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Staff Report 302-08
City of Palo Alto City Manager’s Report TO:HONORABLE CITY COUNCIL FROM:CITY MANAGER DEPARTMENT: UTILITIES DATE:JULY 21, 2008 CMR: 302:08 SUBJECT:ADOPTION OF A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE THE SECOND AMENDED AND RESTATED NORTHERN CALIFORNIA POWER AGENCY METERED SUBSYSTEM AGGREGATOR AGREEMENT AND TO EXECUTE SUBSEQUENT AMENDMENTS TO THE AGREEMENT AS NEEDED TO CONFORM TO CHANGES IN REGULATORY REQUIREMENTS RECOMMENDATION Staff recommends that Council authorize the City Manager or his designee to execute the Second Amended and Restated Northern California Power Agency (NCPA) Metered Subsystem Aggregator Agreement with the California Independent System Operator Corporation (CAISO). Staff also recommends that Council delegate the authority to the City Manager or designee to execute subsequent amendments to the agreement as needed to conform to changes in regulatory and CAISO Tariff requirements. BACKGROUND The City of Palo Alto is a member of NCPA. NCPA, acting on behalf of the City, schedules the City’s electric load and resources within the CAISO balancing authority area pursuant to the terms of the CAISO Tariff and the Amended and Restated NCPA Metered Subsystem Aggregator Agreement (MSSAA). NCPA and the City have been operating under the terms and conditions of the MSSAA since September 2002 (Resolution No. 8200, adopted July 15, 2002). The City also participates in an aggregated pooling arrangement with other NCPA members, known as "Pool Members" (Cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, and Ukiah; Plumas-Sierra Rural Electric Cooperative; and Port of Oakland). Under this pooling arrangement, the City’s loads and resources are scheduled within an aggregated portfolio that is operated and managed by NCPA. In addition to the general terms and conditions encompassed within the CAISO Tariff, the MSSAA defines a number of specific terms and conditions under which NCPA coordinates the pool’s load-following operations, reliability requirements, scheduling, generation unit operations, and other functions within the CAISO. CMR: 302:08 Page 1 of 3 DISCUSSION The CAISO plans to implement a new market structure, which will change the environment in which the City and NCPA will transact in the CAISO markets, on November 1, 2008. The Market Redesign and Technology Upgrade (MRTU), which has been developed over the past six years and approved by the Federal Energy Regulatory Commission (FERC), is intended to increase the efficiency oft he CAISO’s electric transmission grid operations and overcome flaws in the current market design that were exposed during the 2000-01 electricity market crisis. Some of the key elements of MRTU include: the implementation of a day-ahead market to trade energy and clear congestion on the electric transmission grid; the use of a network model that solves grid constraints before real-time operations; and the use of Locational Marginal Pricing (LMP) as the basis for valuing grid usage charges. MRTU has required significant revisions to the CAISO Tariff, and subsequently requires revisions to the MSSAA. The MRTU Tariff has been approved by FERC pending final testing of the new market software. In order to bring the existing MSSAA into alignment with the new MRTU Tariff, NCPA has been actively working with the CAISO during the past year to revise and update the MSSAA. As a result of this process, a number of provisions of the MSSAA have been modified, deleted, and/or added to reflect the MRTU market design. The provisions changed include, but are not limited to, the following: o o o o o Terminology, References, and Definitions Term and Termination Provisions New and Revised Access and Scheduling Provisions Reliability and Operational Provisions New and Updated Settlement Provisions These changes will be incorporated into the Second Amended and Restated NCPA Metered Subsystem Aggregator Agreement that will be effective under MRTU, and will allow NCPA to continue to manage the NCPA Pool Member loads and resources under the MRTU market structure. While the MSSAA amendments are close to final, the agreement is still subject to further modifications by the CAISO or NCPA. Additionally, the CAISO is sill testing the software to run its MRTU market, and as a result certain elements of the MSSAA revisions, which have to be verified by the MRTU software, have not yet been finalized. However, once the revisions have been finalized, the City, the other NCPA Pool Members, NCPA, and the CAISO will be required to approve and execute the revised MSSAA in a timely manner so as to facilitate the filing of the MSSAA with FERC. In order to ensure the amended MSSAA is effective on MRTU startup, considering the FERC’s 60-day filing requirement and the current November 1, 2008 MRTU implementation date, the MSSAA should be filed with FERC on or before August 31, 2008. RESOURCE IMPACT Following the CAISO’s implementation of its MRTU market design, the costs for delivering the City’s resources to meet the load-serving obligation of the City are projected to increase by CMR: 302:08 Page 2 of 3 approximately $0.4 million per year, with an estimated upper limit of $1 million per year. Staff has anticipated these increases and they have been incorporated in the FY 2008-09 Electric Fund budget and electric rates. POLICY IMPLICATIONS This recommendation is consistent with the Council-approved Utilities Strategic Plan with regard to managing supply portfolio risk to provide stable rates, and to manage business processes cost effectively. This recommendation does not represent a change in current City policies. ENVIRONMENTAL REVIEW The adoption of this resolution does not meet the California Environmental Quality Act’s definition of a project, pursuant to California Public Resources Code Section 21065, therefore no environmental assessment is required. ATTACHMENTS A. Resolution of the Council of the City of Palo Alto Authorizing the City Manager to Execute the Second Amended And Restated NCPA Metered Subsystem Aggregator Agreement and to Execute Subsequent Amendments to the Agreement as Needed to Conform to Changes in Regulatory Requirements B. Second Amended And Restated NCPA MSS Aggregator Agreement - Draft PREPARED BY: Senior Resource Planner REVIEWED BY: DEPARTMENT APPROVAL: CITY MANAGER APPROVAL: JNNE O. RATCHYE l~(ilities Assistant Director, Resource Management VALE~~ONG CMR: 302:08 Page 3 of 3 ***DRAFT - NOT YET ATTACH EN I APPROVED*** RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO AUTHORIZING THE CITY MANAGER OR HIS/HER DESIGNEE TO EXECUTE THE SECOND AMENDED AND RESTATED NORTHERN CALIFORNIA POWER AGENCY METERED SUBSYSTEM AGGREGATOR AGREEMENT AND TO EXECUTE SUBSEQUENT AMENDMENTS TO THE AGREEMENT AS NEEDED TO CONFORM TO CHANGES IN REGULATORY REQUIREMENTS WHEREAS, the City of Palo Alto ("City"), a municipal utility and a chartered city, is a member if the Northern California Power Agency (NCPA); and WHEREAS, NCPA, acting on behalf of the City, schedules the City’s electric load and resources within the California Independent System Operator COrporation (CAISO) balancing authority area pursuant to the terms of the CAISO Tariff and the Amended and Restated NCPA Metered Subsystem Aggregator Agreement (MSSAA); and WHEREAS, NCPA and the City have been operating under the terms and conditions of the MSSAA since September 2002 (City Council Resolution #8200 of July 15, 2002); and WHEREAS, the CAISO is in the process of implementing a new market structure, the Market Redesign and Technology Upgrade (MRTU), that will change the environment in which the City and NCPA will transact in the CAISO markets; and WHEREAS, due to the changes in market structure brought about by MRTU implementation, revisions are required to both the CAISO Tariff and the MSSAA; and WHEREAS, in order to bring the existing MSSAA into alignment with the new MRTU market design, NCPA has been actively working with the CAISO during the past year to revise and update the MSSAA; and WHEREAS, the CAISO is still testing the software to run its MRTU market so the MSSAA revisions, which in part have to be verified against the MRTU software, have not yet been finalized.; WHEREAS, to have the amended MSSAA effective on MRTU startup, allowing for the Federal Energy Regulatory Commission’s (FERC) 60-day filing requirement and based on the current November 1, 2008, MRTU implementation date, the MSSAA should be filed with FERC on or before August 31, 2008; and follows: NOW, THEREFORE, the Council of the City of Palo Alto does RESOLVE as designee Metered SECTION 1. The Council hereby authorizes the City Manager or his/her to execute the Second Amended and Restated Northern California Power Agency Subsystem Aggregator Agreement with the California Independent System Operator 080715 cl 0072430 ***DRAFT - NOT YET APPROVED*** Corporation and to execute subsequent amendments to the MSSA as needed to conform to changes in regulatory and CAISO Tariff requirements. SECTION 2.The Council finds that the adoption of this resolution does not constitute a project under the California Environmental Quality Act and the CEQA Guidelines and, therefore, no environment assessment is required. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Mayor APPROVED: Senior Asst. City Attorney City Manager Director of Utilities Director of Administrative Services 080715 cl 0072430 2 ATTAC DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATIu~ Revised Draft Dated M~V 28~ July 1~ 2008 [NOTE" THE CAISO RESERVES THE RIGHT TO PROPOSE MODIFICATIONS TO THE TERMS OF THIS DRAFT BASED ON ADDITIONAL INTERNAL REVIEW.] [NOTE: NCPA RESERVES THE RIGHT TO PROPOSE ADDITIONAL MODIFICATIONS TO THE TERMS OF THIS DRAFT BASED ON ADDITIONAL INTERNAL REVIEW.] CALIFORNIA INDEPENDENT SYSTEM OPERATOR CORPORATION AND NORTHERN CALIFORNIA POWER AGENCY SECOND AMENDED AND RESTATED NCPA MSS AGGREGATOR AGREEMENT CALIFORNIA IS0 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION TABLE OF CONTENTS ARTICLE I- DEFINITIONS AND INTERPRETATION ................................................................................4 1.1 1.2 1.3 MASTER DEFINITIONS SUPPLEMENT ................................................................................................4 SPECIAL DEFINITIONS FOR THIS AGREEMENT ..................................................................................4 RULES OF INTERPRETATION ............................................................................................................5 ARTICLE II - TERM AND TERMINATION ...................................................................................................6 2.1 EFFECTIVE DATE ............................................................................................................................6 2.2 TERMINATION AND CHANGES IN NCPA MEMBERSHIP ......................................................................6 2.2.1 Termination by Default ..........................................................................................................6 2.2.2 Termination on Notice .......................................................................................~ ...................7 2,2.3 Filing .......................................................................................................................................7 2.2.4 MSS Withdrawal. ....................................................................................................................7 2.2.5 ’ MSS Entry ...............................................................................................................................7 ARTICLE III - GENERAL TERMS AND CONDITIONS ...............................................................................8 3.1 SCOPE OF AGREEMENT ..................................................................................................................8 3.2 CAISO AND NCPA RESPONSIBILITIES ...........................................................................................8 3.2.1 CAISO Responsibility ............................................................................................................8 3.2.2 NCPA Responsibility .............................................................................................................8 3.3 RELATIONSHIP BETWEEN AGREEMENT AND CAISO TARIFF ............................................................9 3.3.1 Precedence of Agreement ....................................................................................................9 3.3,2 Precedence of CAISO Tariff .................................................................................................9 3.3.3 Participating Generators .......................................................................................................9 3.3.4 Participating Loads ...............................................................................................................9 3.3.5 Utility Distribution Companies ......................~ ......................................................................9 3.3.6 Disputes ..................................................................................................................................9 3.3.7 Participating TO ...................................................................................................................10 3.3,8 Written Agreements ..............................................................................................." ..............10 3.4 AMENDMENT TO AGREEMENT .......................................................................................................1 0 3.4.1 Amendments .................................................................................. 3.4,2 Section 205 Rights ..............................................................................................................10 3,4.3 Operational Changes ..........................................................................................................10 3.5 AMENDMENT TO CAISO TARIFF ................................................................................................... 3.5.1 CAISO Tariff Amendments ................................................................................................. 3.5.2 MSS Principles ..................................................................................................................... 3.6 CHANGES TO CONFORM TO FERC ORDERS ..................................................................................11 ARTICLE 4.1 4.2 4.3 4.4 4.5 IV - INTERCONNECTION ..........................................................................................................11 POINTS OF MSS INTERCONNECTION .............................................................................................1 1 INTERCONNECTION OPERATION STANDARDS .................................................................................12 OPERATION, MAINTENANCE, AND LOAD SERVING RESPONSIBILITIES .............................................12 EXPANSION, RETIREMENT, AND MODIFICATION OF FACILITIES ........................................................12 INSTALLATION OF FACILITIES AND RIGHTS OF ACCESS ..................................................................12 4.5.1 Equipment Installation ........................................................................................................12 4.5.2 Rights of Access .................................................................................................................12 4.5.3 Request for Access .............................................................................................................12 ARTICLE V - OPERATIONS ......................................................................................................................13 5.1 OUTAGES ....................................................................................................................................13 ~ CA~m=ORN[A ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 5,1.1 Outage Coordination ...........................................................................................................13 5.1,2 Scheduling Outages ............................................................................................................13 5.1.3 Appficadon of Law ................................................................................. ..............................13 5.2 SAFETY AND RELIABILITY .............................................................................................................13 5.3 CRITICAL PROTECTIVE SYSTEMS ..................................................................................................14 5.4 SINGLE POINT OF CONTACT .........................................................................................................14 5.5 TRANSMISSION LOSSES, OUTAGES, AND CONGESTION ..................................................................14 VI -INFORMATION SHARING .................................................................................................14 6.1 FoREcAsTS .................................................................................................................................14 6.2 SYSTEM SURVEYS AND INSPECTIONS .......................................................... ...................................15 6.3 MAINTENANCE SCHEDULES ...........................................................’ ...............................................15 6.4 RELIABILITY INFORMATION ...........................................................................................................15 6.5 MAJOR OUTAGE REPORTS ...........................................................................................................15 6.6 ANNUAL REVIEWS AND REPORTS .................................................................................................16 6.6.1 CAISO Annual Reviews and Reports ................................................................................16 6.6.2 NCPA Annual Reviews and Reports ..................................................................................16 6.6.3 Joint Reporting ................................’ ....................................................................................f6 6.7 DIRECT TELEMETRY .......; .......... ...................................................................................................16 ARTICLE ARTICLE VII- EMERGENCY OPERATIONS ...........................................................................................16 7.1 7.1.1 7.7.2 7.1.3 7.1.4 7.1.5 7.2 7.3 7.4 7.4.1 7.4.2 7,4.3 7.4.4 7,4.5 7.4.6 7.5 7.5.1 7,5.2 7.5.3 IN GENERAL .................................................................................................................................16 Generating Unit A vailabifity ................................. ...............................................................17 CAISO Dispatch Instructions .............................................................................................18 Compensation ......................................................................................................................19 Communication ...................................................................................................................19 System Emergency Due to Deficiencies ...........................................................................19 NOTICE........................................................................................................................................19 RECORDS ....................................................................................................................................20 LOAD SHEDDING ...........................................................................................................................20 Automatic Load Shedding ..................................................................................................20 Manual Load Shedding ........................................................................................... .............20 Manual Load Shedding Priorities ......................................................................................20 Load Restoration .................................................................................................................21 Coordination ........................................................................................................................21 Supply Levels ......................................................................................................................21 ELECTRICAL EMERGENCY PLAN ...................................................................................................21 Coordination o~ EEP and LAP ............................................................................................21 Notification of Voluntary Load Curtailment ......................................................................21 Notification of Required Load Curtailment .......................................................................22 ARTICLE VIII - LOCAL AND REGIONAL RELIABILITY ..........................................................................22 8.1 RELIABILITY WITHIN NCPA’s SYSTEM ..........................................................................................22 8.1,1 NCPA System Reliability ........................: ............................................................................22 8.1.2 Reliability Generation ..........................................................................................................22 8.1,3 Reliability Support Cost ......................................................................................................22 8.2 BALANCING AUTHORITY AREA RELIABILITY ..................................................................................22 8.2.1 NCPA System Refiability Generation .................................................................................23 8.2.2 Reliability Must-Run Availability ........................................................................................23 8.3 VOLTAGE SUPPORT ..: ..................................................................................................................23 8.4 BLACK START ..............................................................................................................................23 8.5 ANCILLARY SERVICES ..................................................................................................................23 ARTICLE IX - ACCESS & SCHEDULING .................................................................................................24 ii CALIFORNIA NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 9.2.1 9.2.2 9.2.3 9.2.4 9.3 EXISTING CONTRACTS AND ENCUMBRANCES AND ACCESS TO THE CAISO CONTROLLED GRID ..........24 9.1,1 Settlement Agreement ........................................................................................................24 9.1.2 Open Access to CAISO Controlled Grid ...........................................................................24 9.1.3 Use of CAISO Controlled Grid ............................................................................................24 9.1,4 Open Access to NCPA System ..........................................................................................24 ACCESS TO CAISO MARKETS ..........................................................................................................25 Energy, Ancillary Services and RUC Capacity .........i .......................................................25 Participation in the Integrated Forward Market .................................................................25 Schedufing Timelines ..........................................................................................................25 Black Start and Voltage Support .......................................................................................26 CONGESTION REVENUE RIGHTS ....................................................................................................26 ARTICLE X - GENERATING UNITS AND PARTICIPATING LOADS ......................................................26 10,1 IDENTIFICATION OF RESOURCES ...................................................................................................26 10.1,1 Technical Characteristics ...............................................................................................26 10.1.2 Notification of Changes ..................................................................................................26 10,1,3 Generating Unit Limitations ...........................................................................................27 10.2 GENERATING UNIT OPERATION .....................................................................................................27 10,2.1 Generating Unit Telemetry .............................................................................................27 10.2,2 Regulation Ancillary Service ..........................................................................................27 10.3 CAISO AUTHORITY TO DISPATCH NCPA RESOURCES ...................................................: ..............27 10.4 WECC REQUIREMENTS APPLICABLE TO PARTICIPATING GENERATORS .........................................28 10.4.1 Refiability Criteria ............................................................................................................28 10.4,2 Payment of WECC Sanctions .........................................................................................28 ARTICLE Xl - METERING ..........................................................................................................................28 11.1 11.2 11.3 CAISO CERTIFIED REVENUE QUALITY METERING .........................................................................28 ~M~ETERING REQUIREMENTS ...............................................................: .........................................:. 