or Receiving Party revise or terminate any

schedule, such party shall immediately notify the Transmission

Provider, and the Transmission Provider shall have the right to adjust

accordingly the schedule for capacity and energy to be received and to

be delivered.

14 Nature of Non-Firm Point-To-Point Transmission Service

14.1 Term: Non-Firm Point-To-Point Transmission Service will be

available for periods ranging from one (1) hour to one (1) month.

However, a Purchaser of Non-Firm Point-To-Point Transmission Service

will be entitled to reserve a sequential term of service (such as a

sequential monthly term without having to wait for the initial term to

expire before requesting another monthly term) so that the total time

period for which the reservation applies is greater than one month,

subject to the requirements of Section 18.3.

14.2 Reservation Priority: Non-Firm Point-To-Point Transmission

Service shall be available from transmission capability in excess of

that needed for reliable service to Native Load Customers, Network

Customers and other Transmission Customers taking Long-Term and Short-

Term Firm Point-To-Point Transmission Service. A higher priority will

be assigned to reservations with a longer duration of service. In the

event the Transmission System is constrained, competing requests of

equal duration will be prioritized based on the highest price offered

by the Eligible Customer for the Transmission Service. Eligible

Customers that have already reserved shorter term service have the

right of first refusal to match any longer term reservation before

being preempted. A longer term competing request for Non-Firm Point-To-

Point Transmission Service will be granted if the Eligible Customer

with the right of first refusal does not agree to match the competing

request: (a) Immediately for hourly Non-Firm Point-To-Point

Transmission Service after notification by the Transmission Provider;

and, (b) within 24 hours (or earlier if necessary to comply with the

scheduling deadlines provided in Section 14.6) for Non-Firm Point-To-

[[Page 50585]]

Point Transmission Service other than hourly transactions after

notification by the Transmission Provider. Transmission service for

Network Customers from resources other than designated Network

Resources will have a higher priority than any Non-Firm Point-To-Point

Transmission Service. Non-Firm Point-To-Point Transmission Service over

secondary Point(s) of Receipt and Point(s) of Delivery will have the

lowest reservation priority under the Tariff.

14.3 Use of Non-Firm Point-To-Point Transmission Service by the

Transmission Provider: The Transmission Provider will be subject to the

rates, terms and conditions of Part II of the Tariff when making Third-

Party Sales under agreements executed on or after November 25, 1997.

The Transmission Provider will maintain separate accounting, pursuant

to Section 8, for any use of Non-Firm Point-To-Point Transmission

Service to make Third-Party Sales.

14.4 Service Agreements: The Transmission Provider shall offer a

standard form Non-Firm Point-To-Point Transmission Service Agreement

(Attachment D) to an Eligible Customer when it first submits a

Completed Application for Non-Firm Point-To-Point Transmission Service

pursuant to the Tariff.

14.5 Classification of Non-Firm Point-To-Point Transmission Service:

Non-Firm Point-To-Point Transmission Service shall be offered under

terms and conditions contained in Part II of the Tariff. The

Transmission Provider undertakes no obligation under the Tariff to plan

its Transmission System in order to have sufficient capacity for Non-

Firm Point-To-Point Transmission Service. Parties requesting Non-Firm

Point-To-Point Transmission Service for the transmission of firm power

do so with the full realization that such service is subject to

availability and to Curtailment or Interruption under the terms of the

Tariff. The Transmission Provider shall specify the rate treatment and

all related terms and conditions applicable in the event that a

Transmission Customer (including Third-Party Sales by the Transmission

Provider) exceeds its non-firm capacity reservation. Non-Firm Point-To-

Point Transmission Service shall include transmission of energy on an

hourly basis and transmission of scheduled short-term capacity and

energy on a daily, weekly or monthly basis, but not to exceed one

month's reservation for any one Application under Schedule 8.

14.6 Scheduling of Non-Firm Point-To-Point Transmission Service:

Schedules for Non-Firm Point-To-Point Transmission Service must be

submitted to the Transmission Provider no later than 2:00 p.m. [or a

reasonable time that is generally accepted in the region and is

consistently adhered to by the Transmission Provider] of the day prior

to commencement of such service. Schedules submitted after 2:00 p.m.

will be accommodated, if practicable. Hour-to-hour schedules of energy

that are to be delivered must be stated in increments of 1,000 kW per

hour [or a reasonable increment that is generally accepted in the

region and is consistently adhered to by the Transmission Provider].

Transmission Customers within the Transmission Provider's service area

with multiple requests for Transmission Service at a Point of Receipt,

each of which is under 1,000 kW per hour, may consolidate their

schedules at a common Point of Receipt into units of 1,000 kW per hour.

Scheduling changes will be permitted up to twenty (20) minutes [or a

reasonable time that is generally accepted in the region and is

consistently adhered to by the Transmission Provider] before the start

of the next clock hour provided that the Delivering Party and Receiving

Party also agree to the schedule modification. The Transmission

Provider will furnish to the Delivering Party's system operator, hour-

to-hour schedules equal to those furnished by the Receiving Party

(unless reduced for losses) and shall deliver the capacity and energy

provided by such schedules. Should the Transmission Customer,

Delivering Party or Receiving Party revise or terminate any schedule,

such party shall immediately notify the Transmission Provider, and the

Transmission Provider shall have the right to adjust accordingly the

schedule for capacity and energy to be received and to be delivered.

14.7 Curtailment or Interruption of Service: The Transmission Provider

reserves the right to Curtail, in whole or in part, Non-Firm Point-To-

Point Transmission Service provided under the Tariff for reliability

reasons when, an emergency or other unforeseen condition threatens to

impair or degrade the reliability of its Transmission System. The

Transmission Provider reserves the right to Interrupt, in whole or in

part, Non-Firm Point-To-Point Transmission Service provided under the

Tariff for economic reasons in order to accommodate (1) a request for

Firm Transmission Service, (2) a request for Non-Firm Point-To-Point

Transmission Service of greater duration, (3) a request for Non-Firm

Point-To-Point Transmission Service of equal duration with a higher

price, or (4) transmission service for Network Customers from non-

designated resources. The Transmission Provider also will discontinue

or reduce service to the Transmission Customer to the extent that

deliveries for transmission are discontinued or reduced at the Point(s)

of Receipt. Where required, Curtailments or Interruptions will be made

on a non-discriminatory basis to the transaction(s) that effectively

relieve the constraint, however, Non-Firm Point-To-Point Transmission

Service shall be subordinate to Firm Transmission Service. If multiple

transactions require Curtailment or Interruption, to the extent

practicable and consistent with Good Utility Practice, Curtailments or

Interruptions will be made to transactions of the shortest term (e.g.,

hourly non-firm transactions will be Curtailed or Interrupted before

daily non-firm transactions and daily non-firm transactions will be

Curtailed or Interrupted before weekly non-firm transactions).

Transmission service for Network Customers from resources other than

designated Network Resources will have a higher priority than any Non-

Firm Point-To-Point Transmission Service under the Tariff. Non-Firm

Point-To-Point Transmission Service over secondary Point(s) of Receipt

and Point(s) of Delivery will have a lower priority than any Non-Firm

Point-To-Point Transmission Service under the Tariff. The Transmission

Provider will provide advance notice of Curtailment or Interruption

where such notice can be provided consistent with Good Utility

Practice.

15 Service Availability

15.1 General Conditions: The Transmission Provider will provide Firm

and Non-Firm Point-To-Point Transmission Service over, on or across its

Transmission System to any Transmission Customer that has met the

requirements of Section 16.