28 NCPA SQMD CALCULATION. ......................................................................................................28 ARTICLE Xll - CHARGES ..........................................................................................................................28 12.1 12.2 12.3 12.4 12.5 12.6 12.7 CHARGES GENERALLY ...................................................................................................¯ ..............28 CONGESTION MANAGEMENT .........................................................................................................29 UNACCOUNTED-FOR ENERGY COSTS ...........................................................................................29 RELIABILITY GENERATION ............................................................................................................29 NEUTRALITY COSTS .....................................................................................................................29 CAISO BALANCING AUTHORITY AREA SUMMER RELIABILITY COSTS .............................................29 GENERATING UNIT MINIMUM LOAD AND START-UP COSTS ............................................................30 12,7.1 Election to Receive Minimum Load and Start-Up Compensation ..............................30 12.7,2 Election Not to Receive Minimum Load and Start-Up Compensation .......................30 12.8 ALLOCATION OF NET IFM BID COST RECOVERY UPLIFT .............................................. ..................30 12,8,1 Tier I IFM Bid Cost Recovery Uplift ............................ ..................................................31 12.8,2 Tier 2 IFM Bid Cost Recovery Upfift ...............................................................................31 12.9 12.10 12.11 12.12 12.13 12.14 12.15 12.16 12.17 12.18 12.19 ALLOCATION OF NET RTM BID COST RECOVERY UPLIFT ..............................................................31 GRID MANAGEMENT CHARGES BASED ON UNINSTRUCTED IMBALANCE ENERGY ........................32 GRID MANAGEMENT CHARGES BASED ON INSTRUCTED IMBALANCE ENERGY ............................32 MSS DEVIATION BAND ............................................................................................................33 LOAD FOLLOWING DEVIATION BAND COMPLIANCE ....................................................................33 DEVIATION BAND PENALTIES CALCULATION .............................................................................33 OPERATING AND MAINTENANCE COSTS ....................................................................................34 BILLING AND PAYMENT ............................................................................................................34 MSS NET NEGATIVE UNINSTRUCTED DEVIATION ......................................................................34 RESIDUAL UNIT COMMITMENT ..................................................................................................34 EMISSIONS COSTS ...................................................................................................................34 iii CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION ARTICLE 13.1 13.2 ARTICLE 14.1 ARTICLE 15.1 15.2 15.3 ARTICLE 16,1 ARTICLE 17.1 ARTICLE 18.1 18.2 18.3 18.4 18.5 18.6 18.7 18.8 XlII- PENALTIES AND SANCTIONS .......................................................................................35 PENALTIES ..................................................................................................................................35 CORRECTIVE MEASURES ..............................................................................................................35 XlV - DISPUTE RESOLUTION ..................................................................................................35 DISPUTE RESOLUTION .......35 XV - REPRESENTATIONS AND WARRANTIES .....................................................................36 REPRESENTATIONS AND WARRANTIES ..................................................................." .......................36 NECESSARY APPROVALS .............................................................................................................36 NCPA REPRESENTATION OF MSS MEMBERS ..................................................................’ .............36 XVl - LIABILITY AND INDEMNIFICATION ..............................................................................36 LIABILITY AND INDEMNIFICATION ...................................................................................................36 XVII- UNCONTROLLABLE FORCES .............................. ........................................... .............36 UNCONTROLLABLE FORCES .........................................................................................................36 XVlll- MISCELLANEOUS .........................................................................................................36 NOTICES ......................................................................................................................................37 WAIVERS ......................................: ..............................................................................................37 GOVERNING LAW AND FORUM ......................................................................................................37 MERGER ......................................................................................................................................37 COUNTERPARTS ..........................................................................................................................37 CONSISTENCY WITH FEDERAL LAWS AND REGULATIONS ...............................................................37 SEVERABILITY ..............................................................................................................................38 ASSIGNMENTS .............................................................................................................................38 SCHEDULE 1 - NCPA’S SYSTEM FACILITIES .......................................................................................40 SCHEDULE 2 - INTERCONNECTED OPERATION STANDARDS .........................................................43 SCHEDULE 3 - RIGHTS OF ACCESS TO FACILITIES ...........................................................................47 SCHEDULE 4 - MAINTENANCE COORDINATION .................................................................................49 SCHEDULE 5 - CRITICAL PROTECTIVE SYSTEMS ..............................................................................50 SCHEDULE 6 - OPERATIONAL CONTACT ............................................................................................51 SCHEDULE 7 - EMERGENCIES ................................................................................................................52 SCHEDULE 7.1 - COMPENSATION FOR EMERGENCY DISPATCH INSTRUCTIONS ........................53 SCHEDULE 8 - UNDERFREQUENCY LOAD SHEDDING .......................................................................56 SCHEDULE 9 - OTHER AUTOMATIC LOAD SHEDDING .......................................................................58 SCHEDULE 10- MANUAL LOAD SHEDDING ............. ...........................................................................59 SCHEDULE 10A - ROTATING LOAD CURTAILMENT PROCEDURES .................................................60 SCHEDULE 10B - INTERRUPTIBLE LOAD .............................................................................................61 iv NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 11 - EMERGENCY ACTION PLAN ......................................................................................62 SCHEDULE 12 - LOAD RESTORATION ..................................................................................................72 SCHEDULE 13 - EXISTING CONTRACTS, ENCUMBRANCES AND TRANSMISSION OWNERSHIP RIGHTS .......................................................................................................................................................74 SCHEDULE 14 - GENERATING UNITS AND PARTICIPATING LOADS ................................................76 SCHEDULE 15 - METERING OBLIGATIONS ..........................................................................................84 SCHEDULE 16 - TRANSMISSION RELIABILITY CRITERIA ..................................................................90 SCHEDULE 17 -NOTICES ........................................................................................................................92 SCHEDULE 18 - MSS MEMBERS ............................................................................................................94 SCHEDULE 19 - MSSA LOAD FOLLOWING DEVIATION ENERGY FORMULA ...................................95 v CALIFORNIA ISO NCPA MSS AGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION CALIFORNIA INDEPENDENT SYSTEM OPERATOR CORPORATION AND NORTHERN CALIFORNIA POWER AGENCY SECOND AMENDED AND RESTATED NCPA MSS AGGREGATORAGREEMENT THIS AGREEMENT is dated this into, by and among: __ day of ,20 and is entered Northern California Power Agency, a joint powers agency organized under the laws of the State of California, having its registered and principal place of business located at 651 Commerce Drive, Roseville, California 95678 ("NCPA"); and (2)California Independent System Operator Corporation,a California non-profit public benefit corporation having its principal place of business located in such place in the State of California as the CAISO Governing Board may from time to time designate, initially 151 Blue Ravine Road, Folsom California 95630 (the "CAISO"). and (3)NCPA MSSAA Members, the subset of NCPA Members that are listed in Schedule 18. NCPA, the CAISO and the MSSAA Members are hereinafter referred to individually as "Party" or collectively as the "Parties." The City of Santa Clara, California, a duly chartered city under the laws of the State of California, which does business as Silicon Valley Power ("SVP"), is a member of NCPA, but has a separate Mss Agreement with the CAISO. NCPA currently serves as Scheduling Coordinator for SVP, and some of NCPA’s functions in that capacity are addressed in this Agreement. However, SVP is not a signatory to this Agreement. Whereas: Ao NCPA and the MSS Members are engaged in, among other things, generating and transmitting electric power in Northern California, and distributing electric power in the Service Areas of the MSS Members comprising NCPA’s System, CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT F= DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION with NCPA serving as the MSS Aggregator for the Metered Subsystem of each MSS Member; The CAISO, a North American Electric Reliability Corporation ("NERC") certified Balancing Authority, or a Balancing Authority certified by NERC’s successor, is engaged in, among other things, exercising Operational Control over certain electric transmission facilities forming the CAISO Controlled Grid, scheduling transactions that utilize those transmission facilities and, operating certain markets, including markets for Energy and Ancillary Services, pursuant to the terms of the CAISO Tariff and has certain statutory obligations under California law to maintain the reliability of the CAISO Controlled Grid, as well as certain NERC and Western Electricity Coordinating Council ("WECC"), or their successors, mandated responsibilities to ensure the reliable operation of the entire electric grid within the CAISO Balancing Authority Area; NCPA’s System is within the CAISO Balancing Authority Area and is interconnected to the CAISO Controlled Grid; NCPA, the MSSAA Members and SVP desire to continue to operate the generation, transmission and distribution resources of NCPA’s System in an integrated manner to reliably serve the Loads Of each MSSAA Member and SVP and also desire, as or through a Scheduling Coordinator, to schedule transactions using the CAISO Controlled Grid and participate in the CAISO’s markets as a buyer and a seller; The Parties are entering into this Agreement in order to establish the terms and conditions on which (1) NCPA will operate NCPA’s System electric resources within the CAISO Balancing Authority Area; (2) NCPA will, as or through a Scheduling Coordinator, schedule transactions using the CAISO Controlled Grid and participate in the CAISO’s markets; and (3) the Parties will meet their obligations under the CAISO Tariff, as may be modified by this Agreement, in connection therewith; NCPA intends to continue to utilize NCPA’s System resources to follow the Load of MSSAA Members and SVP, make economic resource decisions, and the intent of the Parties is that any CAISQ charges will be charged to NCPA’s Scheduling Coordinator based on the principle of cost causation, with due regard for historic considerations, timing and transition issues, and other relevant factors; In order to maintain the reliability of the interconnected electric systems encompassed by the WECC, the Parties are required to comply with the NERCNVECC Reliability Standards applicable to the functional entity types for which the Parties are registered with NERC and WECC, and, should either fail to 2 ~ CALIt~OI:(N[A ISO NCPAMSSAGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION meet their respective obligations, each Party shall be responsible for. payment of any monetary sanctions assessed against it in accordance with Section 10.4; NCPA is a specially organized agency under the Constitution of the State of California and utilizes tax-exempt financing for one or more of its projects that restricts the amount of private use of such projects; and NCPA and the MSSAA Members represent that they have a responsibility to serve their customer Loads pursuant to California Public Utilities Code Section 10005. NOW THEREFORE, in consideration of the mutual covenants set forth herein, THE PARTIES AGREE as follows: CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION ARTICLE I DEFINITIONS AND INTERPRETATION 1.1 1.2 Master Definitions Supplement. Unless defined in the introduction or Section 1.2 of this Agreement, all terms used in this Agreement with initial capitalization shall have the same meaning as those contained in the Master Definitions Supplement to the CAIS© Tariff. Special Definitions for this Agreement. In this Agreement, the following terms shall have the meanings set opposite them: "NCPA Joint Powers Agreement" means the agreement dated July 19, 1968, as amended, entered pursuant to Chapter 5, Division 7, Title 1 of the California Government Code commencing with Section 6500 in which two or more public agencies may by this agreement jointly exercise any power common to the contracting parties. "NCPA’s System"means all transmission and distribution facilities owned or controlled by NCPA and the MSS Members, and all Generating Units within the CAISO Balancing Authority Area owned or controlled by NCPA and the MSS Members. A description of the Generating Units and Points of MSS Interconnection comprising NCPA’s System is set forth in Schedule 1 and Schedule 14. "MSS Members" means those NCPA members who are signatories to a Metered Subsystem Agreement. MSS Members are listed in Schedule 18 of this Agreement. "MSSAA Members" means a specific subset of MSS Members who are subject to this Metered Subsystem Aggregator Agreement and who have not additionally signed a separate Metered Subsystem Agreement. MSSAA Members are listed in Schedule 18 of this Agreement. "Point of MSS Interconnection" means any point at which the Generating Units and Service Areas of NCPA and the MSS Members that are part of NCPA’s System are directly interconnected with the CAISO Controlled Grid or with any other portion of the interconnected electric grid in the CAISO Balancing Authority Area. The initial Points of MSS Interconnection are described in Section 4.1. "PG&E IA" means the Interconnection Agreement between NCPA and PG&E designated as First Revised Service Agreement No. 17 under PG&E FERC Electric Tariff, Sixth Revised Volume No. 5, as it may be amended from time to time. ~ CALI[UOR]’,IIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 1.3 "Settlement Agreement" means the Settlement Agreement among Pacific Gas and Electric Company, Northern California Power Agency, Silicon Valley Power of Santa Clara, California, the City of Roseville, California and the California Independent System Operator Corporation in FERC Dockets ER01-2998-000, ER02-358-000, and EL02-64-000, as accepted by FERC. "SVP" means Silicon Valley Power, which has signed an individual MSS agreement with the CAISQ, but for which NCPA acts as Scheduling Coordinator, including implementation of such individual MSS agreement, pursuant to the Scheduling Coordination Program Agreement between NCPA and SVP. "Underfrequency Load Shedding" or "UFLS" means automatic Load Shedding, accomplished by the use of such devices as underfrequency relays, intended to arrest frequency decline and assure continued operation within anticipated islands. Rules of Interpretation. The following rules of interpretation and conventions shall apply to this Agreement: (a) the singular shall include the plural and vice versa; (b)the masculine shall include the feminine and neutral and vice versa; (c) (d) (e) (0 "includes" or "including" shall mean "includes (or including) without limitation"; (g) references to a Section, Article or Schedule shall mean a Section, Article or a schedule of this Agreement, as the case may be, unless the context otherwise requires; any reference to the CAISO Tariff or any provision of the CAISO Tariff will mean a reference to the CAISO Tariff or provision then in effect as modified during the term of this Agreement, unless otherwise specifically provided; unless the context otherwise requires, references to any law shall be deemed references to such law as it may be amended, replaced or restated from time to time; unless the context otherwise requires, any reference to a "person" includes any individual, partnership, firm, company, corporation, joint venture, trust, association, organization or other entity, in each case whether or not having separate legal personality; NCPA MSS AGG REGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION (h)unless the context otherwise requires, any reference to a Party includes a reference to its permitted successors and assigns; (i)any reference to a day, week, month or year is to a calendar day, week, month or year; the captions and headings in this Agreement are inserted solely to facilitate reference and shall have no bearing upon the interpretation of any of the terms and conditions of this Agreement; (k)all references to "NCPA" herein shall be deemed to refer to the joint powers agency organized under the laws of the state of California as created by the NCPA Joint Powers Agreement unless otherwise indicated 2.1 ARTICLE II TERM AND TERMINATION Effective Date. This Agreement shall be effective as of: (1) the date this Agreement is accepted for filing and made effective by FERC, and (2) the date the CAIS©’s Market Redesign and Technology Upgrade ("MRTU") market design becomes effective and shall remain in full force and effect until terminated pursuant to Section 2.2, or upon such other date as the Parties shall mutually agree. If MRTU has become effective but this Agreement has not yet been made effective by FERC, the Parties will use the terms of this Agreement to interpret and implement the MRTU Tariff and the terms of the existing Metered Subsystem Aggregator Agreement, to effectuate the intention of the Parties until such time as this Agreement is made effective by FERC. If this Agreement has become effective, but the CAISO exercises its rights under Section 44 of the CAISO Tariff and returns its operations and settlements to the pre-MRTU Tariff, the Parties will use the terms of the version of the Metered Subsystem Aggregator Agreement in existence prior to this Agreement during such period that the CAIS© returns to the previously effective CAISO Tariff to interpret and implement the pre-MRTU Tariff, except that the updated version of Schedules 1, 6, 11, 13, 14, 15.1 and 17, attached to this Agreement will remain in effect. Termination and Changes in NCPA Membership Termination by Default. NCPA or the CAISO (the terminating Party) may terminate this Agreement by giving written notice of termination in the event that the other Party (the defaulting Party) commits any default under this Agreement or the applicable provisions of the CAISO Tariff which, if capable of being remedied, is not remedied within 30 days after the terminating Party has 6 CALIFORNIA- ISO NCPA MSS AGGR EGATOR AGREEMENT 2.2.2 2.2.3 2.2.4 2.2.5 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION given the defaulting Party written notice of the default, unless excused by reason of Uncontrollable Forces under Article XVll of this Agreement. Termination on Notice. NCPA or the CAISO (the terminating Party) shall have the right to terminate this Agreement in accordance with this Section 2.2.2, subject to the procedural requirements set forth in Section 2.2.3. NCPA or the CAISO may terminate this Agreement by giving the other Party written notice at least twelve (12) months in advance of the intended effective date of termination. Filing. With respect to any notice of termination given pursuant to this Section, the CAISO must file a timely notice of termination with FERC. The filing of the notice of termination by the CAISO will be considered timely if: (1) the request to file a notice of termination is made after the preconditions for termination have been met, and (2) the CAISO files the notice of termination within 30 days of receipt of such request from NCPA or issuance of its own notice of termination. This Agreement shall terminate upon the date on which the notice of termination is permitted by FERC to become effective. MSS Withdrawal. If any MSSAA member or SVP elects to terminate its MSS relationship with the CAISO or its Scheduling Coordinator agreement with NCPA, NCPA will provide notice of such change to the CAISO within five business days of its receipt of the notice of such election. As of the date of such notice to the CAISO, NCPA will develop in a timely manner and propose to CAISO amendments to this Agreement that would permit continued operation without the MSSAA member or SVP that has given notice to NCPA, or to give a notice of termination to be effective at least twelve (12) months after NCPA’s receipt of such notice, or to be effective on a date that is mutually acceptable amongst the Parties. MSS Entry. In the event that NCPA wishes to add a new member to this Agreement, or if a new member executes a separate MSSAgreernent with the CAI$O and wishes NCPA to act as its Scheduling Coordinator for the purposes of aggregate dispatch consistent with this Agreement, NCPA shall promptly notify the CAISO and provide CAISO with proposed amendments to this Agreement and the Schedules of this Agreement that would be necessary to implement such a change. Within thirty days of the provision of such documents, NCPA and CAISO will meet to discuss the proposed changes. CAISO’s consent to the addition of new MSSAA or MSS Members shall not be unreasonably withheld. 7 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 3.1 3.2.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION ARTICLE III GENERAL TERMS AND CONDITIONS Scope of Agreement. Except as specifically provided otherwise, the provisions of this Agreement will apply only with respect to the facilities comprising NCPA’s System, the facilities of MSS Members, and Loads and Generating Units of MSS Members directly connected only to NCPA’s System. NCPA is acting as MSS Aggregator on behalf of the multiple, geographically contiguous Metered Subsystems of the MSSAA Members and on behalf of SVP to the extent agreed upon between NCPA and SVP for implementation of SVP’s individual MSS Agreement. To the extent MSS Members have entitlements to Generating Units with Third Parties, this Agreement does not apply to such Third Parties. For the purposes of this Section 3.1, "Third Party" means any party other than NCPA, MSSAA Members, and the CAISO. Subject to the terms of Article II, this Agreement shall not affect NCPA or MSS Members’ ability to join or establish another Balancing Authority Area or NCPA’s right to exercise any available legal recourse to obtain or confirm that it possesses other forms of transmission rights. CAISO and NCPA Responsibilities. CAISO Responsibility. The Parties acknowledge that the CAISO is responsible for the efficient use and reliable operation of the CAISO Controlled Grid and the operation of the CAISO’s Balancing Authority Area consistent with achievement of planning and Operating Reserve criteria no less stringent than those established by the WECC and NERC Reliability Standards and criteria and in accordance with the CAISO Tariff and further acknowledge that the CAISO may not be able to satisfy fully these responsibilities if parties to agreements with the CAISO, including NCPA, fail to comply fully with all of their obligations under those agreements. NCPA Responsibility. The Parties acknowledge that NCPA, acting as the MSS Aggregator, has a legal obligation to act in the best interests of all its members that are signatories to the NCPA Joint Powers Agreement. The Parties further acknowledge that NCPA members that are not signatories to MSS Agreements with the CAISO may have legal rights to the use and output of Generating Units and transmission facilities owned or controlled by NCPA and that these rights cannot be altered or diminished by this Agreement. The Parties acknowledge that NCPA and the MSSAA Members are individualiy responsible for compliance with the WECC and NERC Reliability Standards and criteria applicable to the functions for which NCPA and each MSSAA Member are respectively registered with NERC. The references to WECC and NERC Reliability Standards throughout this Agreement do not make any alteration or enlargement of the requirements or standards applicable to NCPA CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION and the individual MSSAA Members beyond their individual registrations with NERC. 3,3 3.3.1 3.3.2 3.3.3 3.3.4 3.3.5 3.3.6 Relationship Between Agreement and CAISO Tariff Precedence of Agreement. If and to the extent a matter is specifically addressed by a provision of this Agreement (including any schedules or other attachments to this Agreement), the provisions of this Agreement shall govern notwithstanding any inconsistent provision of the CAISO Tariff (including, except as provided in Section 3.3.2, any CAISO Tariff provision that is referenced in this Agreement). Precedence of CAISO Tariff. If and to the extent this Agreement provides that a matter shall be determined in accordance with the applicable provisions of the CAISO Tariff, the applicable provisions of the CAISO Tariff shall govern. Participating Generators. Except as provided in Section 3.3.1, NCPA shall, with respect to the operation of any of the Generating Units listed in Schedule 14, comply with the requirements applicable to Participating Generators under Section 4.6 of the CAISO Tariff and all other provisions of the CAISO Tariff governing Participating Generators. Nothing in this Agreement shall obligateNCPA to execute a Participating Generator Agreement With respect to any NCPA or MSS Member Generating Unit. Participating Loads. Except as provided in Section 3.3.1, NCPA and the MSSAA Members shall, with respect to the operation of any Load listed in Schedule 14, comply with the requirements applicable to Participating Loads under Section 4.7 of the CAISO Tariff and all other provisions of the CAISO Tariff governing Participating Loads. Nothing in this Agreement shall obligate NCPA or any MSSAA Member to execute a Participating Load Agreement with respect to the Load of any MSS Member. Utility Distribution Companies. Except as provided in Section 3.3.1, NCPA and the MSSAA Members shall, with respect to the operation of the distribution facilities belonging to any MSSAA Member, comply with the requirements applicable to Utility Distribution Companies under Section 4.4 of the CAISO Tariff. Nothing in this Agreement shall obligate NCPA or any MSSAA Member to execute a UDC Operating Agreement. Disputes. The applicability of any provision of the CAISO Tariff to NCPA or to an MSSAA Member, including as provided in Sections 3.3.1 through 3.3.5, inclusive, shall, in the event of a dispute between the Parties, be determined through the CAISO ADR Procedures in accordance with Section 13 of the CAISO Tariff. CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 3,3.7 3.3.8 3.4.2 3.4.2.1 3.4.2.2 3.4.3 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Participating TO. Nothing in this Agreement shall preclude NCPA or the MSSAA Members from becoming a Participating TO by executing the TCA and fulfilling all other applicable requirements. If NCPA becomes a Participating TO, it shall comply with the requirements applicable to Participating TOs under Section 4.3 of the CAISO Tariff or any settlement of FERC Docket No. ER00- 2019. Written Agreements. This Agreement shall serve, with respect to NCPA and the MSSAA Members, as the written agreements required by Sections 4.4, 4.6, 4.7, and 10.1.4 of the CAISO Tariff. Amendment to Agreement Amendments. Except with respect to the CAISO’s rights set forth in Section 3.4.2 of this Agreement, this Agreement may be modified only by mutual written agreement between the Parties. Amendments that require FERC approval shall not take effect until FERC has accepted such amendments for filing and made them effective. This shall not modify NCPA’s or the CAISO’s rights under Section 206 of the Federal Power Act. Section 205 Rights. The CAISO shall have the right to apply unilaterally under Section 205 of the Federal Power Act to change the rates, terms, and conditiohs under this Agreement for services provided to NCPA. In proposing any changes, unless in response to a FERC order as provided in Section 3.6, the CAISO will consider the principles in this Agreement as detailed in Section 3.5.2. Additionally, unless in response to a FERC order as provided in Section 3.6, any changes proposed by the CAISO shall be subject to the following: The CAISO shall provide NCPA 30 days advance written notice of such change. The CAISO shall meet and confer with NCPA regarding the change, provided that the scheduling of such meeting shall not be unreasonably delayed. NCPA may waive these requirements upon written request by the CAISO. The CAISO shall provide NCPA with a copy of the FERC filing if, and when, made. Operational Changes. In addition to changes that may otherwise be contemplated by Section 3.6, the Parties recognize that their responsibilities and operations may change duringthe term of this Agreement. The Parties agree that, in the event any such change substantially affects the allocation of rights, responsibilities, and obligations between the Parties under this Agreement, the Parties, while continuing to honor the terms and conditions of 10 ~ CA~.~FO~{NIA ISO NCPA MSS AGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION this Agreement, will make good faith efforts to negotiate an appropriate amendment to this Agreement and shall endeavor in that process to restore that allocation. 3.5.2 3.5.2.1 3.5.2.2 3.5.2.3 3.6 Amendment to CAISO Tariff. CAISO Tariff Amendments. Nothing in this Agreement shall affect in any way the authority of the CAISO to modify unilaterally the CAISO Tariff in accordance with Section 15 of the CAISO Tariff or of the CAISO and NCPA or the MSSAA Members to exercise their rights under the Federal Power Act or any other law or to pursue any legal remedies. MSS Principles. In making amendments to the CAISO Tariff as provided in Section 3.5.1, the CAISO will consider the impact on Metered Subsystems and the principles reached in this Agreement, including but not limited to: Cost Causation: The intent of the Parties is that CAISO charges will be charged to the Scheduling Coordinator for the MSS Aggregator, based on the principle of cost causation, with due regard for historic considerations, timing and transition issues, and other relevant factors. Load Following Capability: NCPA desires to maintain Load following capability to match the Loads of the MSS Members, and to make economic resource decisions with the resources in NCPA’s portfolio. Compatibility of Market Participants: For efficient use of transmission facilities and to decrease Congestion, the CAISO desires that all Market Participants operate using similar rules and Scheduling timelines. Changes to Conform to FERC Orders. Nothing in this Article III shall be interpreted to limit the CAISO’s right to modify the CAISO Tariff or this Agreement to comply with or conform to any FERC order. 4.1 ARTICLE IV INTERCONNECTION Points of MSS Interconnection. The Points of MSS Interconnection are described in Schedule 1. Additional Points of MSS Interconnection may be established only by mutual agreement of the Parties, for which consent shall not unreasonably be withheld. 11 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 4.2 4.3 4.4 4.5.2 4.5.3 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Interconnection Operation Standards. The CAISO and NCPA shall maintain stable established operating parameters and control power and reactive flow within standards stated in Schedule 2. Operation,Maintenance, and Load Serving Responsibilities. NCPA or the MSS Members, as appropriate, shall operate and maintain all facilities forming any part of NCPA’s System, and shall be responsible for the supply of the Energy and Ancillary Services required to reliably provide electric service to the Loads connected to NCPA’s System as described in Section 3.1 within the CAISO Balancing Authority Area in accordance with Applicable Reliability Criteria, including WECC and NERC Reliability Standards and criteria as set out in Section 3.2.2 of this Agreement. Expansion, Retirement, and Modification of Facilities. NCPA and the MSSAA Members shall coordinate with the CAISO in the planning and implementation of any expansion, retirement, or modification of those facilities forming parts of NCPA’s System that are identified in Schedule 1, replacements for such facilities, and other facilities forming parts of NCPA’s System that serve similar functions or that otherwise will or may significantly affect the Points of MSS Interconnection, and shall provide sufficient advance notice to enable the CAISO to conduct any necessary studies. To the extent CAISO determines studies are required, those studies will be performed in a reasonable period of time. The Parties will amend Schedule 1, as necessary, should a new Point of MSS Interconnection be established in accordance with Section 4.1. Installation of Facilities and Rights of Access Equipment Installation. Pursuant to Schedule 3, the Parties shall permit one another, on reasonable notice and with mutual agreement in each case, to install equipment or have installed equipment or other facilities on the property of the other Party to enable the installing Party to meet its service obligations, unless doing so would negatively impact the reliability of service provided by the owning Party. Unless otherwise agreed, all costs of installation shall be borne by the installing Party. Rights of Access. A Party installing equipment on the property of the other Party shall be granted, free of charge, reasonable rights of access to inspect, repair, maintain and upgrade that equipment. Access shall be provided only on prior notice and such access shall not be unreasonably withheld. Request for Access. Notwithstanding any other provision in this Section 4.5, NCPA and the MSSAA Members shall provide the CAISO with access for inspection or audit, to any equipment or other facilities of NCPA’s System-listed in Schedule 1, the operation of which affects any Point of MSS Interconnection or the CAIS© Controlled Grid, without prior notice during normal working hours, 12 ~ CALIFO~{NIA ISO NCPAMSSAGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 8:00 a.m. to 5:00 p.m. Monday through Friday, excluding NERC defined holidays. For access for inspection or audit during times outside of normal working hours, the CAISO shall provide NCPA with one (1) Business Day advance notice. A shorter advance notice time may be attained subject to mutual agreement of the Parties. A NCPA Supervisor is to be present at anytime access is granted to any equipment or other facilities of NCPA’s System the operation of which affects any Point of MSS Interconnection or the CAISO Controlled Grid. ARTICLE V OPERATIONS 5.1 5.1.1 5.1.2 5.1.3 5.2 Outages Outage Coordination. NCPA shall coordinate Outages of Generating Units and transmission facilities, including the Points of MSS Interconnection, constituting parts of NCPA’s System with the operators, and if mutually agreed by the CAISO and NCPA, the owners of the transmission facilities with which NCPA’s System is interconnected so that each of those owners can take those Outages into account in coordinating maintenance of its transmission facilities with the CAISO. Scheduling Outages. NCPA shall schedule with the CAISO on an annual basis, pursuant to Schedule 4, with updates submitted as required under CAISO Tariff Section 9.3.6, any Maintenance Outages of the equipment included in Schedule 1, and shall coordinate the Outage requirements of NCPA’s System with the Participating TO with which NCPA’s System is interconnected. Application of Law. Notwithstanding anything to the contrary in this Agreement, to the extent required by any valid law, regulation or order issued by any state or federal authority having jurisdiction over NCPA or NCPA’s System, which law, regulation or order applies to entities that have executed a written undertaking required by Section 4.6 of the CAISO Tariff, NCPA shall coordinate Outages of Generating Units and transmission facilities constituting parts of NCPA’s System with the CAISO, pursuant to any generally applicable program established by the CAISO to implement such law, regulation or order. Safety and Reliability. As set out in Section 3.2.2 of this Agreement, NCPA or the MSSAA Members, as applicable, shall operate and maintain NCPA’s System in accordance with applicable safety standards and Reliability Standards, WECC and NERC requirements as applicable, regulatory requirements, operating guidelines, and Good Utility Practice so as to avoid any material unplanned-for adverse impact on the CAISO Controlled Grid. As set forth in Section 3.2.1 of 13 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION this Agreement, the CAISO shall operate and maintain the CAISO Controlled Grid and the operation of the CAISO Balancing Authority Area in accordance with applicable safety standards and Reliability Standards pursuant to WECC and NERC requirements as applicable, regulatory requirements, operating guidelines, and Good Utility Practice so as to avoid any material unplanned-for adverse impact on NCPA’s System. Without limiting the foregoing, NCPA or its MSSAA Members as applicable, shall operate and maintain NCPA’s System, during normal and System Emergency conditions, in compliance with NCPA’s Emergency Action Plan ("EAP") and the requirements applicable to Utility Distribution Companies in CAISO Operating Procedures and standards. 5.3 5.4 Critical Protective Systems. NCPA will coordinate with the CAISO, PG&E, and any Generators on NCPA’s System to ensure that CAISO Controlled Grid Critical Protective Systems, including relay systems and other systems described in Schedule 5 are installed and maintained in order to function in a coordinated and complementary fashion with protective devices installed by NCPA, PG&E, and Generators. NCPA shall notify the CAISO as soon as is reasonably possible of any condition that it becomes aware of that may compromise or affect the operating safety and reliability of the CAISO Controlled Grid Critical Protective Systems, including the systems described in Schedule 5. Single Point of Contact. The CAIS© and NCPA shall each provide a single point of contact at all hours for the exchange of operational procedures and information. In the case that NCPA is also a Participating TO, there may be only one single point of contact required.and, in the reasonable discretion of the CAISO, duplicative reporting requirements and functions may be waived. The initial points of contact are set forth in Schedule 6. A Party must update the information in Schedule 6 as the information changes. Changes to Schedule 6 shall not constitute an amendment to this Agreement. 5.5 Transmission Losses, Outages, and Congestion. NCPA shall be responsible for transmission losses within any MSS Mernber’s Service Area and to any Points of MSS Interconnection. In addition, NCPA shall be responsible for transmission li~e Outages and transmission Congestion within any MSS Member’s Service Area. This Section 5.5 does not affect Congestion on the CA]SO Controlled Grid, which shall be managed in accordance with the CAISO Tariff. 6.1 ARTICLE Vl INFORMATION SHARING Forecasts. NCPA shall provide to the CAISO annually its ten-year forecasts of the MSS Demand growth, internal Generation, and expansions of or replacements for those transmission facilities that are part of NCPA’s System 14 ~ CALIFORNIA I~;O NCPA MSS AGGREGATOR AGREEMENT 6.2 6.3 6.4 6.5 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION identified in Schedule 1 and other transmission facilities that are part of NCPA’s System that serve similar functions or that otherwise will or may significantly affect any Point of MSS Interconnection. Such forecast shall be provided on the date that Utility Distribution Companies are required to provide similar forecasts in accordance with the CAISO Tariff. Peak MSS Demand forecasts for MSS Members shall be submitted by NCPA’s Scheduling Coordinator in accordance with Section 19.1 of the CAISO Tariff, or biannually as part of the CAISO’s summer and winter assessment process, as agreed by the Parties. System Surveys and Inspections. NCPA and the CAISO shall cooperate to perform system surveys and inspections of facilities at or near the Points ofMSS Interconnection that may significantly affect the facilities of the other Party. Maintenance Schedules. NCPA shall provide the CAISO.on an annual basis with a schedule of planned maintenance, of those generation and transmission facilities identified in Schedule 1, and other transmission facilities serving a similar function or which otherwise would significantly affect the CAISO Balancing Authority Area in accordance with Schedule 4. NCPA and the CAISO shall also maintain records of the Maintenance Outages scheduled by NCPA on such facilities and their actual duration. Reliability Information. NCPA and the CAISO shall each have the obligation to inform the other Party, as promptly as possible, of any circumstance of which it becomes aware (including, but not limited to, abnormal temperatures, storms, floods, earthquakes, and equipment depletions and malfunctions and deviations from Registered Data and operating characteristics) that is reasonably likely to threaten the reliability of the CAISO Controlled Grid orthe integrity of NCPA’s System respectively. NCPA and the CAISO each shall also inform the other Party as promptly as possible of any incident of which it becomes aware (including, but not limited to, equipment outages, over-loads or alarms) which, in the case of NCPA, is reasonably likely to threaten the reliability of the CAISO Controlled Grid, or, in the case of the CAISO, is reasonably likely to adversely affect NCPA’s System. Such information shall be provided in a form and content which is reasonable in all the circumstances, sufficient to provide timely warning to the other Party of the potential threat and, in the case of the CAISO, not unduly discriminatory with respect to the CAISO’s provision of similar information to other entities. Major Outage Reports. NCPA shall promptly provide such information as the CAISO may reasonably request concerning NCPA’s operation of NCPA’s System to enable the CAISO to meet its responsibility under the CAISO Tariff to conduct reviews and prepare reports following major Outages. Where appropriate, the CAISO will provide appropriate assurances that the confidentiality of commercially sensitive information shall be protected. The CAISO shall have no responsibility to prepare reports on Outages that affect customers on NCPA’s 15 NCPA MSS AGGREGATOR AGREEMENT 6.6 6.6.1 6.6.2 6.6.3 6.7 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION System, unless the Outage also affects customers connected to the system of another entity within the CAISO Balancing Authority Area. NCPA shall be solely responsible for the preparation of any reports required by any governmental entity or the WECC with respect to any Outage that affects solely customers on NCPA’s System. CAISO shall promptlyprovide such information as NCPA may reasonably request concerning CAISO’s operation of the CAISO Balancing Authority Area to enable NCPA to meet its responsibility to conduct and prepare reports following major Outages as required by any governmental entity or the WECC. Where appropriate, NCPA will provide appropriate assurances that the confidentiality of commercially sensitive information shall be protected. Annual Reviews and Reports CAISO Annual Reviews and Reports. The CAISO shall make available to NCPA any public annual reviews or reports regarding