15.2 Determination of Available Transmission Capability: A description

of the Transmission Provider's specific methodology for assessing

available transmission capability posted on the Transmission

[[Page 50586]]

Provider's OASIS (Section 4) is contained in Attachment C of the

Tariff. In the event sufficient transmission capability may not exist

to accommodate a service request, the Transmission Provider will

respond by performing a System Impact Study.

15.3 Initiating Service in the Absence of an Executed Service

Agreement: If the Transmission Provider and the Transmission Customer

requesting Firm or Non-Firm Point-To-Point Transmission Service cannot

agree on all the terms and conditions of the Point-To-Point Service

Agreement, the Transmission Provider shall commence providing

Transmission Service subject to the Transmission Customer agreeing to

(i) compensate the Transmission Provider at the existing rate placed in

effect pursuant to applicable Federal law and regulations , and (ii)

comply with the terms and conditions of the Tariff including paying the

appropriate processing fees in accordance with the terms of Section

17.3. If the Transmission Customer cannot accept all of the terms and

conditions of the offered Service Agreement, the Transmission Customer

may request resolution of the unacceptable terms and conditions under

Section 12, Dispute Resolution Procedures, of the Tariff. Any changes

resulting from the Dispute Resolution Procedures will be effective upon

the date of initial service.

15.4 Obligation to Provide Transmission Service that Requires

Expansion or Modification of the Transmission System: If the

Transmission Provider determines that it cannot accommodate a Completed

Application for Firm Point-To-Point Transmission Service because of

insufficient capability on its Transmission System, the Transmission

Provider will use due diligence to expand or modify its Transmission

System to provide the requested Firm Transmission Service, provided the

Transmission Customer agrees to compensate the Transmission Provider in

advance for such costs pursuant to the terms of Section 27. The

Transmission Provider will conform to Good Utility Practice in

determining the need for new facilities and in the design and

construction of such facilities. The obligation applies only to those

facilities that the Transmission Provider has the right to expand or

modify.

15.5 Deferral of Service: The Transmission Provider may defer

providing service until it completes construction of new transmission

facilities or upgrades needed to provide Firm Point-To-Point

Transmission Service whenever the Transmission Provider determines that

providing the requested service would, without such new facilities or

upgrades, impair or degrade reliability to any existing firm services.

15.6 Other Transmission Service Schedules: Eligible Customers

receiving transmission service under other agreements on file with the

Commission may continue to receive transmission service under those

agreements until such time as those agreements may be modified by the

Commission.

15.7 Real Power Losses: Real Power Losses are associated with all

transmission service. The Transmission Provider is not obligated to

provide Real Power Losses. The Transmission Customer is responsible for

replacing losses associated with all transmission service as calculated

by the Transmission Provider. The applicable Real Power Loss factors

are specified in the Service Agreements.

16 Transmission Customer Responsibilities

16.1 Conditions Required of Transmission Customers: Point-To-Point

Transmission Service shall be provided by the Transmission Provider

only if the following conditions are satisfied by the Transmission

Customer:

a. The Transmission Customer has pending a Completed Application

for service;

b. The Transmission Customer meets the creditworthiness criteria

set forth in Section 11;

c. The Transmission Customer will have arrangements in place for

any other transmission service necessary to effect the delivery from

the generating source to the Transmission Provider prior to the time

service under Part II of the Tariff commences;

d. The Transmission Customer agrees to pay for any facilities

constructed and chargeable to such Transmission Customer under Part II

of the Tariff, whether or not the Transmission Customer takes service

for the full term of its reservation; and

e. The Transmission Customer has executed a Point-To-Point Service

Agreement or has agreed to receive service pursuant to Section 15.3.

16.2 Transmission Customer Responsibility for Third-Party

Arrangements: Any scheduling arrangements that may be required by other

electric systems shall be the responsibility of the Transmission

Customer requesting service. The Transmission Customer shall provide,

unless waived by the Transmission Provider, notification to the

Transmission Provider identifying such systems and authorizing them to

schedule the capacity and energy to be transmitted by the Transmission

Provider pursuant to Part II of the Tariff on behalf of the Receiving

Party at the Point of Delivery or the Delivering Party at the Point of

Receipt. However, the Transmission Provider will undertake reasonable

efforts to assist the Transmission Customer in making such

arrangements, including without limitation, providing any information

or data required by such other electric system pursuant to Good Utility

Practice.

17 Procedures for Arranging Firm Point-To-Point Transmission Service

17.1 Application: A request for Firm Point-To-Point Transmission

Service for periods of one year or longer must contain a written

Application to appropriate Regional Office, as identified in Attachment

K to the Tariff, at least sixty (60) days in advance of the calendar

month in which service is to commence. The Transmission Provider will

consider requests for such firm service on shorter notice when

feasible. Requests for firm service for periods of less than one year

shall be subject to expedited procedures that shall be negotiated

between the Parties within the time constraints provided in Section

17.5. All Firm Point-To-Point Transmission Service requests should be

submitted by entering the information listed below on the Transmission

Provider's OASIS. Prior to implementation of the Transmission

Provider's OASIS, a Completed Application may be submitted by (i)

transmitting the required information to the Transmission Provider by

telefax, or (ii) providing the information by telephone over the

Transmission Provider's time recorded telephone line. Each of these

methods will provide a time-stamped record for establishing the

priority of the Application.

17.2 Completed Application: A Completed Application shall provide all

of the information included in 18 CFR 2.20 including but not limited to

the following:

(i) The identity, address, telephone number and facsimile number of

the entity requesting service;

[[Page 50587]]

(ii) A statement that the entity requesting service is, or will be

upon commencement of service, an Eligible Customer under the Tariff;

(iii) The location of the Point(s) of Receipt and Point(s) of

Delivery and the identities of the Delivering Parties and the Receiving

Parties;

(iv) The location of the generating facility(ies) supplying the

capacity and energy and the location of the load ultimately served by

the capacity and energy transmitted. The Transmission Provider will

treat this information as confidential except to the extent that

disclosure of this information is required by the Tariff, by regulatory

or judicial order, for reliability purposes pursuant to Good Utility

Practice or pursuant to RTG transmission information sharing

agreements. The Transmission Provider shall treat this information

consistent with the standards of conduct contained in Part 37 of the

Commission's regulations;

(v) A description of the supply characteristics of the capacity and

energy to be delivered;

(vi) An estimate of the capacity and energy expected to be

delivered to the Receiving Party;

(vii) The Service Commencement Date and the term of the requested

Transmission Service;

(viii) The transmission capacity requested for each Point of

Receipt and each Point of Delivery on the Transmission Provider's

Transmission System; customers may combine their requests for service

in order to satisfy the minimum transmission capacity requirement;

The Transmission Provider shall treat this information consistent

with the standards of conduct contained in Part 37 of the Commission's

regulations.

17.3 Processing Fee: A Completed Application for Firm Point-To-Point

Transmission Service also shall include a non-refundable processing

fee. Such fee shall be applicable to all Transmission Customers for

firm Transmission Service requests of one year or longer. Individual

Transmission Provider processing fees will be calculated using the

number of estimated hours it will take to process an application and

will be set forth in Attachment K. This fee does not apply to costs to

complete System Impact Studies or Facility Studies or to add new

facilities.

17.4 Notice of Deficient Application: If an Application fails to meet

the requirements of the Tariff, the Transmission Provider shall notify

the entity requesting service within fifteen (15) days of receipt of

the reasons for such failure. The Transmission Provider will attempt to

remedy minor deficiencies in the Application through informal

communications with the Eligible Customer. If such efforts are

unsuccessful, the Transmission Provider shall return the Application.

Upon receipt of a new or revised Application that fully complies with

the requirements of Part II of the Tariff, the Eligible Customer shall

be assigned a new priority consistent with the date of the new or

revised Application.

17.5 Response to a Completed Application: Following receipt of a

Completed Application for Firm Point-To-Point Transmission Service, the

Transmission Provider shall make a determination of available

transmission capability as required in Section 15.2. The Transmission

Provider shall notify the Eligible Customer as soon as practicable, but

not later than thirty (30) days after the date of receipt of a

Completed Application either (i) if it will be able to provide service

without performing a System Impact Study or (ii) if such a study is

needed to evaluate the impact of the Application pursuant to Section

19.1. Responses by the Transmission Provider must be made as soon as

practicable to all completed applications (including applications by

its own merchant function) and the timing of such responses must be

made on a non-discriminatory basis.

17.6 Execution of a Service Agreement: Whenever the Transmission

Provider determines that a System Impact Study is not required and that

the service can be provided, it shall notify the Eligible Customer as

soon as practicable but no later than thirty (30) days after receipt of

the Completed Application. Where a System Impact Study is required, the

provisions of Section 19 will govern the execution of a Service

Agreement. Failure of an Eligible Customer to execute and return the

Service Agreement or request service without an executed Service

Agreement pursuant to Section 15.3, within fifteen (15) days after it

is tendered by the Transmission Provider will be deemed a withdrawal

and termination of the Application. Nothing herein limits the right of

an Eligible Customer to file another Application after such withdrawal

and termination.

17.7 Extensions for Commencement of Service: The Transmission Customer

can obtain up to five (5) one-year extensions for the commencement of

service. The Transmission Customer may postpone service by paying a

non-refundable annual reservation fee equal to one-month's charge for

Firm Transmission Service for each year or fraction thereof. If during

any extension for the commencement of service an Eligible Customer

submits a Completed Application for Firm Transmission Service, and such

request can be satisfied only by releasing all or part of the

Transmission Customer's Reserved Capacity, the original Reserved

Capacity will be released unless the following condition is satisfied.

Within thirty (30) days, the original Transmission Customer agrees to

pay the Firm Point-To-Point transmission rate for its Reserved Capacity

concurrent with the new Service Commencement Date. In the event the

Transmission Customer elects to release the Reserved Capacity, the

reservation fees or portions thereof previously paid will be forfeited.

18 Procedures for Arranging Non-Firm Point-To-Point Transmission

Service

18.1 Application: Eligible Customers seeking Non-Firm Point-To-Point

Transmission Service must submit a Completed Application to the

Transmission Provider. Applications should be submitted by entering the

information listed below on the Transmission Provider's OASIS. Prior to

implementation of the Transmission Provider's OASIS, a Completed

Application may be submitted by (i) transmitting the required

information to the Transmission Provider by telefax, or (ii) providing

the information by telephone over the Transmission Provider's time

recorded telephone line. Each of these methods will provide a time-

stamped record for establishing the service priority of the

Application.

18.2 Completed Application: A Completed Application shall provide all

of the information included in 18 CFR 2.20 including but not limited to

the following:

(i) The identity, address, telephone number and facsimile number of

the entity requesting service;

(ii) A statement that the entity requesting service is, or will be

upon commencement of service, an Eligible Customer under the Tariff;

(iii) The Point(s) of Receipt and the Point(s) of Delivery;

(iv) The maximum amount of capacity

[[Page 50588]]

requested at each Point of Receipt and Point of Delivery; and

(v) The proposed dates and hours for initiating and terminating

transmission service hereunder.

In addition to the information specified above, when required to

properly evaluate system conditions, the Transmission Provider also may

ask the Transmission Customer to provide the following:

(vi) The electrical location of the initial source of the power to

be transmitted pursuant to the Transmission Customer's request for

service;

(vii) The electrical location of the ultimate load

The Transmission Provider will treat this information in (vi) and

(vii) as confidential at the request of the Transmission Customer

except to the extent that disclosure of this information is required by

this Tariff, by Federal Law or regulatory or judicial order, for

reliability purposes pursuant to Good Utility Practice, or pursuant to

RTG transmission information sharing agreements. The Transmission

Provider shall treat this information consistent with the standards of

conduct contained in Part 37 of the Commission's regulations.

18.3 Reservation of Non-Firm Point-To-Point Transmission Service:

Requests for monthly service shall be submitted no earlier than sixty

(60) days before service is to commence; requests for weekly service

shall be submitted no earlier than fourteen (14) days before service is

to commence, requests for daily service shall be submitted no earlier

than two (2) days before service is to commence, and requests for

hourly service shall be submitted no earlier than noon the day before

service is to commence. Requests for service received later than 2:00

p.m. prior to the day service is scheduled to commence will be

accommodated if practicable [or such reasonable times that are

generally accepted in the region and are consistently adhered to by the

Transmission Provider].

18.4 Determination of Available Transmission Capability: Following

receipt of a tendered schedule the Transmission Provider will make a

determination on a non-discriminatory basis of available transmission

capability pursuant to Section 15.2. Such determination shall be made

as soon as reasonably practicable after receipt, but not later than the

following time periods for the following terms of service (i) thirty

(30) minutes for hourly service, (ii) thirty (30) minutes for daily

service, (iii) four (4) hours for weekly service, and (iv) two (2) days

for monthly service. [Or such reasonable times that are generally

accepted in the region and are consistently adhered to by the

Transmission Provider].

19 Additional Study Procedures for Firm Point-To-Point Transmission

Service Requests

19.1 Notice of Need for System Impact Study: After receiving a request

for service, the Transmission Provider shall determine on a non-

discriminatory basis whether a System Impact Study is needed. A

description of the Transmission Provider's methodology for completing a

System Impact Study is provided in Attachment D. If the Transmission

Provider determines that a System Impact Study is necessary to

accommodate the requested service, it shall so inform the Eligible

Customer, as soon as practicable. In such cases, the Transmission

Provider shall within thirty (30) days of receipt of a Completed

Application, tender a System Impact Study Agreement pursuant to which

the Eligible Customer shall agree to advance funds to the Transmission

Provider for performing the required System Impact Study. For a service

request to remain a Completed Application, the Eligible Customer shall

execute the System Impact Study Agreement and return it to the

Transmission Provider within fifteen (15) days. If the Eligible

Customer elects not to execute the System Impact Study Agreement, its

application shall be deemed withdrawn.

19.2 System Impact Study Agreement and Compensation:

(i) The System Impact Study Agreement will clearly specify the

Transmission Provider's estimate of the actual cost, and time for

completion of the System Impact Study. The charge will not exceed the

actual cost of the study. In performing the System Impact Study, the

Transmission Provider shall rely, to the extent reasonably practicable,

on existing transmission planning studies. The Eligible Customer will

not be assessed a charge for such existing studies; however, the

Eligible Customer will be responsible for charges associated with any

modifications to existing planning studies that are reasonably

necessary to evaluate the impact of the Eligible Customer's request for

service on the Transmission System.

(ii) If in response to multiple Eligible Customers requesting

service in relation to the same competitive solicitation, a single

System Impact Study is sufficient for the Transmission Provider to

accommodate the requests for service, the costs of that study shall be

pro-rated among the Eligible Customers.

(iii) For System Impact Studies that the Transmission Provider

conducts on its own behalf, the Transmission Provider shall record the

cost of the System Impact Studies pursuant to Section 8.