performance standards, measurements or incentives relating to the CAISO Controlled Grid that the CAIS© makes available to MSS Operators and Participating TOs. NCPA Annual Reviews and Reports. NCPA shall make available to the CAISO any public annual reviews or reports regarding performance standards, measurements or incentives relating to NCPA’s System that may affect the CAISO Balancing Authority Area. Joint Reporting. The CAISO and NCPA shall jointly develop any necessary forms and procedures for collection, study, treatment, and transmittal of system data, information, reports and forecasts. Direct Telemetry. NCPA shall install and maintain direct telemetry links to the CAISO’s EMS system to provide real-time data to the CAISO, including but not limited to Generation output, line and transformer flows at the NCPA Points of MSS Interconnection, and bus voltages at the NCPA Points of MSS Interconnection and at each Generating Unit, subject to any exemption available in accordance with the CAISO Tariff. Additional data points to be transmitted to the CAISO EMS system will be mutually agreed by the CAISO and NCPA. ARTICLE VII EMERGENCY OPERATIONS 7.1 In General. Except with respect to Sections 7.4.1, 7.4.2, 7.5.1, and 7.5.2 and provisions regarding NCPA’s UFLS program, or unless NCPA is short of resources to meet its forecasted MSS Demand, as determined in accordance with Section 7.7.11.4 16 CALIFORNIA ISO NCPA MSS AGGR EGATOR AGREEM ENT 7.1.1 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION of the CAISO Tariff, the terms of this Article VII shall only apply during a System Emergency that is not a result of a deficiency of resources to serve Demand in the CAISO Balancing Authority Area but instead occurs due to operating contingencies, which may include but not be limited to forced loss of resources and/or transmission components or may otherwise be caused by an Uncontrollable Force, as further described in Attachment B to the NCPA EAP. NCPA shall have an "Emergency Action Plan" ("EAP") approved by the CAISO and on file with the CAISO, which EAP shall be attached to Schedule 11. The EAP shall include the operational steps NCPA on behalf of the MSSAA Members shall take during System Emergencies, when the CAISO implements its System Emergency-related Operating Procedures. Under the direction of the CAISO, NCPA or its MSS Members, as applicable, shall follow all instructions as they pertain to the CAISO’s System Emergency- related Operating Procedures, including actions to be taken by NCPA with respect to Generation, Ancillary Services, and the handling of Load reductions as specified in the EAP. NCPA shall participate in all System Emergency operations-related communication between the CAISO and other MSSs and UDCs within the CAISO Balancing Authority Area, which may include meetings, conference calls, hotlines, and/or e-mails. NCPA shall provide all necessary Load and Generation data associated with the CAISO’s System Emergency-related Operating Prbcedures, including Generation supplied, Load shed, and reserves made available during the time of a CAISO declared System Emergency. In the event a System Emergency occurs or the CAISO determines that a System Emergency is threatened or imminent, NCPA shall, in accordance with Good Utility Practice and the NCPA EAP: (a) comply with all directions from the. CAISO concerning the management and alleviation of a threatened or actual System Emergency, which may include shutting down or starting a Generating Unit, altering .the scheduled delivery of Energy or Ancillary Services to or from, as well as within, the CAISO Balancing Authority Area, and/or disconnecting MSS Members’ Load and (b) comply with all other procedures concerning System Emergencies set out in the NCPA EAP and CAISO Operating Procedures, in accordance with the applicable provisions of this Agreement. Without limiting the generality of the foregoing: Generating Unit Availability. When requested by the CAISO during a System ’Emergency, NCPA shall operate all of the Generating Units listed in Schedule 14 to supply the CAISO with generating capacity and/or Energy that can be made available by those Generating Units in order to make available as much generating capacity and/or Energy as possible to the CAISO during the term of any System Emergency, consistent with: (a) maintaining the adequate Supply of Energy to meet measured Demand of the MSS Members, other than in 17 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 7.1.1.1 7.1.1.2 7.1.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION accordance with Section 7.4 of this Agreement; and (b) due consideration for the provisions of Section 3.1 and particular obligations of NCPA identified in the EAP attached to Schedule 11 or in the limitations specified in Schedule 14, provided that NCPA shall provide the CAISO with advance notice of any changes to the NCPA EAP or limitations in Schedule 14 that NCPA’s obligations impose on the operation of the Generating Units of NCPA’s System, and any changes agreed to by the CAISO shall be amendments to this Agreement. For that purpose, NCPA shall provide the CAISO any update to the NCPA EAP and any change in Schedule 14 with regard to any limitations on the operation of the Generating Units of NCPA’s System. NCPA shall provide the CAISO updates regarding the status of the limitations in Schedule 14 promptly whenever it becomes aware of factors that affect such limitations, provided that updates shall be provided at least quarterly and no updates may be provided later than. the deadline for the submission by other Generators of changes in limitations on the operation of Generating Units, which is the deadline for the submission of Bids into the Real-Time Market, except when a change is due to a Forced Outage. In making as much generating capacity and/or Energy available that can be made available by its Generating Units to the CAISO as possible for use in System Emergency conditions, subject to the foregoing, NCPA shall: Schedule or reschedule in the form of a Bid, and operate to the maximum extent possible, the Generating Units and other sources of power of NCPA’s System within and outside the CAISO’s Balancing Authority Area to maximize the amount of generating capacity and/or Energy available that can be made available by those Generating Units and other resources to the CAISO; and Reschedule Planned Outages of equipment and facilities, including Generating Units and any facilities which may impact the operation of Generating Units, to maximize the amount of generating capacity and/or Energy available that can be made available by those Generating Units to the CAISO unless rescheduling of such Planned Outages is likely to cause damage to the equipment and facilities. CAISO Dispatch Instructions. In the event that the CAISO issues a Dispatch Instruction, including Exceptional Dispatch, that contravenes the NCPA EAP attached to Schedule 1 1 or any limitation set forth in Schedule.14 duly communicated in accordance with Section 7.1.1, NCPA or its Scheduling Coordinator shall not be required to follow that instruction, although it may consent to do so in a particular case (without prejudice to NCPA’s right to direct its Scheduling Coordinator to decline any such instructions thereafter). If NCPA or its Scheduling Coordinator chooses not to follow such an instruction, it shall notify the CAISO as soon as possible that it will not follow the Dispatch instruction due to the previously communicated limitation. 18 ~ CALIFOP,_NIA [SO NCPA MSS AGGREGATOR AGREEMENT 7.1.3 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Compensation. NCPA’s Scheduling Coordinator shall receive compensation for generating capacity and/or Energy supplied in response to Exceptional Dispatch Instructions, issued by the CAIS© in accordance with the CAISO Tariff. [Note 1: The reference to resource deficiency was removed as it is covered in Section 7.1.5 below and also separates "Dispatch Instruction" verses a "request" from the ISO .] [Note 2: The Settlement structure highlighted above reflects the current MRTU CAISO Tariff. -This, as we know, will be supplemented due to the recent ISO Board decision regarding Exceptional Dispatch. With its complexity, narrow focus and limited timeframe the ISO suggests that this section reference the CAISO Tariff. Also with the prospective discussions with Potomac Economics may not need Schedule 7.1.] [Note 3: Pending Discussion with Potomac Economics, NCPA may elect to supplement the language found is section 7.1.3 to address appropriate compensation for Energy Supplied in response to Exceptional Dispatch Instructions~] 7.1.4 Communication. During a System Emergency, the CAISO and NCPA shall communicate through their respective control centers and in accordance with procedures established in this Agreement and the CAISO Tariff. 7.1.5 System Emergency Due to Deficiencies. Notwithstanding anything to the contrary in Articles V, VII, VIII, IX, or X of this Agreement or any CAISO Tariff provision, NCPA or MSS Members shall not be expected or required to curtail their Loads or offer to the CAISO generating capacity or Energy from their Generating Units in a System Emergency that is due to the failure of other Load Serving Entities to provide resources adequate to meet measured Demand and maintain Operating Reserves in accordance with the CAISO Tariff or meet the credit requirements of Section 12 of the CAISO Tariff. 7.1.5.1 Nothing in this Section 7.1.5 or this Agreement is intended to affect NCPA or MSS Members obligation to comply with any market mitigation requirement, including any must-offer requirement, that the FERC may lawfully ~mpose upon NCPA or its MSS Members, provided, however, NCPA recognizes that the CAISO will comply with the terms of any such FERC Order regardless of issues NCPA may raise with respect to its lawfulness until such time as a final non-appealable decision is rendered. 7.2 Notice. When a System Emergency occurs, the CAISO shall notify NCPA’s control center as part of the process by which it notifies all Utility Distribution 19 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 7.3 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Companies and MSS Operators of System Emergency conditions. Details of the notification process are set forth in Schedule 7. Records. NCPA and the CAISO shall maintain all appropriate records with respect to operations during a System Emergency in accordance with the CAISO Tariff. 7.4.2 7.4.3 Load Shedding Automatic Load Shedding. NCPA, on behalf of the MSS Members, shall implement and have at all times operational an automatic Underfrequency Load Shedding (UFLS) program described in Schedule 8 and any under-voltage relay protection program that may be described in Schedule 9. Manual Load Shedding. When called upon to do so by the CAISO in accordance with Section 7.4.3 to avert, manage, or alleviate a System Emergency, NCPA, on behalf of the MSS Members, shall implement the manual Load Shedding program described in Schedule 10. The CAISO shall notify NCPA when conditions exist that would require NCPA to implement the Load curtailment and interruptible Load programs described in Schedules 10, 10A, and 10B. Subject to the provisions of Sections 7.1.2 and 7.4.3, if the CAISO determines that Load curtailment is required to manage a System Emergency, the CAISO shall determine the amount and location, if applicable, of Load to be reduced and, to the extent practicable, shall allocate a portion of the required Demand reduction to NCPA as the MSS Aggregator and each UDC and MSS Operator based on the ratio of NCPA’s MSS Demand at the time of the CAISO Balancing Authority Area annual peak Demand for the previous year to total CAISO Balancing Authority Area annual peak Demand for the previous year, taking into account system considerations and NCPA’s curtailment rights. The CAISO shall consult with NCPA, together with other Market Participants, in the CAISO’s annual development of a prioritization schedule for the Load Shedding program in accordance with Section 7.7.7 of the CAISO Tariff. Manual Load Shedding Priorities. Section 7.7.11.4 of the CAISO Tariff provides that the CAISO will determine each UDC or MSS that has insufficient resources to meet its forecasted Demand in accordance with the CAISO forecast. If Load Shedding is required solely due to insufficient resources to meet Demand and/or inability to meet Operating Reserve obligations (as defined by WECC or its successor and implemented by the CAISO), as determined in accordance with Section 7.7.11.4 of the CAISO Tariff, and only if NCPA, on behalf of the MSS Members, is short of resources to meet its forecasted MSS Demand and exports, as determined in accordance with Section 7.7.11.4 of the CAISQ Tariff, will NCPA, on behalf of the MSS Members, be required to shed Load, as directed by the CAISO. NCPA shall 20 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 7.4.4 7.4.5 7.4.6 7.5.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION provide the CAISO with detailed real time information, in graphical or tabular format for those contracts and resources that do not have direct telemetry, demonstrating its full resource sufficiency during any time that the CAISO interrupted firm Load within the CAISO Balancing Authority Area or during which time ~in CAISO direction to interrupt firm Load was in force, like other MSS Operators and UDCs seeking similar exclusion from firm Load Shedding obligations, and NCPA and its Scheduling Coordinator shall be subject to the provisions of Section 7.7.11.4 of the CAISO Tariff for any failure to make such demonstration. Load Restoration. Load shed in accordance with Section 7.4.1, 7.4.2 and 7.4.3 of this Agreement shall be restored pursuant to Schedule 12. Coordination. The CAISO shall use reasonable efforts to coordinate NCPA’s Underfrequency Load Shedding program with the Underfrequency Load Shedding programs of other MSS Operators and Utility Distribution Companies, and the implementation of all such other programs, so that no one entity bears a disproportionate share of Load Shedding in the CAISO Balancing Authority Area. NCPA warrants that its Underfrequency Load Shedding program does and will continue to fully adhere to the applicable NERC and WECC plans and requirements governing such programs, in accordance with Schedule 8. Supply Levels. To the extent NCPA, on behalf of the MSS Members, reduces NCPA’s System MSS Demand in response to a System Emergency, it shall exercise its best efforts to maintain the same level of Generation and imports as was scheduled prior to the MSS Demand reduction in order to provide the CAISO with Energy, subject to the provisions of Section 7.1.2. NCPA’s Scheduling Coordinator shall receive compensation for any Energy or Ancillary Services made available to the CAISO as a result of such Load Shedding in accordance with the CAISO Tariff and CAISO Operating Procedures. Electrical Emergency Plan Coordination of EEP and EAP. NCPA shall cooperate with the CAISO’s implementation of the Electrical Emergency Plan ("EEP") developed by the CAISO in accordance with Section 7.7.5 of the CAISO Tariff. NCPA shall implement the NCPA EAP attached to Schedule 11 of this Agreement and filed with FERC for informational purposes, and the CAISO shall cooperate with NCPA’s implementation of the EAP. Notifica{ion of Voluntary Load Curtailment. NCPA shall notify the MSS Members pursuant to NCPA’s EAP of any voluntary Load curtailments of which the CAISO notifies NCPA pursuant to the EEP. 21 ~ CAfJFORNIA I,SO NCPA MSS AGGREGATOR AGREEMENT 7.5.3 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Notification of Required Load Curtailment. When the CAISO allocates an amount of Load curtailment to NCPA pursuant to the .EEP to manage a System Emergency, NCPA shall notify the MSS Members, and the MSS Members shall effectuate the required Load reductions. 8.1 8.1.1 8.1.2 8.1.3 8.2 ARTICLE VIII LOCAL AND REGIONAL RELIABILITY Reliability Within NCPA’s System NCPA System Reliability. NCPA or the MSSAA Members, as applicable, shall be solely responsible for maintaining the reliability of electric service to customers in NCPA’s System in accordance with Applicable Reliability Criteria, WECC and NERC Reliability Standards and requirements as specified in Section 3.2.2, regulatory requirements, and Good Utility Practice, subject to the responsibilities of the CAISO as the Balancing Authority for the Balancing Authority Area in which NCPA’s System is located. Reliability Generation. NCPA shall be responsible for any reliability Generation, Voltage Support, and Black Start service requirements within NCPA’s System. At the Points of MSS Interconnection,.Voltage Support shall be managed in accordance with the PG&E IA and the CAISO Tariff. Reliability Support Cost. If and to the extent the NERC or WECC criteria change or NCPA does not maintain sufficient Generation to meet the reliability criteria in Schedule 16, as may be amended, as applied to NCPA’s System and thus avoid adverse impacts on the CAISO Controlled Grid, then NCPA’s Scheduling Coordinator may be assessed costs incurred by the CAISO to support the reliability of NCPA’s System. The CAISO will notify NCPA that the reliability criteria have not been met and the Parties shall negotiate in good faith over necessary modifications and, if they cannot reach agreement, submit the dispute to dispute resolution in accordance with Article XIV of this Agreement. Balancing Authority Area Reliability. For the costs specified in this Article VIII, NCPA, through its Scheduling Coordinator, shall be responsible for supplying or bearing its proportionate share of the costs of generating resources required for the reliability of electric service to Loads in the. CAISO Balancing Authority Area, except for Reliability Must-Run ("RMR") Generation costs on the CAISO Controlled Grid, where such costs are the responsibility of the Participating TO where the RMR unit is interconnected, provided further that NCPA or the MSSAA Members are not a Participating TO. NCPA, through its Scheduling Coordinator, may meet such obligation from resources it owns or with respect to which it has contractual entitlements to the Energy and Ancillary Services or it may purchase 22 1~ CALIFOP~NIA ISO NCPA MSS AGGREGATOR AGREEM ENT 8.2.1 8.2.2 8.3 8.4 8.5 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION those products through the CAISO’s Markets in accordance with the terms of the CAISO Tariff. NCPA System Reliability Generation. NCPA’s reliability Generation is’ currently identified in Schedule 14. In addition, some of NCPA’s Generation may provide RMR Generation services to PG&E and in that instance will be subject to the terms of the CAISO Tariff applicable to Reliability Must-Run Generation. Reliability Must-Run Availability. Should NCPA elect to Load follow in accordance with Section 4.9.13 of the CAISO Tariff, nothing in this Agreement shall obligate NCPA or the NCPA Members to make any Generating Units available as Reliability Must-Run Generation other than those identified in Schedule 14 as RMR Units, unless NCPA orthe MSS Members notifies the CAISO that it desires to participate in the RMR Unit designation process. To the extent NCPA does not notify the CAISO that it desires to participate in the RMR Unit designation process, the CAISO agrees that, in circumstances affecting local reliability of the CAISO Controlled Grid that would otherwise be mitigated by RMR Units, any Generation not being used to serve MSS Members will be made available to the CAISO, subject to Article VII of this Agreement. Voltage Support. Except as otherwise agreed by the Parties, unless Pacific Gas and Electric Company directs NCPA to maintain a specific voltage at any Point of Interconnection at a NCPA or MSSAA Member generating unit, NCPA shall maintain the voltage on NCPA’s System so that reactive flows at the Points of MSS Interconnection are within the power factor band of 0.97 lag to 0:99 lead. NCPA shall not be compensated for maintaining the power factor at the levels required by Section 8.3 within this bandwidth. If NCPA fails to maintain the power factor at the levels specified by Section 8.3, NCPA’s Scheduling Coordinator shall bear a portion of the CAISO’s Voltage Support costs. Black Start. NCPA shall either provide its own share of CAISO Balancing Authority Area Black Start capability or, to the extent NCPA does not provide its own Black Start capability through its Scheduling Coordinator, NCPA’s Scheduling Coordinator shall bear a portion of the CAISO’s Black Start costs in accordance with CAISO Tariff Section 4.9.4.5. Ancillary Services. The CAIS© is entrusted with the responsibility of procuring Ancillary Services for the Balancing Authority Area. NCPA’s responsibility for the CAISO Balancing Authority Area requirements of Ancillary Services shall be determined in accordance with the CAISO Tariff. If NCPA’s Scheduling Coordinator’s Submission to Self-Provide an Ancillary Service is sufficient to meet NCPA’s Ancillary Service Obligation, which capacity is committed to the various required Ancillary Services, and maintains the Ancillary Service capacity 23 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION as available to the CAISO for that purpose, NCPA’s Scheduling Coordinator shall not be required to purchase capacity in the CAISO’s Ancillary Service markets. To the extent NCPA’s Scheduling Coordinator does not self:provide sufficient capacity for this purpose, NCPA may, through its Scheduling Coordinator, purchase the required capacity in the CAISO’s Ancillary Service markets. To the extent NCPA’s Scheduling Coordinator does not maintain the availability of capacity committed to the CAISO for Ancillary Services for that purpose, the Scheduling Coordinator shall be responsible for the applicable charges under the CAISO Tariff. 9.1 9.1.1 9.1.2 9.1.3 9.1.4 ARTICLE IX ACCESS & SCHEDULING Existing Contracts and Encumbrances and Access to the CAISO Controlled Grid Settlement Agreement. This Agreement is intended to operate in conjunction with the Settlement Agreement. Nothing in this Agreement shall be construed or interpreted in any manner that would interfere with the terms and conditions of any Existing Contract or Encumbrance or relieve the CAISO of its obligation to honor such Existing Contracts and Encumbrances, provided that NCPA or its Scheduling Coordinator shall schedule its use of Existing Contracts and Encumbrances as specified in Section 9.2.3 of this Agreement. The Existing Contracts and Encumbrances are listed on Schedule 13. Open Access to CAISO Controlled Grid. NCPA and the MSS Members shall have open and non-discriminatory access to the CAISO Controlled Grid for the scheduling of transactions that do not utilize Existing Contracts and Encumbrances for it or the MSS Members in accordance with the CAISO Tariff and for other transmission services the CAISO may provide in the future under the CAISO Tariff. Use of CAISO Controlled Grid, NCPA and the MSS Members may use the CAISO Controlled Grid in accordance with the CAISO Tariff to buy and sell electric products in the CAISO’s markets and in bilateral transactions with other Market Participants. Open Access to NCPA System. NCPA and the MSS Members shall afford open and non-discriminatory access to the transmission facilities included in NCPA’s System to any entity qualified to obtain an order under Section 211 of the Federal Power Act that affords such access to the transmission facilities that such entity owns or controls. 24 ~ CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 9.