19.3 System Impact Study Procedures: Upon receipt of an executed

System Impact Study Agreement, the Transmission Provider will use due

diligence to complete the required System Impact Study within a sixty

(60) day period. The System Impact Study shall identify any system

constraints and redispatch options, additional Direct Assignment

Facilities or Network Upgrades required to provide the requested

service. In the event that the Transmission Provider is unable to

complete the required System Impact Study within such time period, it

shall so notify the Eligible Customer and provide an estimated

completion date along with an explanation of the reasons why additional

time is required to complete the required studies. A copy of the

completed System Impact Study and related work papers shall be made

available to the Eligible Customer. The Transmission Provider will use

the same due diligence in completing the System Impact Study for an

Eligible Customer as it uses when completing studies for itself. The

Transmission Provider shall notify the Eligible Customer immediately

upon completion of the System Impact Study if the Transmission System

will be adequate to accommodate all or part of a request for service or

that no costs are likely to be incurred for new transmission facilities

or upgrades. In order for a request to remain a Completed Application,

within fifteen (15) days of completion of the System Impact Study the

Eligible Customer must execute a Service Agreement or request service

without an executed Service Agreement pursuant to Section 15.3, or the

Application shall be deemed terminated and withdrawn.

19.4 Facilities Study Procedures: If a System Impact Study indicates

that

[[Page 50589]]

additions or upgrades to the Transmission System are needed to supply

the Eligible Customer's service request, the Transmission Provider,

within thirty (30) days of the completion of the System Impact Study,

shall tender to the Eligible Customer a Facilities Study Agreement

pursuant to which the Eligible Customer shall agree to advance funds to

the Transmission Provider for performing the required Facilities Study.

For a service request to remain a Completed Application, the Eligible

Customer shall execute the Facilities Study Agreement and return it to

the Transmission Provider within fifteen (15) days. If the Eligible

Customer elects not to execute the Facilities Study Agreement, its

application shall be deemed withdrawn. Upon receipt of an executed

Facilities Study Agreement, the Transmission Provider will use due

diligence to complete the required Facilities Study within a sixty (60)

day period. If the Transmission Provider is unable to complete the

Facilities Study in the allotted time period, the Transmission Provider

shall notify the Transmission Customer and provide an estimate of the

time needed to reach a final determination along with an explanation of

the reasons that additional time is required to complete the study.

When completed, the Facilities Study will include a good faith estimate

of (i) the cost of Direct Assignment Facilities to be charged to the

Transmission Customer, (ii) the Transmission Customer's appropriate

share of the cost of any required Network Upgrades as determined

pursuant to the provisions of Part II of the Tariff, and (iii) the time

required to complete such construction and initiate the requested

service. The Transmission Customer shall pay the Transmission Provider

in advance the Transmission Customer's share of the costs of new

facilities or upgrades. The Transmission Customer shall have thirty

(30) days to execute a construction agreement and a Service Agreement

and provide the advance payment or request service without an executed

Service Agreement pursuant to Section 15.3 and provide the required

letter of credit or other form of security or the request will no

longer be a Completed Application and shall be deemed terminated and

withdrawn.

19.5 Facilities Study Modifications: Any change in design arising from

inability to site or construct facilities as proposed will require

development of a revised good faith estimate. New good faith estimates

also will be required in the event of new statutory or regulatory

requirements that are effective before the completion of construction

or other circumstances beyond the control of the Transmission Provider

that significantly affect the final cost of new facilities or upgrades

to be charged to the Transmission Customer pursuant to the provisions

of Part II of the Tariff.

19.6 Due Diligence in Completing New Facilities: The Transmission

Provider shall use due diligence to add necessary facilities or upgrade

its Transmission System within a reasonable time. The Transmission

Provider will not upgrade its existing or planned Transmission System

in order to provide the requested Firm Point-To-Point Transmission

Service if doing so would impair system reliability or otherwise impair

or degrade existing firm service.

19.7 Partial Interim Service: If the Transmission Provider determines

that it will not have adequate transmission capability to satisfy the

full amount of a Completed Application for Firm Point-To-Point

Transmission Service, the Transmission Provider nonetheless shall be

obligated to offer and provide the portion of the requested Firm Point-

To-Point Transmission Service that can be accommodated without addition

of any facilities and through redispatch. However, the Transmission

Provider shall not be obligated to provide the incremental amount of

requested Firm Point-To-Point Transmission Service that requires the

addition of facilities or upgrades to the Transmission System until

such facilities or upgrades have been placed in service.

19.8 Expedited Procedures for New Facilities: In lieu of the

procedures set forth above, the Eligible Customer shall have the option

to expedite the process by requesting the Transmission Provider to

tender at one time, together with the results of required studies, an

``Expedited Service Agreement'' pursuant to which the Eligible Customer

would agree to compensate the Transmission Provider in advance for all

costs incurred pursuant to the terms of the Tariff. In order to

exercise this option, the Eligible Customer shall request in writing an

expedited Service Agreement covering all of the above-specified items

within thirty (30) days of receiving the results of the System Impact

Study identifying needed facility additions or upgrades or costs

incurred in providing the requested service. While the Transmission

Provider agrees to provide the Eligible Customer with its best estimate

of the new facility costs and other charges that may be incurred, such

estimate shall not be binding and the Eligible Customer must agree in

writing to compensate the Transmission Provider in advance for all

costs incurred pursuant to the provisions of the Tariff. The Eligible

Customer shall execute and return such an Expedited Service Agreement

within fifteen (15) days of its receipt or the Eligible Customer's

request for service will cease to be a Completed Application and will

be deemed terminated and withdrawn.

20 Procedures if the Transmission Provider Is Unable To Complete New

Transmission Facilities for Firm Point-To-Point Transmission Service

20.1 Delays in Construction of New Facilities: If any event occurs

that will materially affect the time for completion of new facilities,

or the ability to complete them, the Transmission Provider shall

promptly notify the Transmission Customer. In such circumstances, the

Transmission Provider shall within thirty (30) days of notifying the

Transmission Customer of such delays, convene a technical meeting with

the Transmission Customer to evaluate the alternatives available to the

Transmission Customer. The Transmission Provider also shall make

available to the Transmission Customer studies and work papers related

to the delay, including all information that is in the possession of

the Transmission Provider that is reasonably needed by the Transmission

Customer to evaluate any alternatives.

20.2 Alternatives to the Original Facility Additions: When the review

process of Section 20.1 determines that one or more alternatives exist

to the originally planned construction project, the Transmission

Provider shall present such alternatives for consideration by the

Transmission Customer. If, upon review of any alternatives, the

Transmission Customer desires to maintain its Completed Application

subject to construction of the alternative facilities, it may request

the Transmission Provider to submit a revised Service Agreement for

Firm Point-To-Point Transmission Service. If the alternative approach

solely involves Non-Firm Point-To-Point Transmission Service, the

[[Page 50590]]

Transmission Provider shall promptly tender a Service Agreement for

Non-Firm Point-To-Point Transmission Service providing for the service.

In the event the Transmission Provider concludes that no reasonable

alternative exists and the Transmission Customer disagrees, the

Transmission Customer may seek relief under the dispute resolution

procedures pursuant to Section 12 or it may refer the dispute to the

Commission for resolution.

20.3 Refund Obligation for Unfinished Facility Additions: If the

Transmission Provider and the Transmission Customer mutually agree that

no other reasonable alternatives exist and the requested service cannot

be provided out of existing capability under the conditions of Part II

of the Tariff, the obligation to provide the requested Firm Point-To-

Point Transmission Service shall terminate and any advance payment made

by the Transmission Customer that is in excess of the costs incurred by

the Transmission Provider through the time construction was suspended

shall be returned. However, the Transmission Customer shall be

responsible for all prudently incurred costs by the Transmission

Provider through the time construction was suspended.

21 Provisions Relating to Transmission Construction and Services on

the Systems of Other Utilities

21.1 Responsibility for Third-Party System Additions: The Transmission

Provider shall not be responsible for making arrangements for any

necessary engineering, permitting, and construction of transmission or

distribution facilities on the system(s) of any other entity or for

obtaining any regulatory approval for such facilities. The Transmission

Provider will undertake reasonable efforts to assist the Transmission

Customer in obtaining such arrangements, including without limitation,

providing any information or data required by such other electric

system pursuant to Good Utility Practice.