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Access to CAISO Markets 9.2.1 9.2.2 9.2.3 Energy, Ancillary Services and RUC Capacity. Energy, Ancillary Services and RUC Capacity provided by Generating Units and Loads on NCPA’s System may be sold in the CAISO’s markets on the terms applicable under the CAISO Tariff to’Participating Generators and Participating Loads, respectively, as modified by this Agreement. If NCPA’s Scheduling Coordinator Bids to provide Energy or Ancillary Services from a Generating Unit or Load of NCPA’s System, NCPA warrants to the CAISO that it has the capability to provide that service in accordance with the CAISO Tariff and that it shall comply with CAISO Dispatch Instructions for the provision of service in accordance with this Agreement. NCPA may self-provide all or any portion of its obligation for Energy and Ancillary Services in accordance with the CAISO Tariff. Participation in the Integrated Forward Market. Should NCPA elect to Load follow in accordance with Section 4.9.13 of the CAISO Tariff, NCPA’s Scheduling Coordinator must also submit Bids, including but not limited to Self- Schedules, of Supply in the Day-Ahead Market to match its Demand Forecast as developed by NCPA. Sources of Supply may include generation, imports, Existing Transmission Contract deliveries, and trades. Scheduling Timelines. All Bids submitted on behalf of the MSS Members for delivery of Energy, Ancillary Services, and RUC Capacity to Loads in NCPA’s System and for exports from NCPA’s System shall be submitted by a Scheduling Coordinator certified in accordance with the applicable provisions of the CAISO Tariff that has entered into a Scheduling Coordinator Agreement with the CAISO that is currently in effect. The Scheduling Coordinator.may be NCPA itself or a Scheduling Coordinator designated by NCPA. Except as otherwise specified in this Section 9.2, NCPA’s Scheduling Coordinator shall submit all Bids, including (i) Self-Schedules for the use of its Existing Contracts and Encumbrances, and Transmission Ownership Rights comprising NCPA’s System, (ii) Bids and Self-Schedules for the use of the CAISO Controlled Grid as a new firm use, and (iii) Bids, including but not limited to Self-Schedules, for the delivery of Energy and Ancillary Services, within the timelines established by the CAISO Tariff. NCPA’s Scheduling Coordinator shall not be precluded from making real-time changes if such scheduling capability is afforded NCPA or MSS Members under Existing Contracts, Encumbrances, or the Settlement Agreement pursuant to Schedule 13 of this Agreement. Schedule 13 includes any scheduling timelines required for Existing Contracts and Encumbrances, and Transmission Ownership Rights comprising NCPA’s System. If NCPA elects to perform Load following as an MSS Aggregator in accordance with Section 4.9.13 of the CAISO Tariff, NCPA’s Scheduling Coordinator shall have the ability to deviate from its real-time scheduled amounts in order to follow load as described in Section 12.12, and not be restricted by the scheduling timelines established by the CAISO Tariff. 25 ~ CAL]’FORNIA [SO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 9.2.4 9.3 Black Start and Voltage Support. NCPA or its Scheduling Coordinator shall be entitled to Bid the resources on NCPA’s System in any open solicitation held by the CAISO for Black Start or Voltage Support services, provided that the supply of any service by NCPA shall not impair its ability to provide the service it is required by Article VIII of this Agreement to provide for NCPA’s System, and, if the services are sold to the CAISO, NCPA or its Scheduling Coordinator shall, provide such services in accordance with the CAISO Tariff. Congestion Revenue Rights. The MSSAA Members as Load Serving Entities are eligible to participate in and receive an allocation of CRR through the CRR Allocation process in accordance with Section 36 of the CAISO Tariff. NCPA, in order to represent the MSSAA Members in the CRR Allocation process, must execute a pro forma MSS Aggregator CRR Entity Agent Agreement in accordance with the CAISO Tariff. Once executed, NCPA will be authorized to act on behalf of the MSSAA Members, acting as the CRR Entity Agent, with regard to CRR matters, including, but not limited to, allowing NCPA to participate in the CRR nomination process, to accept financial responsibility under the agreement, to perform settlement functions, and to comply with other CAISO Tariff requirements. 10.1 10.1.1 10.1.2 ARTICLE X GENERATING UNITS AND PARTICIPATING LOADS Identification of Resources. NCPA has identified in Schedule 14 the individual Generating Units and Participating Loads that NCPA and the MSS Members own, operate, or to which they have a contractual entitlement. Technical Characteristics. NCPA has provided to the CAISO in Schedule 14 the required information regarding the capacity and operating characteristics of each of the Generating Units and Participating Loads listed in that schedule. The CAISO may verify, inspect, and test the capacity and operating characteristics provided in Schedule 14, and any changes thereto made pursuant to Section 10.1.2 of this Agreement, in accordance with Section 8.10 of the CAISO Tariff. Notification of Changes. NCPA shall notify the CAISO sixty (60) days prior to any change to the information provided in Schedule 14, provided that such notice shall not be required for changes to parameters of operating limitations set forth in Schedule 14, which shall be made in accordance with the CAISO’s Operating Procedures. The Parties shall amend Schedule 14, as applicable, to reflect that change. Subject to such notification, and verification, inspection, and testing in accordance with Section 10.1.1, but without waiting for the execution and effectiveness of an amended Schedule 14, the Parties shall 26 ~ CALII=OR~IL~ ISO NCPA MSS AGGREGATOR AGREEMENT 10.1.3 10.2.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION implement any new information for a Generating Unit or Participating Load identified in Schedule 14 upon the effective date for the next scheduled update to the CAISO’s Master File. Generating Unit Limitations. Nothing in this section shall preclude NCPA from informing the CAIS© of changes in limitations on the operation of a Generating Unit, as provided in Section 7.1 of this Agreement, or to comply with environmental laws and regulations, provided that NCPA provides the CAISO with advance notice of any changes in such limitations. Generating Unit Operation Generating Unit Telemetry. NCPA shall install and maintain direct telemetry links to the CAIS©’s EMS system for each NCPA Generating Unit that enable the CAIS© to view the status, voltage, and output of the Generating Unit and CAISO certified meters that transmit data automatically to the CAISO’s Revenue Meter Data Acquisition and Processing System. NCPA shall calculate and specify to the CAISO any distribution loss factor applicable to the Generating Units of NCPA’s System. Regulation Ancillary Service. If NCPA, through its Scheduling Coordinator, chooses to submit Bids to supply Regulation or to Self-Provide Regulation from a Generating Unit, it must provide the CAISO with control over the Generating Unit providing Regulation and place the Generating Unit on Automatic Generation Control ("AGC") responsive to the CAISO’s Regulation signal. Regulation service shall be provided in accordance with the CAISO Tariff. NCPA or its Scheduling Coordinator may adjust output of the Generating Units of NCPA’s System, in response to NCPA’s Load following needs, provided that, if NCPA is providing Regulation to the CAISO from any Generating Unit, it may not adjust the output of that Generating Unit unless the integrity of the CAISO’s Regulation signal, and the continuous responsiveness of such Generating Unit, via AGC, to the CAISO’s Regulation signal, is not compromised. If the CAISO determines that the integrity of.the CAISO’s Regulation signal or the continuous responsiveness to the CAISO’s Regulation signal is compromised, NCPA’s Generating Unit shall be deemed not to have provided the Regulation, and NCPA shall be subject to the provisions of the CAISO Tariff applicable to failure to provide Regulation. To the extent that NCPA chooses not to provide Regulation from an NCPA Generating Unit, the CAISO shall not control the Generating Unit via a direct link between the CAISO and the Generating Unit without NCPA’s consent. 10.3 CAISO Authority to Dispatch NCPA Resources. The CAISO’s authority to issue Dispatch Instructions, including Exceptional Dispatch, for any portion of the capacity of any Generating Unit of NCPA or the MSS Members, other than in 27 NCPA MSS AGG£EGATOR AGREEMENT 10.4 10.4.1 10.4.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION accordance with a Bid submitted to the CAISO by NCPA’s Scheduling Coordinator, is set forth in and subject to Section 7.1 of this Agreement. WECC Requirements Applicable to Participating Generators Reliability Criteria. NCPA and the MSS Members shall comply with the requirements of Section 4.6.5 of the CAISO Tariff applicable to Participating Generators, and in accordance with Section 3.2.2. Payment of WECC Sanctions. NCPA and the MSS Members shall be responsible for payment directly to the WECC of any monetary sanction assessed against NCPA or the MSS Members by the WECC, as provided in Section 4.6.5.3 of the CAISO Tariff. 11.1 11.2 11.3 ARTICLE XI METERING CAISO Certified Revenue Quality Metering. NCPA shall ensure installation of CAISO-certified revenue quality meters and associated equipment at (a) the Points of MSS Interconnection and, (b) for each Generating Unit listed in Schedule 14, at each bus to which one or more Generating Units is connected, provided that the Demand of any Load at that bus, other than a Generating Unit auxiliary Load, is separately metered. Metering Requirements. The provisions of the CAISO Tariff applicable to CAISO Metered Entities shall apply to NCPA, subject to the particular rights and obligations of the Parties with respect to metering set forth in Schedule 15, including access to and testing of NCPA’s meters. NCPA SQMD Calculation. The calculation of NCPA’s Settlement Quality Meter Data shall be in accordance with Schedule 15. 12.1 ARTICLE Xll CHARGES Charges Generally. Except as may be provided otherwise in the provisions contained within Article XII or other sections of this Agreement, NCPA’s Scheduling Coordinator shall be responsible for charges incurred in accordance with Sections 4.9 and 11 of the CAISO Tariff, provided that nothing in this Agreement shall prohibit NCPA from challenging the allocation of any new charge under the CAISO Tariff to NCPA on the ground that the proposed charge is not appropriately assessed against a MSS Aggregator and MSS Operator, or 28 ~ CAL~laOI:I.NI~. IS O NCPA MSS AGGREGATOR AGREEMENT 12.2 12.3 12.4 12.5 12.6 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION on any other ground. Further, except as specifically provided in this Agreement, NCPA shall only be responsible for charges allocated by the CAISO Tariff to Participating TOs if it becomes a Participating TO, aspermitted by Section 3.3.7. Congestion Management. NCPA shall be responsible for the cost of managing and relieving Congestion within any of the MSS Member’s Service Area, as specified in Section 5.5, only to the extent that the cause of Congestion is attributed to MSS Member operations. If the cause of Congestion is not directly attributed to MSS Member operations, and the CAISO utilizes Exceptional Dispatch Instructions to resolve the identified Congestion, the resulting costs shall be allocated pursuant to the provisions specified in Section 11.5.6.2.5.2 of the CAISO Tariff, and will not be solely allocated to the MSS Members. Unaccounted-For Energy Costs. NCPA’s System shall be treated as a Utility Distribution Company Service Area for purposes of allocating responsibility for Ur~accounted For Energy costs in accordance with the CAISO Tariff. Reliability Generation. NCPA shall be responsible for the costs of maintaining the reliability of transmission facilities in NCPA’s System, including costs of Generating Units operated by or on behalf of NCPA for that purpose. If and to the extent NCPA does not maintain sufficient Generation to meet the reliability criteria in Schedule 16 as applied to NCPA’s System.and thus avoid material adverse impacts on the CAISO Controlled Grid, then NCPA may be assessed costs incurred by the CAISO to support the reliability of NCPA’s System. Neutrality Costs. NCPA’s Scheduling Coordinator’s obligation to pay neutrality adjustments and Existing Contracts cash neutrality charges (or collect refunds) shall be based on NCPA’s net metered MSS Demand and exports from the CAISO Balancing Authority Area irrespective of the NCPA’s MSS settlement election as specified in Section 4.9.13 of the CAISO Tariff. CAISO Balancing Authority Area Summer Reliability Costs. NCPA, through its Scheduling Coordinator, shall have the option to avoid any share of the CAISO’s costs for any summer Demand reduction program or for any summer reliability Generation procurement program pursuant to CAISO Tariff Section. 42.1.8. In order to avoid such costs, NCPA shall secure capacity on an annual basis at least equal to one hundred fifteen percent (115%) of the peak MSS Demand responsibility of MSS Members, and provide documentation to the CAISO of the resources proposed to meet that MSS peak Demand. Such capacity reserves may include on-demand rights to Energy, peaking resources, and MSS Members’ Demand reduction programs. For the purposes of this Section 12.6, the MSS peak Demand responsibility shall be equal to the forecasted annual coincident MSS peak Demand Forecast plus any firm power sales by MSS Members plus any MSS Members’ on-demand obligations to third parties, less interruptible Loads, and less any firm power purchases. Firm power 29 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 12.7 12.7.1 12.7.2 12.8 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION for the purposes of this Section 12.6 shall be Energy that is intended to be available to the purchaser without being subject to interruption or curtailment by the supplier except for Uncontrollable Forces or emergency, and for which the supplier carries WECC-required operating reserves. To the extent that NCPA demonstrates its provision of capacity reserves in accordance with this Section 12.6, MSS members’ Scheduling Coordinator shall not be obligated to bear any share of the CAISO’s costs for any summer Demand reduction program or for any summer reliability Generation procurement program pursuant to CAISO Tariff Section 42.1.8. SVP must demonstrate its provision of the resources proposed to meet that peak Demand responsibility plus capacity reserves separately. Generating Unit Minimum Load and Start-Up Costs. If the CAISO is compensating Generating Units for Minimum Load Costs and Start-Up Costs, and NCPA has elected to follow its Load in accordance with Section 4.9.13 of the CAISO Tariff, then NCPA’s Scheduling Coordinator shall elect either the option set forth in Section 12.7.1 or the option set forth in Section 12.7.2. Regardless of this election, NCPA’s Scheduling Coordinator shall be eligible for recovery of Minimum Load Costs and charge the CAISO for Start-Up Costs of the Generating Units providing Energy to the CAISO which is not used to serve the Load of NCPA’s System. NCPA shall make the election specified in Section 12.7 annually by November 1 for the following calendar year. Election to Receive Minimum Load and Start-Up Compensation. NCPA may elect to be eligible for recovery of Minimum Load Costs and charge the CAISO for the Start-Up Costs of the Generating Units serving the Load of NCPA’s System. If NCPA makes such election, then the Scheduling ¯ Coordinator for NCPA as MSS Aggregator shall bear its proportionate share of the total amount of those costs incurred by the CAISO, whether billed as separate charges or billed within an aggregate charge (such as IFM or RTM Bid Cost Recovery Uplift), in accordance with Section 12.8 and 12.9. Election Not to Receive Minimum Load and Start-Up Compensation. NCPA may elect not to be eligible for recovery of Minimum Load Costs and not to charge the CAISO for the Start-Up Costs of the Generating Units serving the Load of NCPA’s System. If NCPA makes such election, then the Scheduling Coordinator for NCPA as MSS Aggregator shall bear its proportionate share of the total amount of those costs incurred by the CAISO, whether billed as separate charges or billed within an aggregate charge (such as IFM or RTM Bid Cost Recovery Uplift), in accordance with Section 12.8 and 12.9. Allocation of Net IFM Bid Cost Recovery Uplift. NCPA’s Scheduling Coordinator’s obligation to pay Net IFM Bid Cost Uplift charges shall be based on the following two tier structure: 3O ~ CALI~OI&N[A ISO NCPA MSS AGGREGATORAGREEMENT 12.8.1 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Tier 1 IFM Bid Cost Recovery Uplift. The hourly Net IFM Bid Cost Uplift is allocated to NCPA’s Scheduling Coordinator in proportion to NCPA’s non- negative IFM Load Upliff Obligation, but with an IFM Bid Cost Uplift rate not exceeding the ratio of the hourly Net IFM Bid Cost Upliff for the Trading Hour divided by the sum of all hourly Generation scheduled in the Day-Ahead Schedule and IFM upward AS Awards for all Scheduling Coordinators from CAISO-committed Bid Cost Recovery Eligible Resources in that Trading Hour. The IFM Load Uplift Obligation for NCPA’s Scheduling Coordinator is the difference between the total MSS Demand scheduled in the Day-Ahead Schedule and the scheduled Generation from the Self-Schedules in the Day- Ahead Schedule, plus imports scheduled in its Day-Ahead Schedule, adjusted by any applicable Inter-SC Trades of IFM Load Uplift Obligations. 12.8.2 Tier 2 IFM Bid Cost Recovery Uplift. The scheduling Coordinators for MSS Operators that have elected both to not follow their Load and gross Settlement will be charged for an amount equal to any remaining hourly Net IFM Bid Cost Upliff for the Trading Hour in proportion to the MSS Operator’s gross Measured Demand. Scheduling Coordinators for MSS Operators that have elected both to not follow their Load and net Settlement, will be charged for an amount equal to any remaining hourly Net IFM Bid Cost Upliff for the Trading Hour in proportion to the MSS Operator’s Net Measured Demand. The Scheduling Coordinators for MSS Operators that have elected to follow their Load, in accordance with Section 4.9.13 of the CAISO Tariff, and that have elected pursuant to Section 12.7.1 to be eligible for recovery of Minimum Load Costs and charge CAISO for the Start-Up Costs of the Generating Units serving its Load, will be charged for an amount equal to any remaining hourly Net IFM Bid Cost Upliff for the Trading Hour in proportion to the MSS Operator’s Net Measured Demand. The Scheduling Coordinators for MSS Operators that have elected to follow their Load, in accordance with Section 4.9.13 of the CAISO Tariff, and that have elected pursuant to Section 12.7.2 not to be eligible for recovery of Minimum Load Costs and not to charge the CAISO for the Start-Up Costs of the Generating Units serving its Load, are exempt from tier 2 IFM Bid Cost Recovery Uplift cost allocation. 12.9 Allocation of Net RTM Bid Cost Recovery Uplift. The allocation of Net RTM Bid Cost Recovery Uplift is based on the MSS Settlement elections as specified in Section 4.9.13 of the CAISO Tariff. The hourly RTM Bid Cost Uplift is allocated to Scheduling Coordinators for MSS Operators that have elected to not follow their Load and gross Settlement, in proportion to their gross Measured Demand for the Trading Hour. Scheduling Coordinators for MSS Operators that have elected to not follow their Load and net Settlement, will be allocated hourly RTM Bid Cost Uplift in proportion to their MSS Aggregation Net Measured Demand. Scheduling Coordinators for MSS Operators that elect to follow their Load, and that have elected pursuant to Section 12.7.1 to be eligible for recovery of Minimum Load Costs and charge CAISO for the Start-Up Costs of the 31 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 12.10 12.11 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Generating Units serving its Load, will be allocated hourly RTM Bid Cost Uplift in proportion to their MSS Aggregation Net Measured Demand. Scheduling Coordinators for MSS Operators that have elected to follow their Load, and that have elected pursuant to Section 12.7.2 not to be eligible for recovery of Minimum Load Costs and not to charge the CAISO for the Start-Up Costs of the Generating Units serving its Load, will be allocated hourly RTM Bid Cost Uplift in proportion to their MSS portfolio Net Negative Uninstructed Deviation with Load- following Energy included in the netting. Grid Management Charges Based on Uninstructed Imbalance Energy. If the CAISO is charging Grid Management Charges for Uninstructed Imbalance Energy, and should NCPA elect on behalf of the MSS Members, in accordance with Section 4.9.13 of the CAISO Tariff to perform Load-following, NCPA’s Scheduling Coordinator should only be assessed Grid Management Charges for Uninstructed Imbalance Energy based on the net quantity of Energy either delivered to or received from the CAISO Real-Time Market, excluding the quantity of Energy provided as Instructed Imbalance Energy, other than MSS Load Following Energy, and the quantity of Energy used to perform Load- following. If the amount of Ene[gy provided from Generation resources listed in Schedule 14, imports and trades in to the MSS Aggregation netted against MSS Demand; exports, and trades out of the MSS Aggregation is positive, excluding Instructed Imbalance Energy other than MSS Load Following Energy, then such portion of Energy was provided in excess of NCPA’s Load-following needs and was sold into the CAISO Real-Time Market, in which case NCPA’s Scheduling Coordinator will only be charged Grid Management Charges associated with Uninstructed Imbalance Energy for this net excess quantity. If the amount of Energy provided from Generation resources listed in Schedule 14, imports and trades into the MSS Aggregation. netted against MSS Demand, exports, and trades out of the MSS Aggregation is negative, excluding Instructed Imbalance Energy other than MSS Load Following Energy, then such portion of Energy was not sufficient to fully cover NCPA’s Load-following needs and was purchased from the CAISO Real-Time Market, in which case NCPA’s Scheduling Coordinator will only be charged Grid Management Charges associated with Uninstructed Imbalance Energy for this net purchased quantity. For the purposes of calculating the quantity of Uninstructed Imbalance Energy not used to perform Load following, MSS Load Following Energy, which is classified as Instructed Imbalance Energy, will be included in the calculation of Uninstructed Imbalance Energy by netting MSS Load Following Energy against Uninstructed Imbalance Energy. Grid Management Charges Based on Instructed Imbalance Energy. If the CAISO is charging Grid Management Charges for Instructed Imbalance Energy, NCPA’s Scheduling Coordinator will not be assessed Grid Management Charges for Instructed Imbalance Energy associated with MSS Load Following Energy. 