21.2 Coordination of Third-Party System Additions: In circumstances

where the need for transmission facilities or upgrades is identified

pursuant to the provisions of Part II of the Tariff, and if such

upgrades further require the addition of transmission facilities on

other systems, the Transmission Provider shall have the right to

coordinate construction on its own system with the construction

required by others. The Transmission Provider, after consultation with

the Transmission Customer and representatives of such other systems,

may defer construction of its new transmission facilities, if the new

transmission facilities on another system cannot be completed in a

timely manner. The Transmission Provider shall notify the Transmission

Customer in writing of the basis for any decision to defer construction

and the specific problems which must be resolved before it will

initiate or resume construction of new facilities. Within sixty (60)

days of receiving written notification by the Transmission Provider of

its intent to defer construction pursuant to this section, the

Transmission Customer may challenge the decision in accordance with the

dispute resolution procedures pursuant to Section 12 or it may refer

the dispute to the Commission for resolution.

22 Changes in Service Specifications

22.1 Modifications On a Non-Firm Basis: The Transmission Customer

taking Firm Point-To-Point Transmission Service may request the

Transmission Provider to provide transmission service on a non-firm

basis over Receipt and Delivery Points other than those specified in

the Service Agreement (``Secondary Receipt and Delivery Points''), in

amounts not to exceed its firm capacity reservation, without incurring

an additional Non-Firm Point-To-Point Transmission Service charge or

executing a new Service Agreement, subject to the following conditions.

(a) Service provided over Secondary Receipt and Delivery Points

will be non-firm only, on an as-available basis and will not displace

any firm or non-firm service reserved or scheduled by third-parties

under the Tariff or by the Transmission Provider on behalf of its

Native Load Customers.

(b) The sum of all Firm and non-firm Point-To-Point Transmission

Service provided to the Transmission Customer at any time pursuant to

this section shall not exceed the Reserved Capacity in the relevant

Service Agreement under which such services are provided.

(c) The Transmission Customer shall retain its right to schedule

Firm Point-To-Point Transmission Service at the Receipt and Delivery

Points specified in the relevant Service Agreement in the amount of its

original capacity reservation.

(d) Service over Secondary Receipt and Delivery Points on a non-

firm basis shall not require the filing of an Application for Non-Firm

Point-To-Point Transmission Service under the Tariff. However, all

other requirements of Part II of the Tariff (except as to transmission

rates) shall apply to transmission service on a non-firm basis over

Secondary Receipt and Delivery Points.

22.2 Modifications On a Firm Basis: Any request by a Transmission

Customer to modify Receipt and Delivery Points on a firm basis shall be

treated as a new request for service in accordance with Section 17

hereof except that such Transmission Customer shall not be obligated to

pay any additional application processing fee if the capacity

reservation does not exceed the amount reserved in the existing Service

Agreement. While such new request is pending, the Transmission Customer

shall retain its priority for service at the existing firm Receipt and

Delivery Points specified in its Service Agreement.

23 Sale or Assignment of Transmission Service

23.1 Procedures for Assignment or Transfer of Service: Subject to

Commission approval of any necessary filings, a Transmission Customer

may sell, assign, or transfer all or a portion of its rights under its

Service Agreement, but only to another Eligible Customer (the

Assignee). The Transmission Customer that sells, assigns or transfers

its rights under its Service Agreement is hereafter referred to as the

Reseller. Compensation to the Reseller shall not exceed the higher of

(i) the original rate paid by the Reseller, (ii) the Transmission

Provider's maximum rate on file at the time of the assignment, or (iii)

the Reseller's opportunity cost capped at the Transmission Provider's

cost of expansion. If the Assignee does not request any change in the

Point(s) of Receipt or the Point(s) of Delivery, or a change in any

other term or condition set forth in the original Service Agreement,

the Assignee will receive the same services as did the Reseller and the

priority of service for the Assignee will be the same as that of the

Reseller. A Reseller should notify the Transmission Provider as soon as

possible after any assignment or transfer of service occurs but in any

event, notification must be provided prior to any provision of service

to the Assignee. The Assignee will be subject to all terms and

conditions of the Tariff. If the Assignee requests a change in service,

the reservation priority of service will be determined

[[Page 50591]]

by the Transmission Provider pursuant to Section 13.2.

23.2 Limitations on Assignment or Transfer of Service: If the Assignee

requests a change in the Point(s) of Receipt or Point(s) of Delivery,

or a change in any other specifications set forth in the original

Service Agreement, the Transmission Provider will consent to such

change subject to the provisions of the Tariff, provided that the

change will not impair the operation and reliability of the

Transmission Provider's generation, transmission, or distribution

systems. The Assignee shall compensate the Transmission Provider in

advance for performing any System Impact Study needed to evaluate the

capability of the Transmission System to accommodate the proposed

change and any additional costs resulting from such change. The

Reseller shall remain liable for the performance of all obligations

under the Service Agreement, except as specifically agreed to by the

Parties through an amendment to the Service Agreement.

23.3 Information on Assignment or Transfer of Service: In accordance

with Section 4, Resellers may use the Transmission Provider's OASIS to

post transmission capacity available for resale.

24 Metering and Power Factor Correction at Receipt and Delivery

Point(s)

24.1 Transmission Customer Obligations: Unless otherwise agreed, the

Transmission Customer shall be responsible for installing and

maintaining compatible metering and communications equipment to

accurately account for the capacity and energy being transmitted under

Part II of the Tariff and to communicate the information to the

Transmission Provider. Such equipment shall remain the property of the

Transmission Customer.

24.2 Transmission Provider Access to Metering Data: The Transmission

Provider shall have access to metering data, which may reasonably be

required to facilitate measurements and billing under the Service

Agreement.

24.3 Power Factor: Unless otherwise agreed, the Transmission Customer

is required to maintain a power factor within the same range as the

Transmission Provider pursuant to Good Utility Practices. The power

factor requirements are specified in the Service Agreement where

applicable.

25 Compensation for Transmission Service

Rates for Firm and Non-Firm Point-To-Point Transmission Service are

provided in the Schedules appended to the Tariff: Firm Point-To-Point

Transmission Service (Schedule 7); and Non-Firm Point-To-Point

Transmission Service (Schedule 8). The Transmission Provider shall use

Part II of the Tariff to make its Third-Party Sales. The Transmission

Provider shall account for such use at the applicable Tariff rates,

pursuant to Section 8.

26 Stranded Cost Recovery

The Transmission Provider may seek to recover stranded costs from

the Transmission Customer in a manner consistent with applicable

Federal law and regulations.

27 Compensation for New Facilities and Redispatch Costs

Whenever a System Impact Study performed by the Transmission

Provider in connection with the provision of Firm Point-To-Point

Transmission Service identifies the need for new facilities, the

Transmission Customer shall be responsible for such costs to the extent

consistent with Commission policy. Whenever a System Impact Study

performed by the Transmission Provider identifies capacity constraints

that may be relieved more economically by redispatching the

Transmission Provider's resources than by building new facilities or

upgrading existing facilities to eliminate such constraints, the

Transmission Customer shall be responsible for the redispatch costs to

the extent consistent with Commission policy.

Part III. Network Integration Transmission Service

Preamble

The Transmission Provider will provide Network Integration

Transmission Service pursuant to the applicable terms and conditions

contained in the Tariff and Service Agreement. Network Integration

Transmission Service allows the Network Customer to integrate,

economically dispatch and regulate its current and planned Network

Resources to serve its Network Load in a manner comparable to that in

which the Transmission Provider utilizes its Transmission System to

serve its Native Load Customers. Network Integration Transmission

Service also may be used by the Network Customer to deliver economy

energy purchases to its Network Load from non-designated resources on

an as-available basis without additional charge. Transmission service

for sales to non-designated loads will be provided pursuant to the

applicable terms and conditions of Part II of the Tariff.

28 Nature of Network Integration Transmission Service

28.1 Scope of Service: Network Integration Transmission Service is a

transmission service that allows Network Customers to efficiently and

economically utilize their Network Resources (as well as other non-

designated generation resources) to serve their Network Load located in

the Transmission Provider's Control Area and any additional load that

may be designated pursuant to Section 31.3 of the Tariff. The Network

Customer taking Network Integration Transmission Service must obtain or

provide Ancillary Services pursuant to Section 3.

28.2 Transmission Provider Responsibilities: The Transmission Provider

will plan, construct, operate and maintain its Transmission System in

accordance with Good Utility Practice in order to provide the Network

Customer with Network Integration Transmission Service over the

Transmission Provider's Transmission System. The Transmission Provider,

on behalf of its Native Load Customers, shall be required to designate

resources and loads in the same manner as any Network Customer under

Part III of the Tariff. This information must be consistent with the

information used by the Transmission Provider to calculate available

transmission capability. The Transmission Provider shall include the

Network Customer's Network Load in its Transmission System planning and

shall, consistent with Good Utility Practice, endeavor to construct and

place into service sufficient transmission capacity to deliver the

Network Customer's Network Resources to serve its Network Load on a

basis comparable to the Transmission Provider's delivery of its own

generating and purchased resources to its Native Load Customers. This

obligation to construct and place into service sufficient capacity to

deliver the Network Customer's Network Resources to serve its Network

Load is contingent upon the availability to Western of sufficient

appropriations, when needed, and the Transmission Customer's advanced

funds.

28.3 Network Integration Transmission Service: The Transmission

Provider will provide firm transmission service over its Transmission

System to the

[[Page 50592]]

Network Customer for the delivery of capacity and energy from its

designated Network Resources to service its Network Loads on a basis

that is comparable to the Transmission Provider's use of the

Transmission System to reliably serve its Native Load Customers.

28.4 Secondary Service: The Network Customer may use the Transmission

Provider's Transmission System to deliver energy to its Network Loads

from resources that have not been designated as Network Resources. Such

energy shall be transmitted, on an as-available basis, at no additional

charge. Deliveries from resources other than Network Resources will

have a higher priority than any Non-Firm Point-To-Point Transmission

Service under Part II of the Tariff.

28.5 Real Power Losses: Real Power Losses are associated with all

transmission service. The Transmission Provider is not obligated to

provide Real Power Losses. The Network Customer is responsible for

replacing losses associated with all transmission service as calculated

by the Transmission Provider. The applicable Real Power Loss factors

are specified in the Service Agreements.

28.6 Restrictions on Use of Service: The Network Customer shall not

use Network Integration Transmission Service for (i) sales of capacity

and energy to non-designated loads, or (ii) direct or indirect

provision of transmission service by the Network Customer to third

parties. All Network Customers taking Network Integration Transmission

Service shall use Point-To-Point Transmission Service under Part II of

the Tariff for any Third-Party Sale which requires use of the

Transmission Provider's Transmission System.

29 Initiating Service

29.1 Condition Precedent for Receiving Service: Subject to the terms

and conditions of Part III of the Tariff, the Transmission Provider

will provide Network Integration Transmission Service to any Eligible

Customer provided that (i) the Eligible Customer completes an

Application for service as provided under Part III of the Tariff, (ii)

the Eligible Customer and the Transmission Provider complete the

technical arrangements set forth in Sections 29.3 and 29.4, (iii) the

Eligible Customer executes a Service Agreement pursuant to Attachment F

for service under Part III of the Tariff or requests in writing that

the Transmission Provider provide service without an executed Service

Agreement, and (iv) the Eligible Customer executes a Network Operating

Agreement with the Transmission Provider pursuant to Attachment G. If

the Transmission Provider and the Network Customer cannot agree on all

the terms and conditions of the Network Service Agreement, the

Transmission Provider shall commence providing Network Integration

Transmission Service subject to the Network Customer agreeing to (i)

compensate the Transmission Provider at the existing rate placed in

effect pursuant to applicable Federal law and regulations, and (ii)

comply with the terms and conditions of the Tariff including paying the

appropriate processing fees in accordance with the terms of Section

29.2. If the Network Customer cannot accept all of the terms and

conditions of the offered Service Agreement, the Network Customer may

request resolution of the unacceptable terms and conditions under

Section 12, Dispute Resolution Procedures, of the Tariff. Any changes

resulting from the Dispute Resolution Procedures will be effective upon

the date of initial service.

29.2 Application Procedures: An Eligible Customer requesting service

under Part III of the Tariff must submit an Application to the

Transmission Provider as far as possible in advance of the month in

which service is to commence. Unless subject to the procedures in

Section 2, Completed Applications for Network Integration Transmission

Service will be assigned a priority according to the date and time the

Application is received, with the earliest Application receiving the

highest priority. Applications should be submitted by entering the

information listed below on the Transmission Provider's OASIS. Prior to

implementation of the Transmission Provider's OASIS, a Completed

Application may be submitted by (i) transmitting the required

information to the Transmission Provider by telefax, or (ii) providing

the information by telephone over the Transmission Provider's time

recorded telephone line. Each of these methods will provide a time-

stamped record for establishing the service priority of the

Application. A Completed Application for Network Integration

Transmission Service also shall include a non-refundable processing

fee. Such fee shall be applicable to all Transmission Customers for

firm Transmission Service requests of one year or longer. Individual

Transmission Provider processing fees will be calculated using the

number of estimated hours it will take to process an application and

will be set forth in Attachment K. This fee does not apply to costs to

complete System Impact Studies or Facility Studies or to add new

facilities. A Completed Application shall provide all of the

information included in 18 CFR 2.20 including but not limited to the

following:

(i) The identity, address, telephone number and facsimile number

of the party requesting service;

(ii) A statement that the party requesting service is, or will be

upon commencement of service, an Eligible Customer under the Tariff;

(iii) A description of the Network Load at each delivery point.

This description should separately identify and provide the Eligible

Customer's best estimate of the total loads to be served at each

transmission voltage level, and the loads to be served from each

Transmission Provider substation at the same transmission voltage

level. The description should include a ten (10) year forecast of

summer and winter load and resource requirements beginning with the

first year after the service is scheduled to commence;

(iv) The amount and location of any interruptible loads included

in the Network Load. This shall include the summer and winter capacity

requirements for each interruptible load (had such load not been

interruptible), that portion of the load subject to interruption, the

conditions under which an interruption can be implemented and any

limitations on the amount and frequency of interruptions. An Eligible

Customer should identify the amount of interruptible customer load (if

any), included in the 10 year load forecast provided in response to

(iii) above;

(v) A description of Network Resources (current and 10-year

projection), which shall include, for each Network Resource:

--Unit size and amount of capacity from that unit to be designated as

Network Resource

--VAR capability (both leading and lagging), of all generators

--Operating restrictions

--Any periods of restricted operations throughout the year

--Maintenance schedules

--Minimum loading level of unit

--Normal operating level of unit

[[Page 50593]]

--Any must-run unit designations required for system reliability or

contract reasons

--Approximate variable generating cost ($/MWH) for redispatch

computations

--Arrangements governing sale and delivery of power to third parties

from generating facilities located in the Transmission Provider Control

Area, where only a portion of unit output is designated as a Network

Resource

--Description of purchased power designated as a Network Resource

including source of supply, Control Area location, transmission

arrangements and delivery point(s) to the Transmission Provider's

Transmission System;