32 CALIFORNIA IS©NCPA MSS AGGREGATOR AGREEMENT 12.12 12.13 12.14 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION MSS Deviation Band. The amount by which a Load following MSS Operator can deviate from Expected Energy without incurring a Load Following Deviation Band Penalty, as defined in Section 12.13, which is equal to three percent (3%) of an MSS Operator’s metered MSS Demand and exports from the MSS, adjusted for Forced Outages and any CAIS© directed firm Load Shedding from the MSS’s portfolio as a whole. Load Following Deviation Band Compliance. To the extent that sufficient Energy for the purposes of serving MSS Demand in the Service Areas of MSS Members for which NCPA serves as MSS Aggregator and or Scheduling Coordinator and exports from the Service Areas of those MSS Members, including losses, is not reflected in Schedules, submitted in the form of a Bid, by NCPA’s Scheduling Coordinator and delivered in real time, NCPA shall be deemed (through its Scheduling Coordinator) to have purchased or sold Imbalance Energy in the CAIS©’s Real-Time Market. The CAISO will settle with NCPA’s Scheduling Coordinator with regard to Imbalance Energy in accordance with the CAISO Tariff. However, should NCPA elect, on behalf of the MSS Members, in accordance with Section 4.9.13 of the CAISO Tariff to follow NCPA MSS Demand and exports from the MSS Aggregation with NCPA’s System resources and imports into the MSS Aggregation, to the extent that the net Imbalance Energy for all of NCPA’s MSS Demand and exports from the MSS Aggregation, and resources and imports into the MSS Aggregation, is within NCPA’s portfolio MSS Deviation Band, as specified in Section 12.11, NCPA’s Scheduling Coordinator will not be subject to the Load Following Deviation Penalty, as specified in Section 12.13, or costs other than the cost of the Imbalance Energy itself. Schedule 19 of this Agreement describes the process for calculating the applicable amount of net Imbalance Energy, which is referred to as deviation energy within Schedule 19. To the extent that NCPA’s Scheduling Coordinator is operating outside of its portfolio MSS Deviation Band, NCPA’s Scheduling Coordinator shall be subject to the Load Following Deviation Penalty. In following Load, NCPA’s Scheduling Coordinator may utilize any resource available to it regardless of whether, or at what level, the resource is reflected in Schedules submitted by NCPA’s Scheduling Coordinator, submitted in the form of a Bid or Self-Schedule, except with respect to any portion of the capacity of a resource for which NCPA’s Scheduling Coordinator has scheduled to provide an Ancillary Service and or RUC Capacity to the CAIS© for that resource or to theextent the CAIS© has issued a System Emergency operating order consistent with Section 7.1.1. Deviation Band Penalties Calculation. For purposes of assessing deviation band penalties to NCPA’s scheduling coordinator, the CAIS© will evaluate the amount of (i) positive deviation energy outside of the portfolio MSS Deviation Band supplied to the CAISO Markets or (ii) negative deviation energy outside of the portfolio MSS Deviation Band supplied from the CAISO Markets not served by NCPA resources. To the extent that NCPA’s Scheduling Coordinator has 33 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION provided positive deviation energy outside of the portfolio MSS Deviation Band supplied to the CAISO Markets, then the payment for excess Energy outside of the portfolio MSS Deviation Band shall be rescinded and thus NCPA’s Scheduling Coordinator will pay the CAISO an amount equal to one hundred percent (100%) of the product of the highest LMP paid to the MSS Operator for its Generation in the Settlement Interval for the amount of the Imbalance Energy that is supplied in excess of the portfolio MSS Deviation Band. To the extent that NCPA’s Scheduling Coordinator has a negative amount of deviation energy outside of the portfolio MSS Deviation Band supplied from the CAISO Markets that is not served by NCPA resources, then NCPA’s Scheduling Coordinator shall pay the CAISO an amount equal to the product of the Default LAP price for the Settlement Interval and two hundred percent (200%) of the shortfall that is outside of the portfolio MSS Deviation Band. The two hundred percent (200%) penalty is in addition to the charges for the Imbalance Energy that is supplied from the CAISO Markets. 12.15 Operating and Maintenance Costs. NCPA shall be responsible for all its costs incurred in connection with procuring, installing, operating, and maintaining the facilities, Generating Units, and Participating Loads of NCPA’s System for the purpose of meeting its obligations under this Agreement. 12.16 Billing and Payment. Billing and payment will be in accordance with the CAISO Tariff. 12.17 MSS Net Negative Uninstructed Deviation. The calculation of MSS Net Negative Uninstructed Deviation must include MSS Load Following Energy as part of the calculation of Net Negative Uninstructed Deviation quantities when used for purposes of applicable CAISO settlement allocation.. MSS Load Following Energy shall be netted against Uninstructed Imbalance Energy to properly account for the actual quantity of Net Negative Uninstructed Deviation. 12.18 Residual Unit Commitment. Should NCPA elect, on behalf of the MSS Members, in accordance with Section 4.9.13 of the CAISO Tariff to perform Load-following, NCPA will be considered to have automatically opt-out of RUC participation and NCPA’s Scheduling Coordinator will be exempt from costs associated with RUC and Bid Cost Recovery for RUC. 12.19 Emissions Costs. Unless specified otherwise in this Agreement, if the CAISO is compensating Generating Units for Emissions Costs, and if NCPA as MSS Aggregator elects to charge the CAISO for the Emissions Costs of the Generating Units serving Load of NCPA’s System, then NCPA’s Scheduling Coordinator shall bear its proportionate share of the total amount of those costs incurred by the CAISO based on NCPA as MSS Aggregator’s gross Measured Demand excluding out of state exports. If NCPA as M$S Aggregator elects not to charge the CAISO for the Emissions Costs of the Generating Units serving 34 NCPA MSS AGGREGATOR AGREEMENT 13.1 13.2 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Load of NCPA’s System, then NCPA’s Scheduling Coordinator shall bear its proportionate share of the total amount of those costs incurred by the CAISO based on NCPA as MSS Aggregator’s net Measured Demand excluding out-of- state exports. If NCPA as MSS Aggregator elects to following its load, in accordance with Section 4.9.13 of the CAISO Tariff, and if NCPA as MSS Aggregator elects not to charge the CAISO for Emissions Costs of the Generating Units serving the Load of NCPA’s System, then NCPA’s Scheduling Coordinator shall bear its proportionate share of the total amount of those costs incurred by the CAISQ based on NCPA as MSS Aggregator’s Net Negative Uninstructed Deviations with Load Following Energy included in the netting. NCPA as MSS Aggregator shall make the election of whether to charge the CAISO for these costs on an annual basis on November 1 for the following calendar year. ARTICLE Xlll PENALTIES AND SANCTIONS Penalties. NCPA or its Scheduling Coordinator shall be subject to penalties and/or sanctions for failure to comply with any provisions of this Agreement only to the extent that (a) the penalty or sanction is set forth in the CAISO Tariff and has been approved by FERC; and (b) the CAISO Tariff provides for the imposition of the same penalty or sanction on a UDC, MSS Aggregator, MSS Operator, Participating Generator, or Participating Load in the same circumstances. Nothing in this Agreement, with the exception of the provisions of Article XIV, shall be construed as waiving the rights of NCPA to oppose or protest any penalty or sanction proposed by the CAISO to the FERC or the specific imposition by the CAISO of any FERC-approved penalty or sanction on NCPA. Corrective Measures. If NCPA or its MSSAA Members fail to meet or maintain the requirements set forth in this Agreement or in the applicable provisions of the CAISO Tariff, the CAISO shall be permitted to take any of the measures, contained or referenced herein or in the applicable provisions of the CAISO Tariff that the CAISO deems to be necessary to correct the situation. 14.1 ARTICLE XlV DISPUTE RESOLUTION Dispute Resolution. NCPA and the CAISO shall make reasonable efforts to settle all disputes arising out of or in connection with this Agreement. In the event any dispute is not settled, NCPA and the CAISO shall adhere to the CAISO ADR Procedures set forth in Section 13 of the CAISO Tariff, which is incorporated by reference, except that any reference in Section 13 of the CAISO 35 CA~.I[=O~,NIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Tariff to Market Participants shall be read as a reference to NCPA and references to the CAISO Tariff shall be read as references to this Agreemen.t. ARTICLE XV REPRESENTATIONS AND WARRANTIES 15.1 15.2 15.3 Representations and Warranties. Each Party represents and warrants that the execution, delivery and performance of this Agreement by it has been duly authorized by all necessary corporate and/or governmental actions, to the extent authorized by law. Necessary Approvals. Each Party represents that all necessary leases, approvals, licenses, permits, easements, rights of way or access to install, own and/or operate its facilities subject to this Agreement have been or will be obtained prior to the effective date of this Agreement. NCPA Representation of MSS Members. NCPA represents and warrants that, as of the effective date of this Agreement as set forth in Section 2.1, it is authorized by all applicable MSS Members to perform the duties and obligations set forth in this Agreement. 16.1 ARTICLE XVl LIABILITY AND INDEMNIFICATION Liability and Indemnification. The provisions of Section 14 of the CAISO Tariff will apply to liability and indemnification arising under this Agreement, except that all references in Section 14 of the CAISO Tariff to Market Participants shall be read as references to NCPA and references to the CAIS© Tariff shall be read as references to this Agreement. 17.1 ARTICLE XVll UNCONTROLLABLE FORCES Uncontrollable Forces. Section 14.1 of the CAISO Tariff shall be incorporated by reference into this Agreement, except that all references in Section 14.1 of the CAIS© Tariff to Market Participants shall be read as a reference to NCPA and references to the CAISO Tariff shall be read as references to this Agreement. ARTICLE XVlII MISCELLANEOUS 36 ~ CA~OaN~A ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 18.1 18.2 18.3 18.4 18.5 18.6 Notices. Any notice, demand or request which may be given to or made upon either Party regarding this Agreement shall be made in writing to the employee or official identified in Schedule 17 of this Agreement, and shall be deemed properly given: (a) upon delivery, if delivered in person, (b) five (5) days after deposit in the mail if sent by first class United States mail, postage prepaid, (c) upon receipt of confirmation of receipt of electronic-mail, or (d) upon delivery if delivered by prepaid commercial courier service. A Party must update the information in Schedule 17 as the information changes. Such changes shall not constitute an amendment to this Agreement. Waivers. Any waiver at any time by either Party of its rights with respect to any default under this Agreement, or with respect to any other matter arising in connection with this Agreement, shall not constitute or be deemed a waiver with respect to any subsequent default or other matter arising in connection with this Agreement. Any delay, short of the statutory period of limitations, in asserting or enforcing any right under this Agreement shall not constitute or be deemed a waiver of such right. Governing Law and Forum. This Agreement shall be deemed to be a contract made under, and for all purposes shall be governed by and construed in accordance with, the laws of the State of California, except its conflict of laws provisions. The Parties agree that any legal action or proceeding arising under or relating to this Agreement to which the CAISO ADR Procedures do not apply shall be brought in one of the following forums as appropriate: any court of the State of California, any federal court of the United States of America located in the State of California, or, where subject to its jurisdiction, before the Federal Energy Regulatory Commission. Merger. This Agreement constitutes the complete and final agreement of the Parties with respect to the subject matter hereof and supersedes all prior agreements, whether written or oral, with respect to the provisions of this Agreement. Counterparts. This Agreement may be executed in one or more counterparts at different times, each of which shall be regarded as an original and all of which, taken together, shall constitute one and the same Agreement. Consistency with Federal Laws and Regulations. Nothing in this Agreement shall compel either Party to violate federal statutes or regulations, or orders lawfully promulgated thereunder. If any provision of this Agreement is inconsistent with any obligation imposed on a Party by such federal statute, regulation or order, to that extent, it shall be inapplicable to that Party. No Party shall incur any liability by failing to comply with a provision of this Agreement that is inapplicable to it by reason of being inconsistent with any such federal statutes, 37 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT 18.7 18.8 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION regulations, or orders lawfully promulgated thereunder; provided, however, that such Party shall use its best efforts to comply with this Agreement, to the extent that applicable federal laws, regulations, and orders lawfully promulgated thereunder permit it to do so. Severability. If any term, covenant, or condition of this Agreement or the application or effect of any such term, covenant, or condition is held invalid as to any person, entity, or circumstance, or is determined to be unjust, unreasonable, unlawful, imprudent, or otherwise not in the public interest by any court or government agency of competent jurisdiction, then such term, covenant, or condition shall remain in force and effect to the maximum extent permitted by law, and all other terms, covenants, and conditions of this Agreement and their application shall not be affected thereby, but shall remain in force and effect and the Parties shall be relieved of their obligations only to the extent necessary to eliminate such regulatory or other.determination unless a court or governmental agency of competent jurisdiction holds that such provisions are not separable from all other provisions of this Agreement. Assignments. NCPA and the CAISO may assign its rights and obligations under this Agreement, with the either NCPA or CAISO prior written consent, in accordance with Section 22.2 of the CAISO Tariff,. which is incorporated by reference into this Agreement. Such consent shall not be unreasonably withheld. 38 ~ CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed on behalf of each by and through their authorized representatives as of the date hereinabove written. CALIFORNIA INDEPENDENT SYSTEM OPERATOR CORPORATION By: Name: Title: Date: NORTHERN CALIFORNIA POWER AGENCY By: Name: Title: Date: 39 C.~IFORNI.~ ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MS8 AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 1 NCPA’S SYSTEM FACILITIES [Section 4.1, 4.4, 4.5.3, 5.1.2, 6.1, 6.3] The following facilities form NCPA’s System, including the Points of MSS Interconnection. 4O CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Points of MSS Interconnection Member Customer Alameda Biggs Gridley Healdsburg Lodi** Lompoc Palo Alto Plumas Sierra*** Ukiah*** Silicon Valley Power* Port of Oakland Point of MSS Interconnection Oakland Substation C and Oakland Substation J Biggs Sub (60 kV and 12 kV) Gridley Sub Healdsburg Sub .Industrial Su.b (Lodi Line 1 and Lodi Line 2); and White Slough STIG1 Lompoc Sub (Lompoc Line 1 and Lompoc Line 2) Colorado Sub (Palo Alto Line 1, Palo Alto Line 2, and Palo Alto Line 3) Quincy Sub Marble Sub Babcock Sub Northern Receiving Station (NRS) (Newark-NRS No. 1, Newark-NRS No. 2, and Nortech-NRS); Kifer Receiving Station (Newark- Kifer and FMC- Kifer); and SVP Switching Station (SSS) San Leandro- Oakland "J", 10286 115-kV for Edes #1 Tap; Oakland "J" - Grant, 10244 115-kV for Edes #2 Tap; Oakland "C" Maritime Tap; and Voltage (kV) 115 (Both Points) 60 and 12 60 6O 60 (Both Industrial Points) 230 (White Slough STIG) 115 (Both Points) 115 (All 3 Points) 60 60 115 115 (All 5 NRS and Kifer Points) 230 (SSS) 115 115 2007 Normal Delivery Capability (MW) 229 29.2 62 30 124.5 72.5 379 28.3 31.4 16.7 4O 2007 Coincident Peak Load (MW) 58.03 2.71 9.87 19.89 130.72 18.94 180.75 27.96 32.13 10.73 2007 Non- Coinciden~ Peak Load (MW) 70.26 4.29 10.46 20.55 132.38 25.83 185.42 30.63 32.59 15.62 Lodi Wastewater treatment plant Load will be served via the Lodi White Slough STIG Interconnection with PG&E, be separately metered, and be included in the normal, coincident and non-coincident Load information for Lodi. 41 CALIFORNIA ][SO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Oakland Army Base Tap 115 40 *The Points of MSS Interconnection listed herein for Silicon Valley Power are governed by the terms of the Silicon Valley Power MSS Agreement with the CAISO with respect to the operational and other matters addressed in that agreement. **The Normal Delivery Capacity listed for the City of Lodi is expected to be upgraded in the near future, and does not reflect the offset provided by the Lodi Combustion Turbine, approximately 25 MW, that wil be used to suppress peak demand when the Normal Delivery Capacity is exceeded. ***The Normal Delivery Capacity listed for the City of Ukiah and Plumas Sierra is expected to be upgraded in the near future. The Points of Interconnection for all Generating Units listed on Schedule 14 also are Points MSS of Interconnection. Other System Facilities 1. Double Circuit 230 kV line from Collierville to Bellota. 2.MSS Members’ rights in Transmission Agency of Northern California’s (TANC) ownership of the California-Oregon Transmission Project (COTP), to the extent that a portion of the COTP remains in the CAISO Balancing Authority Area. 3.Two 230 kV lines from Geysers to Castle Rock Junction. NCPA 230 kV No. 1 goes from Geothermal Plant No. 1 to Lakeville. NCPA 230 kV No. 2 goes from Geothermal Plant No. 2 to Fulton. 4. All facilities listed on Schedule 14 of this Agreement. 42 1~ CALII:ORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 2 INTERCONNECTED OPERATION STANDARDS [Section 4.2] The CAISO and NCPA shall jointly maintain stable operating parameters and control real and reactive power flows in accordance with the following Interconnected Operation Standards. NCPA Responsibilities 1.0 NCPA shall operate the facilities of NCPA’s System at each Point of MSS Interconnection in such manner as to avoid any material or adverse impact on the CAISO Balancing Authority Area. In accordance with this performance goal, NCPA shall: 1.1 Operate the facilities of NCPA’s System at each Point of MSS Interconnection within established operating parameters including normal ratings, emergency ratings, voltage limits, and balance of load between electrical phases. 1.2 Maintain primary and backup protective systems such that faults on NCPA’s System facilities will be cleared within the timeframe specified by the Participating TO and NCPA with minimal impact on the CAISO Controlled Grid. 1.3 Maintain Load power factor at each Point of MSS Interconnection with the CAISO Controlled Grid in accordance with Section 8.3 of this Agreement unless requested by PG&E to operate power factor at a specific value for system reliability purposes. 1.4 In addition, NCPA shall operate the facilities of NCPA’s System at each Point of MSS Interconnection in accordance with the requirements applicable to Utility Distribution Companies in the CAISO Operating Procedures and standards, and such that at the Points of MSS Interconnection between the CAISO Controlled Grid and NCPA’s System no circuits or equipment shall exceed the allowable ampacity rating or simultaneous transfer limit between the CAISO Controlled Grid and NCPA’s System (such simultaneous transfer limit shall be studied and established by the Parties). If the actual or anticipated power flow between the CAISO Controlled Grid and NCPA’s System causes a circuit at a Point of MSS Interconnection to exceed its applicable ampacity rating or such flow exceeds or is anticipated to exceed the agreed to allowable simultaneous transfer limit between the CAISO Controlled Grid and NCPA’s System, and further if the CAISO determines and NCPA concurs with the CAISO’s determination, in accordance with Good Utility Practice, that NCPA’s System is the cause of such 43 NCPA MSS AGG REGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION exceedance or anticipated exceedance, NCPA retains the right, and the CAISO shall have the right to require NCPA, to take immediate action to reduce such flow on the overloaded circuit or reduce such simultaneous power flow between the CAISO Controlled Grid and NCPA’s System by one or more actions (as determined by NCPA) including, but not limited to, increasing internal Generation within NCPA’s System or curtailing MSS Member Load as necessary. If the CAISO determines, in accordance with Good Utility Practice, that NCPA’s System is not the cause of the existing or anticipated exceedance, the CAISO may require third parties to take necessary action to reduce flows on overloaded circuits or reduce simultaneous power flows between the CAISO Controlled Grid and NCPA’s System if applicable and allowable through arrangements that the CAISO may have with such third parties or pursuant to the CAISO’s authority under the CAISO Tariff or its delegated jurisdictional authority through WECC or NERC. If the CAISO is unable to determine a) whether NCPA’s System caused, or b) to what extent NCPA’s System may have caused, such exceedance or anticipated exceedance, or c) the Parties do not agree on the causation determination, the Parties agree, in accordance with Good Utility Practice, to confer and mutually decide what actions shall be taken. CAISO Responsibilities 2.0 The CAISO shall operate the CAISO Controlled Grid at each Point of MSS Interconnection with NCPA in such manner as to avoid any material or adverse impact on NCPA facilities. In accordance with this performance goal, the CAISO shall: 2.1 Participate with all affected parties (including NCPA and PG&E) in the development of joint power quality performance standards and jointly maintain compliance with such standards. 2.2 Observe NCPA grid voltage limits specified in Attachment 1 including requirements for reduced voltage on CAISO Conti*olled Grid facilities which apply during heavy fog (or other unusual operating conditions) as needed to minimize the risk of insulator flashover. Any anticipated reduction in operating voltages on CAISO Controlled Grid facilities shall be studied and established by NCPA and the CAISO. 2.3 Approve NCPA’s maintenance requests in a timely manner for transmission facilities that impact the CAISO Controlled Grid, and shall not unreasonably withhold approval of such requests for authorization to perform energized insulator washing work or to take planned Outages needed to replace or insul- grease insulators. 2.4 Support NCPA investigation of power quality incidents, and provide related data to NCPA in a timely manner. 44 ~ C~_Z.I~OP.NIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION 2.5 Support installation of apparatus on the CAISO Controlled Grid to improve power quality, and take all reasonable measures to investigate and mitigate power quality concerns caused by actions or events in neighboring systems or Balancing Authority Areas. 2.6 Maintain Load power factor at each Point of MSS Interconnection with NCPA’s System in accordance with Section 8.3 of the Agreement. 45 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 2 ATTACHMENT 1 NCPA GRID VOLTAGE LIMITS There are no NCPA grid voltage limitations at the present time. 46 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 3 RIGHTS OF ACCESS TO FACILITIES [Section 4.5.1] 1.0 t.1 1.2 1.3 1.4 2.0 Equipment Installation. In order to give effect to this Agreement, a Party that requires use of particular equipment (the equipment owner) may require installation of such equipment on property owned by the other Party (the property owner), provided that the equipment is necessary to meet the equipment owner’s service obligations and that the equipment shall not have a negative impact on the reliability of the service provided, nor prevent the property owner from performing its own obligations or exercising its rights under this Agreement. Free Access. The property owner shall grant to the equipment owner free of charge reasonable installation rights and rights of access to accommodate equipment inspection, maintenance, repair, upgrading, or removal for the purposes of this Agreement, subject to the property owner’s reasonable safety, operational, and future expansion needs. Notice. The equipment, owner shall provide reasonable notice to the property owner when requesting access for site assessment, equipment installation, or other relevant purposes. Such access shall not be provided unless the parties mutually agree to the date, time, and purpose of each access. Agreement on the terms of the access shall not be unreasonably withheld or delayed. Removal of Installed Equipment. Following reasonable notice, the equipment owner shall be required, at its own expense, to remove or relocate equipment, at the request of the property owner, provided that the equipment owner shall not be required to do so if it would have a negative impact on the reliability of the service provided, or would prevent the equipment owner from performing its own obligations or exercising its rights under this Agreement. Costs. The equipment owner shall repair at its own expense any property damage it causes in exercising its rights and shall reimburse the property owner for any other reasonable costs that it may be required to incur to accommodate the equipment owner’s exercise of its rights under Section 4.5 of this Agreement. Rights to Assets. The Parties shall not interfere with each other’s assets, without prior written agreement. Inspection of Facilities. In order to meet their respective obligations under this Agreement, each Party may view or inspect facilities owned by the other Party. 47 ~ ISALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Provided that reasonable notice is given, a Party shall not unreasonably deny access to relevant facilities for viewing or inspection by the requesting Party. 48 ~ C.ALIFOB.N[A ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 4 MAINTENANCE COORDINATION [Section 5.1.2, 6.3] By October 15th of each year, NCPA shall exchange with the CAISO a provisional planned Outage program for all lines and equipment in Schedule 1. That document will be updated quarterly or as changes occur to the proposed schedule. The CAISO shall approve all proposed Outages on equipment and lines listed on Schedule 1 unless a proposed Outage would cause the CAISO to violate Applicable Reliability Criteria. Approval of Outages shall not be unreasonably withheld. As noted on Schedule 1, some facilities are jointly owned by NCPA and one or more other entities. The CAISO acknowledges that, under the terms of the operating agreements applicable to each such facility, NCPA may not be able to control .unilaterally the timing of Outages. NCPA shall exercise its rights under the operating agreements, if any, applicable to each jointly owned facility listed on Schedule 1 to coordinate scheduling of Outages with the CAISO in accordance with this Agreement to the maximum extent possible and shall not enter into any operating agreement or amendment to an existing operating agreement with respect to any such facility that diminishes NCPA’s rights to schedule Outages. However, NCPA shall communicate directly to the CAISO regarding its coordination of scheduled Outages. Applications for scheduled work shall be submitted to the CAISO by NCPA’s Grid Operations group via means to be agreed to by both Parties. The documents submitted by NCPA shall record the details for all work and become the database for reporting and recording Outage information. 49 CALIFORNIA I50 NCPA MSS AGGREGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 5 CRITICAL PROTECTIVE SYSTEMS [Section 5.3] Distribution protective relay schemes affecting the CAISO Controlled Grid are those associated with transformers that would trip transmission breakers and/or busses at NCPA’s Points of MSS Interconnection when activated. These would include any of the following: 1.High Side Overcurrent Relays 2.Differential Overcurrent Relays 3.Sudden Pressure Relays 4.Low Oil Relays 5.Neutral Ground Overcurrent Relays 6.On fuse protected transformers, it would be the high-side fuses. NCPA shall provide the CAISO a description of the relaying schemes at the Points of MSS Interconnection prior to commencing operations as an MSS Aggregator. 5O NCPA MSS AGGR EGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION CAISO: SCHEDULE 6 OPERATIONAL CONTACT [Section 5.4] Transmission Dispatcher (Folsom): Transmission Dispatcher (Alhambra): Shift Supervisor: Director of Grid Operations: City/State/Zip Code (916) 351-2492 or 2497 (626) 537-2831 or 2832 (916) 351-2490 (916) 351-2101 California ISO 151 Blue Ravine Road Folsom, CA 95630 Other CAISO Dispatch Operations Phones: Generation Dispatcher (Folsom) Generation Dispatcher (Alhambra) (916) 351-2489 (626) 537-2830 Reliability Coordinator (916) 351-2498 NCPA: Name: Title: Address: City/State/Zip Code: Phone: Fax: E-Mail Address Fred Young Manager of Coordinated Systems Operations 651 Commerce Drive Roseville, CA 95678 (916) 786-3518 (916) 781-4226 fred .you ng@ncpa, com 51 ~ CA[,:[’~O’2,.NtA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 7 EMERGENCIES [Section 7.2] The CAISO shall notify NCPA’s Power Control Center ("PCC") Operator, as identified in Schedule 6, of the emergency, including information regarding the cause, nature, extent, and potential duration of the emergency. The PCC Operator shall make the appropriate notifications within NCPA organization. The PCC Operator shall then take such actions as are appropriate for the emergency. NCPA shall make requests for information from the CAISO regarding emergencies through contacts to the CAISO’s Operations Shift Supervisor, by NCPA’s PCC Operator, or NCPA!s Information Officer may coordinate public information with the CAISO Communication Coordinator. NCPA is required to estimate service restoration by geographic areas, and shall use its call center and the media to communicate with customers during service interruptions. NCPA is also required to communicate the same information to appropriate state and local governmental entities. For transmission system caused outages, the CAISO’s Operations Shift Supervisor will notify the PCC Operator, who will make appropriate notifications within NCPA’s organization of any information related to the outage such as cause, nature, extent, potential duration and customers affected. NCPA and CAISO Grid Control Center logs,. Electric Switching Orders and Energy Management System temporal database will be used in preparation of Outage reviews. These documents are defined as the chronological record of the operation of the activities which occur with the portion of the electrical sYstem assigned to that control center. The log shall contain all pertinent information, including orders received and transmitted, relay operations, messages, clearances, accidents, trouble reports, daily switching program., etc. NCPA shall retain records in accordance with its standard practices for six years. 52 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 7.1 COMPENSATION FOR EMERGENCY DISPATCH INSTRUCTIONS [Section 7.1.3] [Note: cjs:: Incorporated into Section 7.1.3.] Negotiated Opportunity Proxy Price The Negotiated Opportunity Proxy Price is meant to represent the opportunity cost of operating a facility that is dispatched by the CAISO. The Negotiated Opportunity Proxy Price should reflect both the actual costs incurred as well as the opportunity costs, including but not limited to the use limited nature of a generating facility. The Negotiated Opportunity Proxy Price may be used both to value compensation for generating capacity and/or Energy supplied in response to Dispatch Instructions or as pricing mechanism for resources that have been mitigated through the MMP-RRD process and for Energy that does not have an Energy Bid price. The Negotiated Opportunity Proxy Price is calculated in the following manner: Negotiated Opportunity Proxy Price (NOPP) = The NOPP must be calculated as: Fuel Cost + Variable O & M Cost + Start-Up Fuel Cost + Minimum Load Cost + Fuel Imbalance Cost and Penalties + Value of Storage + Use Limited Cost Adder + Emissions Cost Where: Fuel Cost is equal to the quantity of Energy (MWh) provided in response to a Dispatch Instruction multiplied by the applicable heat rate (MMBTU / MWh) of the facility providingthe Energy, as registered within the NCPA Master File, multiplied by the applicable Fuel Price for the settlement period ($ / MMBTU). Fuel Cost does not include Start-Up Fuel Cost or Fuel Imbalance Costs and Penalties. Variable Operation and Maintenance Costs (Variable O & M Cost) is equal to the quantity of Energy (MWh) provided in response to a Dispatch Instruction 53 ~ CALI~O~{N[A ISO NCPAMSSAGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION multiplied by the Variable O & M rate of the facility providing the Energy. The Variable O & M rate for each of the NCPA Generating Resources is developed and proved by NCPA. Start-Up Fuel Cost is equal to the quantity of start-up fuel (MMBTU) and electric energy consumption used to deliver the quantity of Energy (MWh) provided in response to a Dispatch Instruction, derived from the Start-Up curves listed within the NCPA Master File, multiplied by the applicable Fuel Price for the settlement period ($ / MMBTU). The Start-Up Fuel Cost will vary by resource type and by cooling time for the applicable resource, Minimum Load Cost is equal to the to quantity of fuel (MMBTU) used to deliver the quantity of Energy (MWh) provided in response to a Dispatch Instruction, derived from the Minimum Load heat rate curves listed within the NCPA Master File, multiplied by the applicable Fuel Price for the settlement period ($ / MMBTU). Fuel Imbalance Cost & Penalties, which may be the result of a declared Operating Flow Order or an Emergency Flow Order, if applicable, is equal to the costs incurred by NCPA as charged by NCPA’s gas supplier. Value of Storage (VOS) is the NCPA assigned "fuel cost" used to optimize the economic value of generation from hydroelectric projects. The VOS is computed as a function of: 1) future value of generation as indicated by forward power prices, 2) near and long-term hydrology scenarios (dry, average, wet, etc.) based on long-term precipitation records, and 3) river flow limitations and requirements. The VOS is used to guide day-ahead and real-time hydroelectric schedule decisions by NCPA. The VOS for each of the NCPA hydro electric facilities will be provided by NCPA. Use Limited Cost Adder is an "opportunity cost factor" NCPA assigns to optimize the economic dispatch of generators with seasonal or annual operation limits. For example, a combustion turbine Generating Facility will a maximum annual limit on operating hours will be assigned a non-zero Use Limited Cost Adder prior to the summer season to assure the availability of the unit to serve summer peaking loads. The Use Limited Cost Adder for each of the NCPA Generating Resources, as applicable, will be provided by NCPA. Emissions Cost is equal to the cost resulting from charges and or penalties for operating a Generating Facility established by the applicable air resource board authority. Fuel Price Calculation 54 CALIFORNIA IS0 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION The Fuel Price used within the calculation of Negotiated Opportunity Proxy Price is based on the terms of the NCPA Consolidated Natural Gas Purchase and Management Agreement. Except for fuel consumed during the last two days of the calendar month, the Fuel Price applied to the amount of fuel consumed by a NCPA Generating Facility to deliver Energy n response to an Emergency Dispatch Instruction will be equal to the PG&E Citygate Daily Index Price + $.005 / MMBtu published on the first available transaction date, other than those dates in which a Operating Flow Order or Emergency Flow Order has been declared, after the day on which the gas was consumed, plus any applicable gas transportation charges. The Fuel Price applied to the amount of fuel consumed during the last two days of the calendar month by a NCPA Generating Facility to deliver Energy ~n response to an Emergency Dispatch Instruction will be equal to the PG&E Citygate Daily Index Price + $.005 / MMBtu published on the date of consumption, plus any applicable gas transportation charges. The PG&E Citygate Daily Index Price is published by the Platt’s Gas Daily. In the event that the Platt’s Gas Daily ceases to be published, the Parties shall agree on a replacement publication. [NOTE:cjs: The above language [Schedule 7.1] is pending as NCPAis working with Potomac Economics on DEB relative to the MSS hydro and use limited resources. Schedule 7.1 may not be needed. NCPA reserves the right to continue discussion with CAISO regarding the appropriate incorporation of Schedule 7.1, and any required modifications to Section 7.1.3, if it is determined by NCPA that efforts with Potomac Economics are not sufficient to provide fair and appropriate compensation.] 55 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 8 UNDERFREQUENCY LOAD SHEDDING [Section 7.4.1, 7.4.5] The objective of the Underfrequency Load Shedding (UFLS) program is to provide security and protection to the interconnected bulk power network by arresting frequency decay during periods of insufficient resources. NCPA’s UFLS program establishes Underfrequency Load Shedding objectives consistent with the Load Shedding policies of the Western Electricity Coordinating Council, the North American Electric Reliability Corporation, and NCPA. NCPA’s UFLS program, as implemented by the MSS Members, shall at all times comport with the requirements of the WECC Coordinated Off-Nominal Frequency Load Shedding and Restoration Plan (Final Report November 25, 1997, as revised December 5, 2003) and any of its subsequent amendments. NCPA’s UFLS program utilizes WECC planning criteria in this area. Per WECC requirements, UFLS is on the feeder side of the transformer. NCPA’s UFLS program, other than for the Port of Oakland, is set forth in Attachment A to NCPA’s EAP, which is attached to Schedule 11, and incorporates the tripping scheme set forth therein. The Port of Oakland will continue to participate in the UFLS program of PG&E. The Port of Oakland’s Interconnection Agreement with PG&E, dated December 15, 2000 (with a termination date in Section 5.3.1(b) of that agreement of no later than January 1, 2021) and which, to the extent relevant to the UFLS obligations under this Agreement, is incorporated herein by reference, provides the Port of Oakland’s UFLS program for distribution circuits when required by PG&E in accordance with the PG&E Electrical Emergency Plan (EEP) dated June 20, 2002 and which, to the extent relevant to the UFLS obligations under this Agreement, is incorporated herein by reference. NCPA will develop a separate UFLS program for the Port of Oakland prior to such time as the Port of Oakland’s Interconnection Agreement with PG&E described above may cease to apply for any reason to the Port of Oakland, including without limitation by way of amendment or termination, or that would in the CAISO’s discretion effectively cease to satisfy the UFLS obligations under this Agreement. Until such time as NCPA and the Port of Oakland implement a program for Port of Oakland’s UFLS independent of PG&E, NCPA and the Port of Oakland shall continue to operate in accordance with the applicable PG&E EEP dated June 30, 2002 and the Port of Oakland’s Interconnection Agreement with PG&E, dated December 15, 2000. NCPA will notify the CAISO immediately if the PG&E UFLS program described above ceases to apply to Port of Oakland. 56 ~ CALifORNIA ISO NCPA MSS AGGREGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION This Schedule 8 and the NCPA EAP shall be revised to incorporate updated UFLS program, including any separate UFLS program for Port of Oakland, upon implementation by NCPA. 57 CALIFORNLA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 9 OTHER AUTOMATIC LOAD SHEDDING [Section 7.4.1] NCPA has no other automatic Load Shedding devices other than those identified in Schedule 8. 58 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 10 MANUAL LOAD SHEDDING [Section 7.4.2] Criteria for the implementation of manual Load Shedding are set forth in the NCPA Emergency Action Plan attached to Schedule 11. 59 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 10A ROTATING LOAD CURTAILMENT PROCEDURES [Section 7.4.2] NCPA’s rotating Load curtailment procedures are described in the NCPA Emergency Action Plan attached to Schedule 11. To maintain a minimum amount of continuously interrupted Load, as directed by the CAISO, for an extended amount of time, no portion of NCPA’s interrupted Load shall be restored unless an equal or greater amount of Load is interrupted first. 6O CAi.:~Oi:N[A ISO NCPA MSS AGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE "IOB INTERRUPTIBLE LOAD [Section 7.4.2] Should NCPA or any MSS Member establish an interruptible Load program and seek to Bid any interruptible Load into any CAISO market, NCPA shall provide a complet,e description of the program to the CAISO at least sixty (60) days prior to the submission of the first such Bid by NCPA’s Scheduling Coordinator and all applicable Operating Procedures shall be followed. 61 ~ CALII~ORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 11 EMERGENCY ACTION PLAN [Sections 5.2, 7.1, 7.1.1, 7.1.2, 7.5.1 and 7.5.2] NCPA’s current Emergency Action Plan is attached to this Schedule 11. The NCPA Dispatch Center (NDC) will be the first point of contact for NCPA Emergency Operations under this Agreement, except with respect to the Port of Oakland. All directives/orders affecting the individual MSSAA Members, other than the Port of Oakland,will be issued through the NDC. The Port of Oakland will continue to participate in the UFLS program and the manual Load Shedding program of PG&E, subject to the terms of Schedule 8, this Schedule 11, and the attached EAP. The Port of Oakland’s Interconnection Agreement with PG&E, dated December 15, 2000 and which, to the extent relevant to the manual Load Shedding obligations under this Agreement, is incorporated herein by reference, provides the Port of Oakland procedure for service interruptions to distribution circuits when required by PG&E to implement manual Load Shedding in accordance with the relevant applicable PG&E Electrical Emergency Plan (EEP) dated June 30, 2002 and which, to the extent relevant to the manual Load Shedding obligations under this Agreement, is incorporated herein by reference. NCPAwill develop a separate manual Load Shedding program for the Port of Oakland prior to such time as the Port of Oakland’s Interconnection Agreement with PG&E described above may cease to apply for any reason to the Port of Oakland, including without limitation by way of amendmeHt or termination, or that would in the CAISO’s discretion effectively cease to satisfy the manual Load Shedding obligations under this Agreement. Until such time as NCPA and the Port of Oakland implement a program for Port of Oakland manual Load Shedding and rotating service interruptions independent of PG&E, NCPA and the Port of Oakland will continue to operate in accordance with the applicable PG&E EEP dated June 30, 2002 and the Port of Oakland’s Interconnection Agreement with PG&E, dated December 15, 2000. NCPA will notify the CAISO immediately if the PG&E manual Load Shedding program described above ceases to apply to Port of Oakland. This Schedule 11 and the NCPA EAP shall be revised to incorporate updates, including any separate manual Load Shedding program for Port of Oakland, upon implementation by NCPA. 62 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION NCPA EMERGENCY ACTION PLAN (EAP) PURPOSE A. The primary purpose of this plan is to provide the MSS Members (MSSs), other than the Port of Oakland, and NCPA Staff with a written procedure to follow in case of System Emergencies that may directly and/or indirectly affect the NCPA Member(s) abilities to schedule their resources and MSS Demand within the California Independent System Operator (CAI$O) Balancing Authority Area. The Port of Oakland will be subject to the procedures in case of System Emergencies specified in the Pacific Gas and Electric Company (PG&E) Electrical Emergency Plan (EEP) dated June 30, 2002 and is not subject to the procedures set forth herein. There may be times that the CAISO Balancing Authority Area is experiencing adverse conditions (i.e., storms, fires, loss of generation, transmission, etc.) causing large interruptions to load throughout the state. During these conditions this EAP will allow the NCPA Dispatch Center (NDC)to operate under established emergency procedures with CAISO & PG&E. System Emergencies shall be limited as specified in Section 7.1 of the NCPA MSS Aggregator Agreement (MSSAA), whereby NCPA acts as MSS Aggregator for the MSS Members within the Service Area of the NCPA System, dated 9/1/2002, as amended. B. The secondary purpose of this plan is to satisfy the requirements of the MSSAA. It is NCPA’s goal to use all available resources to help limit the amount of power interruption to all NCPA Member Cities by assisting the CAISO, PG&E-TOC, SMUD (in coordination with Western as required) and/or the WECC Reliability .Coordinators in the prevention and/or the restoration of grid related outages throughout the Western United States. The CAISO will make every effort during a System Emergency that is the result of a deficiency of resources to meet Demand in the CAISO Balancing Authority Area, as specified in Section 7.7.11.4 of the CAISO’s Tariff, and to facilitate the continued export of Energy to the City of Roseville to which the City of Roseville would otherwise be entitled. However, the CAISO may request that the MSS limit exports to the City of Roseville during a System Emergency that is not the result of a deficiency of resources to meet Demand in the CAISO Balancing Authority Area but instead occurs due to operating contingencies, which may include but not be limited to a forced loss of resources and/or transmission components or may otherwise be caused by an Uncontrollable Force. REFERENCES ¯ NCPA Emergency Notification Procedure (7/07) o NCPA Load Tripping Plan (2/98) o NCPA System Alert Procedure #600-15 63 I~ CALifORNiA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION , NCPA EAP Lake Alpine Dam ¯ NCPA EAP.Utica Reservoir Dam o NCPA EAP New Spicer Meadows Dam o NCPA EAP McKay’s Point Diversion Dam ¯ NCPA/CAISO Reserve Sharing Agreement ¯ CAISO Operating Procedure E501 -System Restoration ~ CAISO Operating Procedure E502 - Emergency Manual Load Shedding ¯ CAISO Operating Procedure E503 - Underfrequency Load Shedding o CAISO Operating Procedure E508 - Electrical System Emergency ¯ CAISO Operating Procedure E509 - Restricted Maintenance Operations ¯ CAISO Operating Procedure E511 - Load Reduction Programs ¯ CAISO Operating Procedure T133Z - Effectiveness Factors - Bay Area o PG&E Electric Emergency Plan - Dated 06/30/2002 RESPONSIBILITY 1.0 The NDC will be the first point of contact for NCPA Emergency Operations under the NCPA Operating Procedures, CAISO Emergency Operations under the CAISO Operating Procedures and all Emergency Operations under the MSSAA. All directiveslorders affecting the individual MSSAA Members, will be issued through the NDC. In the event of any conflicting instructions/orders with the above procedures from a third party, and in the absence of any direct order from the WECC Reliability Coordinator, the NDC instructions/orders will prevail. The NDC will ensure that all emergency procedures are followed and ~all instructions for the operation of all the NCPA Resources are directed by the NDC or its designate following the applicable NERC Policies and WECC Criteria, as well as "Good Utility Practice". 