(vi) Description of Eligible Customer's transmission system:

--Load flow and stability data, such as real and reactive parts of the

load, lines, transformers, reactive devices and load type, including

normal and emergency ratings of all transmission equipment in a load

flow format compatible with that used by the Transmission Provider

--Operating restrictions needed for reliability

--Operating guides employed by system operators

--Contractual restrictions or committed uses of the Eligible Customer's

transmission system, other than the Eligible Customer's Network Loads

and Resources

--Location of Network Resources described in subsection (v) above

--10 year projection of system expansions or upgrades

--Transmission System maps that include any proposed expansions or

upgrades

--Thermal ratings of Eligible Customer's Control Area ties with other

Control Areas;

(vii) Service Commencement Date and the term of the requested

Network Integration Transmission Service. The minimum term for Network

Integration Transmission Service is one year;

Unless the Parties agree to a different time frame, the

Transmission Provider must acknowledge the request within ten (10) days

of receipt. The acknowledgment must include a date by which a response,

including a Service Agreement, will be sent to the Eligible Customer.

If an Application fails to meet the requirements of this section, the

Transmission Provider shall notify the Eligible Customer requesting

service within fifteen (15) days of receipt and specify the reasons for

such failure. Wherever possible, the Transmission Provider will attempt

to remedy deficiencies in the Application through informal

communications with the Eligible Customer. If such efforts are

unsuccessful, the Transmission Provider shall return the Application

without prejudice to the Eligible Customer filing a new or revised

Application that fully complies with the requirements of this section.

The Eligible Customer will be assigned a new priority consistent with

the date of the new or revised Application. The Transmission Provider

shall treat this information consistent with the standards of conduct

contained in Part 37 of the Commission's regulations.

29.3 Technical Arrangements to be Completed Prior to Commencement of

Service: Network Integration Transmission Service shall not commence

until the Transmission Provider and the Network Customer or a third

party, have completed installation of all equipment specified under the

Network Operating Agreement consistent with Good Utility Practice and

any additional requirements reasonably and consistently imposed to

ensure the reliable operation of the Transmission System. The

Transmission Provider shall exercise reasonable efforts, in

coordination with the Network Customer to complete such arrangements as

soon as practicable taking into consideration the Service Commencement

Date.

29.4 Network Customer Facilities: The provision of Network Integration

Transmission Service shall be conditioned upon the Network Customer

constructing, maintaining and operating the facilities on its side of

each delivery point or interconnection necessary to reliably deliver

capacity and energy from the Transmission Provider's Transmission

System to the Network Customer. The Network Customer shall be solely

responsible for constructing or installing all facilities on the

Network Customer's side of each such delivery point or interconnection.

29.5 This section is intentionally left blank.

30 Network Resources

30.1 Designation of Network Resources: Network Resources shall include

all generation owned, purchased, or leased by the Network Customer

designated to serve Network Load under the Tariff. Network Resources

may not include resources, or any portion thereof, that are committed

for sale to non-designated third party load or otherwise cannot be

called upon to meet the Network Customer's Network Load on a non-

interruptible basis. Any owned or purchased resources that were serving

the Network Customer's loads under firm agreements entered into on or

before the Service Commencement Date shall initially be designated as

Network Resources until the Network Customer terminates the designation

of such resources.

30.2 Designation of New Network Resources: The Network Customer may

designate a new Network Resource by providing the Transmission Provider

with as much advance notice as practicable. A designation of a new

Network Resource must be made by a request for modification of service

pursuant to an Application under Section 29.

30.3 Termination of Network Resources: The Network Customer may

terminate the designation of all or part of a generating resource as a

Network Resource at any time but should provide notification to the

Transmission Provider as soon as reasonably practicable.

30.4 Operation of Network Resources: The Network Customer shall not

operate its designated Network Resources located in the Network

Customer's or Transmission Provider's Control Area such that the output

of those facilities exceeds its designated Network Load, plus non-firm

sales delivered pursuant to Part II of the Tariff, plus losses. This

limitation shall not apply to changes in the operation of a

Transmission Customer's Network Resources at the request of the

Transmission Provider to respond to an emergency or other unforeseen

condition which may impair or degrade the reliability of the

Transmission System.

30.5 Network Customer Redispatch Obligation: As a condition to

receiving Network Integration Transmission Service, the Network

Customer agrees to redispatch its Network Resources as requested by the

Transmission Provider pursuant to Section 33.2. To the extent

practical, the redispatch of resources pursuant to this section shall

be on a least cost, non-discriminatory basis between all Network

Customers, and the Transmission Provider.

30.6 Transmission Arrangements for Network Resources Not Physically

Interconnected With The Transmission Provider: The Network Customer

shall be responsible for any arrangements necessary to deliver capacity

and energy from a Network Resource not physically interconnected with

the Transmission Provider's Transmission System. The Transmission

Provider will undertake

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reasonable efforts to assist the Network Customer in obtaining such

arrangements, including without limitation, providing any information

or data required by such other entity pursuant to Good Utility

Practice.

30.7 Limitation on Designation of Network Resources: The Network

Customer must demonstrate that it owns or has committed to purchase

generation pursuant to an executed contract in order to designate a

generating resource as a Network Resource. Alternatively, the Network

Customer may establish that execution of a contract is contingent upon

the availability of transmission service under Part III of the Tariff.

30.8 Use of Interface Capacity by the Network Customer: There is no

limitation upon a Network Customer's use of the Transmission Provider's

Transmission System at any particular interface to integrate the

Network Customer's Network Resources (or substitute economy purchases)

with its Network Loads. However, a Network Customer's use of the

Transmission Provider's total interface capacity with other

transmission systems may not exceed the Network Customer's Load.

30.9 Network Customer Owned Transmission Facilities: The Network

Customer that owns existing transmission facilities that are integrated

with the Transmission Provider's Transmission System may be eligible to

receive consideration either through a billing credit or some other

mechanism. In order to receive such consideration the Network Customer

must demonstrate that its transmission facilities are integrated into

the plans or operations of the Transmission Provider to serve its power

and transmission customers. For facilities constructed by the Network

Customer subsequent to the Service Commencement Date under Part III of

the Tariff, the Network Customer shall receive credit where such

facilities are jointly planned and installed in coordination with the

Transmission Provider. Calculation of the credit shall be addressed in

either the Network Customer's Service Agreement or any other agreement

between the Parties.

31 Designation of Network Load

31.1 Network Load: The Network Customer must designate the individual

Network Loads on whose behalf the Transmission Provider will provide

Network Integration Transmission Service. The Network Loads shall be

specified in the Service Agreement.

31.2 New Network Loads Connected With the Transmission Provider: The

Network Customer shall provide the Transmission Provider with as much

advance notice as reasonably practicable of the designation of new

Network Load that will be added to its Transmission System. A

designation of new Network Load must be made through a modification of

service pursuant to a new Application. The Transmission Provider will

use due diligence to install any transmission facilities required to

interconnect a new Network Load designated by the Network Customer. The

costs of new facilities required to interconnect a new Network Load

shall be determined in accordance with the procedures provided in

Section 32.4 and shall be charged to the Network Customer in accordance

with Commission policies.

31.3 Network Load Not Physically Interconnected with the Transmission

Provider: This section applies to both initial designation pursuant to

Section 31.1 and the subsequent addition of new Network Load not

physically interconnected with the Transmission Provider. To the extent

that the Network Customer desires to obtain transmission service for a

load outside the Transmission Provider's Transmission System, the

Network Customer shall have the option of (1) electing to include the

entire load as Network Load for all purposes under Part III of the

Tariff and designating Network Resources in connection with such

additional Network Load, or (2) excluding that entire load from its

Network Load and purchasing Point-To-Point Transmission Service under

Part II of the Tariff. To the extent that the Network Customer gives

notice of its intent to add a new Network Load as part of its Network

Load pursuant to this section the request must be made through a

modification of service pursuant to a new Application.

31.4 New Interconnection Points: To the extent the Network Customer

desires to add a new Delivery Point or interconnection point between

the Transmission Provider's Transmission System and a Network Load, the

Network Customer shall provide the Transmission Provider with as much

advance notice as reasonably practicable.

31.5 Changes in Service Requests: Under no circumstances shall the

Network Customer's decision to cancel or delay a requested change in

Network Integration Transmission Service (e.g. the addition of a new

Network Resource or designation of a new Network Load) in any way

relieve the Network Customer of its obligation to pay the costs of

transmission facilities constructed by the Transmission Provider and

charged to the Network Customer as reflected in the Service Agreement.

However, the Transmission Provider must treat any requested change in

Network Integration Transmission Service in a non-discriminatory

manner. The Transmission Provider will have no obligation to refund any

advance of funds expended for purposes of providing facilities for a

Network Customer. However, upon receipt of a Network Customer's written

notice of such a cancellation or delay, the Transmission Provider will

use the same reasonable efforts to mitigate the costs and charges owed

to the Transmission Provider as it would to reduce its own costs and

charges.

31.6 Annual Load and Resource Information Updates: The Network

Customer shall provide the Transmission Provider with annual updates of

Network Load and Network Resource forecasts consistent with those

included in its Application for Network Integration Transmission

Service under Part III of the Tariff. The Network Customer also shall

provide the Transmission Provider with timely written notice of

material changes in any other information provided in its Application

relating to the Network Customer's Network Load, Network Resources, its

transmission system or other aspects of its facilities or operations

affecting the Transmission Provider's ability to provide reliable

service.

32 Additional Study Procedures For Network Integration Transmission

Service Requests

32.1 Notice of Need for System Impact Study: After receiving a request

for service, the Transmission Provider shall determine on a non-

discriminatory basis whether a System Impact Study is needed. A

description of the Transmission Provider's methodology for completing a

System Impact Study is provided in Attachment D. If the Transmission

Provider determines that a System Impact Study is necessary to

accommodate the requested service, it shall so inform the Eligible

Customer, as soon as practicable. In such cases, the Transmission

Provider shall within thirty (30) days of receipt of a Completed

Application, tender a System Impact Study Agreement pursuant to which

the Eligible Customer shall agree to advance funds

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to the Transmission Provider for performing the required System Impact

Study. For a service request to remain a Completed Application, the

Eligible Customer shall execute the System Impact Study Agreement and

return it to the Transmission Provider within fifteen (15) days. If the

Eligible Customer elects not to execute the System Impact Study

Agreement, its Application shall be deemed withdrawn.

32.2 System Impact Study Agreement and Compensation:

(i) The System Impact Study Agreement will clearly specify the

Transmission Provider's estimate of the actual cost, and time for

completion of the System Impact Study. The charge shall not exceed the

actual cost of the study. In performing the System Impact Study, the

Transmission Provider shall rely, to the extent reasonably practicable,

on existing transmission planning studies. The Eligible Customer will

not be assessed a charge for such existing studies; however, the

Eligible Customer will be responsible for charges associated with any

modifications to existing planning studies that are reasonably

necessary to evaluate the impact of the Eligible Customer's request for

service on the Transmission System.

(ii) If in response to multiple Eligible Customers requesting

service in relation to the same competitive solicitation, a single

System Impact Study is sufficient for the Transmission Provider to

accommodate the service requests, the costs of that study shall be pro-

rated among the Eligible Customers.

(iii) For System Impact Studies that the Transmission Provider

conducts on its own behalf, the Transmission Provider shall record the

cost of the System Impact Studies pursuant to Section 8.

32.3 System Impact Study Procedures: Upon receipt of an executed

System Impact Study Agreement, the Transmission Provider will use due

diligence to complete the required System Impact Study within a sixty

(60) day period. The System Impact Study shall identify any system

constraints and redispatch options, additional Direct Assignment

Facilities or Network Upgrades required to provide the requested

service. In the event that the Transmission Provider is unable to

complete the required System Impact Study within such time period, it

shall so notify the Eligible Customer and provide an estimated

completion date along with an explanation of the reasons why additional

time is required to complete the required studies. A copy of the

completed System Impact Study and related work papers shall be made

available to the Eligible Customer. The Transmission Provider will use

the same due diligence in completing the System Impact Study for an

Eligible Customer as it uses when completing studies for itself. The

Transmission Provider shall notify the Eligible Customer immediately

upon completion of the System Impact Study if the Transmission System

will be adequate to accommodate all or part of a request for service or

that no costs are likely to be incurred for new transmission facilities

or upgrades. In order for a request to remain a Completed Application,

within fifteen (15) days of completion of the System Impact Study the

Eligible Customer must execute a Service Agreement or request service

without an executed Service Agreement pursuant to Section 29.1, or the

Application shall be deemed terminated and withdrawn.

32.4 Facilities Study Procedures: If a System Impact Study indicates

that additions or upgrades to the Transmission System are needed to

supply the Eligible Customer's service request, the Transmission

Provider, within thirty (30) days of the completion of the System

Impact Study, shall tender to the Eligible Customer a Facilities Study

Agreement pursuant to which the Eligible Customer shall agree to

advance funds to the Transmission Provider for performing the required

Facilities Study. For a service request to remain a Completed

Application, the Eligible Customer shall execute the Facilities Study

Agreement and return it to the Transmission Provider within fifteen

(15) days. If the Eligible Customer elects not to execute the

Facilities Study Agreement, its Application shall be deemed withdrawn

and its deposit shall be returned. Upon receipt of an executed

Facilities Study Agreement, the Transmission Provider will use due

diligence to complete the required Facilities Study within a sixty (60)

day period. If the Transmission Provider is unable to complete the

Facilities Study in the allotted time period, the Transmission Provider

shall notify the Eligible Customer and provide an estimate of the time

needed to reach a final determination along with an explanation of the

reasons that additional time is required to complete the study. When

completed, the Facilities Study will include a good faith estimate of

(i) the cost of Direct Assignment Facilities to be charged to the

Eligible Customer, (ii) the Eligible Customer's appropriate share of

the cost of any required Network Upgrades, and (iii) the time required

to complete such construction and initiate the requested service. The

Eligible Customer shall advance funds to the Transmission Provider for

the construction of new facilities and such advance and construction

shall be provided for in a separate agreement. If the construction of

new facilities requires the expenditure of Transmission Provider funds,

such construction shall be contingent upon the availability of

appropriated funds. The Eligible Customer shall have thirty (30) days

to execute a construction agreement and a Service Agreement and provide

the advance payment or request service without an executed Service

Agreement pursuant to Section 29.1 and provide the required letter of

credit or other form of security or the request no longer will be a

Completed Application and shall be deemed terminated and withdrawn.

33 Load Shedding and Curtailments

33.1 Procedures: Prior to the Service Commencement Date, the

Transmission Provider and the Network Customer shall establish Load

Shedding and Curtailment procedures pursuant to the Network Operating

Agreement with the objective of responding to contingencies on the

Transmission System. The Parties will implement such programs during

any period when the Transmission Provider determines that a system

contingency exists and such procedures are necessary to alleviate such

contingency. The Transmission Provider will notify all affected Network

Customers in a time

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