1.1 The NDC may have to move operations to the Backup Dispatch Center located at the NCPA CT#1 Roseville site. During this time, all orders, instructions and coordination with CAISO & PG&E will be communicated by the NDC from the Backup Dispatch Center. NCPA on call staff including the dispatch support person will be dispatched per this EAP by the NDC either from the normal or back-up locations. See Attachment "C". a. The MSSAA Members Underfrequency Load Shedding Schemes are to be in compliance with WECC requirements and in service at all times or have reported to the NDC the reason for being out of service and the estimated time it will return to normal status (in service). See Attachment "A". b. The NCPA Scheduling Coordinator NCPA-SC) will follow the NCPA Emergency Notification Procedure for communication with the MSSAA Members and their associated Operation Centers of all conditions calling for the NCPA EAP and/or the CAISO System Emergency Operating Procedures to be placed in service. 64 CALIFORNIA. ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION PROCEDURE ~ 2.0 The NDC will make notifications to all parties associated with the NCPA Emergency Notification Procedure when implementing the EAP. The EAP will be implemented when, in the judgment of the NDC, conditions in the CAISO Balancing Authority Area will be affecting NCPA Operations or if the CAISO, PG&E Transmission Operation Center (PG&E-TOC) and/or WECC Reliability Coordinators declare a WECC System or statewide emergency. The EAP may also be implemented by the NDC in cases where only NCPA is experiencing an emergency (i.e., EAP’s associated with the Hydro Project and/or other resource failures). 2.1 As provided in the MSSAA, the CAISO will communicate all instructions for NCPA to follow through the NDC (the CAISO may communicate with the NDC directly or through its assignee, provided that the procedure for the CAISO’s designation of any assignee is agreed to by NCPA). All instructions will be followed under the MSSAA to the extent they do not conflict with NCPA Policies & Procedures, as incorporated in NCPA EAP, or violate any State and Local laws. a. NCPA can only deliver power outside of the MSS that is surplus to the MSS full requirements as reasonably determined and documented by the NDC. b. NCPA cannot supply generation to third parties unless the native load of NCPA and the MSS Members is being 100% served. c. NCPA while participating in involuntary load curtailments cannot provide such realized surplus power unless the CAISO is under System Emergency Stage 3 Contingency Conditions. 2.2 NCPA will communicate with CAISO, PG&E-TOC, WECC Reliability Coordinator and any affected third party during the time the EAP is in force. a. In coordination with the EAP, the NDC will implement NCPA Policy #600-15 and Issue a NCPA System Alert Message. All work on NCPA Resources and their associated facilities is to be cancelled and all resources that can be returned to service should be returned with the exception of annual planned Unit outages. b. The NDC will coordinate the implementation of all CAISO Emergency Procedures with the MSSAA Members including Stage-3 involuntary load curtailments and the potential of manual deep load shedding by CAISO through PG&E-TOC (see Attachment "B" matrix). NCPA will provide all necessary post-event information to CAISO, and if applicable to PG&E-TOC, regarding the amounts of load curtailed per MSS Member. c. The NDC Shift Dispatcher has the authority to implement the operations under this EAP and to dispatch the NCPA Resources to assist in restoring the CAISO and/or WECC Grid to normal status even if doing so requires manual load shedding of the 65 CALIFORNIA I~qO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION MSSAA Member Loads or other actions that may be necessary as determined by the NDC Shift Dispatcher. NCPAACTIONS 3.0 The NDC will contact the Dispatch Supervisor and set-up to have double coverage. in the NDC when implementing the EAP. In addition, the Relief Operators are to be notified that the NCPA-EAP has been implemented and they are to be on call during this time in case additional personnel are needed. The NDC computer programmer and the dispatch support person will be notified to standby in case of SCADA or other related computer trouble during the time the EAP is in service. 3.1 The NCPA Unmanned Generating Plants are to be manned, this includes the Collierville Hydro Plant, CT#1 (3 simple cycle Units), the STIG 50mw Unit and the Murphy’s Hydro Headquarters. The NCPA Geothermal Project (four units) is already manned; they need to know that the EAP has been implemented. The transmission connections to the main grid are controlled from the power plant switches and can be operated by the NDC via SCADA for all stations except the Geothermal facility, which are controlled by SCADA at the plant sites. Communication with the plants before operation of station switches should be established before any operations occur. a. The NCPA Collierville generating Units (250mws) should be on line at minimum load, available for full load pickup if requested by the CAISO, PG&E-TOC and/or the WECC Reliability Coordinators. b. All backup generators for station service and UPS Systems batteries including the NDC are to be available and maintained in good operating condition a~ all times with ample fuel supply/charge so as to meet the demand needed during total blackout conditions. c. The NDC staff will have all applicable operating procedures readily available for any system emergency in which NCPA may be involved either directly or in fulfillment of its obligations pursuant to the MSSAA to aid in the prevention of damage to and/or the restoration of the CAISO and/or the WECC associated grid. d. The NDC will be ready to switch Operation Centers over to the Backup Dispatch Center at the NCPA Roseville CT Site if the need arises. The NCPA Dispatcher and the dispatch support person are to bring with them the EAP along with any other documents that may be needed before additional help arrives. e. The NDC will follow the WECC communication plan as it pertains to our NDC operation. 66 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION f. The NDC VHF base radio station with direct communication to all generation facilities will be tested and kept in service at all times. Communication with the generation facilities is to be established during the times the EAP is in service. g. The NCPA Sites all have cell phones as a backup. Standing orders will be issued to all plant sites on operation of the Units in case of communication loss including Black Start procedures. h. The NDC will Black-Start all available units either on orders from CAISO, PG&E- TOC, the WECC Reliability Coordinator to assist in restoration of the California Grid or as needed by the NDC for load restoration within the cities of Alameda or Lodi. i. In case of a natural gas fuel supply shortage preceding and/or following an emergency under this EAP, the three (3) CT#1 Units can be switched to fuel oil. If the shortage is caused by extreme cold weather NCPA will follow orders issued by our gas supplier and also switch to fuel oil. If the CT#2 Unit (STIG) is curtailed, the CT#1 Units on fuel oil can substitute for the loss in generation from CT#2 Unit. 3.2 NCPA will follow all Emergency Operating Procedures listed above and will take and implement instructions from CAISO, PG&E-TOC and WECC Reliability Coordinators to aid the grid in its restoration efforts. 3.3 All news media inquiries received by the NDC or other NCPA Staff during abnormal conditions, should be directed to the on site supervisor. To the extent possible, all factual information released to the media will be coordinated with CAISO, and PG&E- TOC, if applicable. If no supervisor is on site then the supervisor most informed of the current system conditions should be contacted, see Emergency Notification Procedure contact list and numbers. This procedure will be modified as conditions warrant. Fred Young, Manager Coordinated System Operations. ATTACHMENT "A" = Off-Nominal Frequency Relay Plan ATTACHMENT "B" = Load Shedding Scenarios ATTACHMENT "C" = Backup Dispatch Center Plan 67 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Attachment A Off-Nominal Frequency Relay Plan As specified in Section 3.2.2 of this Agreement, the MSSAA Members are individually responsible for compliance with the WECC and NERC Reliability Standards and criteria applicable to the functions for which each MSSAA Member has respectively registered with NERC. At the present time, the MSSAA Members are responsible either individually or in aggregate for complying with the WECC Coordinated Off-Nominal Frequency,Load Shedding and Restoration Plan (Final Report published November 25, 1997, as revised and amended December 5, 2003). The individual and/or aggregate amounts of load to be shed by the MSSAA Members as part of this Off-Nominal Frequency Relay Plan is listed in the NCPA Load Tripping Plan. 68 k- Z W LU o 0 o~O~ ~ CALII~ORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Attachment C Relocation of Dispatch. Operations Rosevitle CT; Backup Dispatch Center . 2155 Nichols Drive - Rocklin, CA 95765 In the unlikely event that the NCPA Dispatch Center (NDC) must be evacuated, the dispatch operations will be conducted from the Disaster Recovery Center (DRC) located at the Roseville CT site. The following procedure optlines the steps required to relocate to the DRC with the functionality necessary to continue all real-time operations. Steps to be completed by the Dispatcher on duty at the NDC: 1. Collect the following items: a.Current day’s preschedules (other days if available) b.RT changes sheet, Turnover sheet, COTP limits and current changes. c.Operations binder d.Hydro/Geo Binders e.Emergency Action Plan binders (NCPA and Hydro project) f.Dispatch cell phone and wall/vehicle chargers (916-849-0532) g.Dispatch key set 2.Forward phones to CT site (see confidential procedure in SC and Dispatch Operations Manual). 3.Proceed to DRC by following directions below Steps to be completed by the Scheduling Coordinator on duty at the NDC: 1. Collect the following items a. Current’s day’s check off sheets (other days if available) b. Red "SC Operations Manual" binder 2.Forward phones to CT site (see confidential procedure in SC and Dispatch Operations Manual). 3. Proceed to DRC (see directions in SC and Dispatch operational binder) To obtain access to DRC follow directions located in confidential envelope contained within the operations binder. Steps to be completed by the Dispatcher on duty at the DRC: 1.Notify WAPA, SMUD, APM, CAISO, and PG&E of move to DRC 2.Establish communication with all plants and members (see Emergency Notification List) 3.Continue to load follow based on most recent meter readings available Steps to be completed by the Scheduling Coordinator on duty at the DRC: ¯ Notify operations supervisor(s) and support personnel of move to DRC o Establish communication with the CAISO Steps to be completed by support personnel at the DRC: 1. Setup and/or maintain all tools necessary to operate the MSS. 71 ~ CALII~ORI/IA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 12 LOAD RESTORATION [Section 7.4.4] NCPA shall follow the procedures set forth below in this Schedule 12 in promoting Orderly, coordinated restoration of electric systems after a major system disturbance has occurred which resulted in Under-frequency Load Shedding ("UFLS") in California. Immediately after UFLS has occurred in NCPA’s System, NCPA shall remain in contact with PG&E’s Area Control Center (ACC) until normal frequency has been restored throughout the CAISO Balancing Authority Area or the CAISO Shift Supervisor has concluded that such full-time communications can be terminated. Emergency communications over the California ACC Hot-line will be under the direction of the CAISO Shift Supervisor and the senior dispatcher present at the PG&F ACC(s). Manual Load restoration shall not normally be initiated until the California ACC Hot Line is attended. No Load is to be manually restored unless directed by the CAISO, either directly or through its assignee, provided that the procedure for the CAISO’s designation of any assignee is agreed to by NCPA, after the frequency has recovered and there is indication that the frequency can be maintained. NCPA shall await direction from the CAISO or its assignee, who will be in contact with the CAISO Shift Supervisor. The CAISO Shift Supervisor shall determine whether adequate generation resources are available on line to support the Load to be restored. If the CAISO cannot meet the WECC and NERC Disturbance Control Standard or the Control Performance Standard or other applicable Reliability Standards post disturbance, no manual Load restoration shall be permitted. If the frequency is such that automatic Load restoration occurs under these conditions, if NCPA has restored Load automatically, it will manually shed an equivalent amount of Load to offset the Load which was automatically restored. Restoration of ties and off-site power Supply to nuclear generating facilities should be given top priority. Manual Load restoration will be deferred during ¯ periods of tie restoration. NCPA should be equipped and prepared to drop Load manually when necessary to allow frequency recovery sufficient to re-establish CAISO intra-area ties and Interties between the CAISO Balancing Authority Area and outside systems. Where manual Load Shedding is required, the CAISO shall make reasonable efforts to allocate the Load Shedding requirement equitably among NCPA as the MSS Aggregator, UDCs, and MSS Operators where Load Shedding shall be beneficial, and such Load Shedding shall be made in accordance with Section 7.4. 72 ~ CA~_IFORNIA ISO NCPA MSS AGGREGATORAGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION NCPA shall use its existing plans and priorities to restore Load within the parameters given by the CAISO, giving the appropriate priority to essential services such as military, public safety agencies, water treatment plants, sewage treatment plants, etc. 73 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 13 EXISTING CONTRACTS, ENCUMBRANCES AND TRANSMISSION OWNERSHIP RIGHTS [Sections 9.1.1 and 9.2.3] Existing Contract or Encumbrance South of Tesla Principles (SOTP) between PG&E and TANC (PG&E # 143) NCPA System Transmission Ownership Rights in the CAISO Balancing Authority Area at Balancing Authority Area Interties (and Related Contracts) Plumas-Sierra Rural Electric Cooperative Transmission Ownership Rights up to Marble Substation intertie (as described in the CAIS©’s Interconnected Control Area Operating Agreement with Sierra Pacific Power Co. for the Marble Substation Intertie) COTP Terminus (as described in the CAISO-SMUD I ntercon nected Control Area Operating Agreement) Amount (MW) 96.639~ (81 + 15,639) Amount (MW) 25** 383 North to South* (279 + 104) 292 South to North* (213 + 79) Scheduling To PG&E 30 min prior to the start of the active hour Scheduling N/A N/A Timelines To CAISO In accordance with the CAISOTariff Timelines To CAISO 30 min prior to the start of the active hour 30 min prior to tile start of the active hour *The amount of MSS Members Existing Contracts and Encumbrances, and Transmission Ownership Rights, as reflected in Schedule 13, aggregates the MSSAA Member’s and SVP’s COTP and SOTP rights. Such COTP and SOTP amounts are subject to interim adjustment in accordance with the Settlement Agreement. Interim adjustments shall not require amendment to this Agreement; provided, 74 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION however, permanent changes to these amounts will be deemed an amendment to this Agreement and shall be given affect in accordance with the Settlement Agreement. The Agreement COTP Terminus Transmission Ownership Rights amounts are contingent upon the direction of the transaction and the California Oregon Intertie rating. The SOTP amounts are contingent upon the availability of unused transmission service rights as further described in the Path 15 Operating Instructions (Appendix B, Transmission Control Agreement, as approved in Docket ER99-1770 and as may be amended or superseded). **The actual transfer capacity of the Marble Intertie is 25 MW, but due to constraints on the Summit Branch Group, the Nomogram (CAISO Procedure: T-154F) limits the actual transfer capacity to equal: 1) Spring (April through May) 15 MW; 2) Summer (June through October 7 MW; and 3) Winter (November th.rough March) 11.5 MW. Note: Details regarding the agreed upon scheduling provisions for each Existing Contract or Encumbrance are described in the Settlement Agreement. 75 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 14 GENERATING UNITS AND PARTICIPATING LOADS [Section 3.3.3, 3.3.4, 7.1.1, 7.1.2, 8.2.1, 8.2.2, 10.1, 10.1.1, 10.1.2, 11.1 and 12.9] NCPA has identified in the attached tables all of the individual Generating Units and Participating Loads that it or the MSS Members own or control on NCPA’s System, together with certain information required by the CAISO. 76 Z © <n," 0 i zt zi i zi zl zi izi zi zi i zizi iz z!zi i ziz!zi zlzizi i zi ! zlzlzi zuJ © 0 p- z u~ 0 < © 0 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Schedule 14 Section 2: Lodi Gas Turbine Additional Limitations based on Generation Levels Gross Generation (MW) 22.2 25 26 27 28 Daily Operating Hours ll 10.7 10.3 9.9 9.5 80 zLO 0 0 Z < Z Z ~ W 0 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 14 Section 2: Limitations Northern California Power Agency Geothermal Operating Plan (4) Geothermal Unit 1 2 3 4 Total Daily Max (1) Operating Cap (MWC) 32 " 137 Daily Min Operating Cap (MWG) 35 35 20 (2) 20 (2) 110 Annual Avg Capacity (MWG) 34 34 30 34 132-134 (3) (0 Daily Max Generation varies as steam field conditions change (2) Single unit operation at minimum Plant 2 load of 20 MW (3) Annual target range set by changes in plant, steamfield, availability factor and market conditions (4) Values indicated are applicable.at the time of revision of this MSS Schedule 14. Stated values may vary over time due to natural changes in the steam field conditions that cannot be precisely predicted or forecasted. Values will be revised as necessary upon subsequent revisions to this MSS Schedule 14. 83 CAL~FO~{N[A I50 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 15 METERING OBLIGATIONS [Section 11.2 and 11.3] Obligations and Riqhts of NCPA 1.0 Submission of Meter Data through the CAISO’s Revenue Meter Data Acquisition and Processing System ("RMDAPS"). NCPA agrees to make available to the CAISO through OMAR, or the successor system, its Meter Data in accordance with the CAISO Tariff. The CAISO’s requirements regard.ing the frequency with which it requires Meter Data to be made available to it through OMAR by NCPA are referred to in the CAISO Tariff and the Business Practice Manual for Metering. 1.1 Meter Information. NCPA shall provide in the format prescribed by Schedule 15.1 the required information with respect to all of its meters used to provide Meter Data to the CAISO. NCPA must immediately notify the CAISO of any changes to the information provided to the CAISQ in accordance with this Section and provide the CAISO with any information in relation to such change as. reasonably requested by the CAISO. NCPA shall have the right to modify Schedule 15.1, although such modification shall not constitute an amendment to this Agreement. 1.2 Transformer and Line Loss Correction Factor. If NCPA uses low voltage side metering, it shall use the CAISO approved Transformer and Line Loss Correction Factor referred to in the CAISO Tariff and the Business Practice Manual for Metering. 1.3 Rights to Access Metering Facilities. NCPA shall use its best efforts to procure any rights necessary for the CAISO to access all Metering Facilities of MSS Members to fulfill its obligations under the CAISO Tariff, and its obligations under this Agreement. If, after using its best efforts, NCPA is unable to provide the CAISO with such access rights, NCPA shall ensure that one of its employees is an CAISO Authorized Inspector and such employee undertakes, at the CAIS©’s request, the certification, testing, inspection and/or auditing of those Metering Facilities in accordance with the procedures established pursuant to the CAIS© Tariff and the Business Practice Manual for Metering, including the requirement to complete and provide to the CAISO al! necessary documentation. The CAISO acknowledges that it will not be prevented from fulfilling its obligations under the CAISO Tariff or this Agreement by reason of the fact that it is provided with escorted access to the Metering Facilities of NCPA. 84 ~ CALIFORNIA I~;O NCPA MSS AGGREGATOR AGREEMENT 1.4 DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Security and Validation Procedures. The security measures and the validation, editing, and estimation procedures that the CAIS© shall apply to Meter Data made available to the CAIS© by NCPA shall be as referred to in the CAISO Tariff and the Business Practice Manual for Metering. 1.5 Authorized Users. In addition to the persons referred to in the CAISO Tariff, including NCPA and the relevant Scheduling Coordinator, as being entitled to access Meter Data on RMDAPS, NCPA may set forth in Schedule 15.2 of this Agreement any additional authorized users that shall be entitled to access NCPA’s Settlement Quality Meter Data held by the CAISO. NCPA shall include in Schedule 15.2 as authorized users the relevant UDCs and TOs. The CAISO shall provide the authorized users with any password or other information necessary to access NCPA’s Settlement Quality Meter Data held by the CAIS© on RMDAPS. Any amendment or addition to Schedule 15.2 shall not constitute an amendment to this Agreement. 1.6 Certification, Inspection, and Auditing of Meters. NCPA shall be responsible for all reasonable costs incurred by the CAISO or a CAISO Authorized Inspector in connection with them carrying out the certification, inspection, testing or auditing of the meters identified in Schedule15.1 from which NCPA provides Meter Data to the CAISO. The CAISO or CAISO Authorized Inspector shall furnish NCPA, upon request, an itemized bill for such costs. Obligations and Riqhts of the CAISO 2.0 Direct Polling of RMDAPS. The CAISO shall allow the Scheduling Coordinator representing NCPA and all authorized users to directly poll ©MAR for the Meter Data relating to NCPA in accordance with the procedures referred to in the CAISO Tariff and the Business Practice Manual for Metering. 2.1 CAISO as a Third-Party Beneficiary. The CAISO shall be a third-party beneficiary to any future agreement between NCPA and any other party relating to the Metering Facilities of NCPA for the purpose of granting the CAISO access to any relevant information, records and facilities as needed by the CAISO to fulfill its obligations under the CAISO Tariff and its obligations under this Agreement. 2.2 Remote and Local Access to Metering Data. The CAISO shall provide NCPA any password or other requirements necessary for NCPA to access its Meter Data remotely or locally at the meter. Calculation of NCPA Settlement Quality Meter Data 85 ~ CAI.I[~OI~NIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION The calculation of NCPA’s Settlement Quality Meter Data ("SQMD") shall be made in accordance with a calculation procedure that is mutually agreed by the Parties, which calculation procedure will generally be as follows: NCPA SQMD (Gross MSS Demand) = Settlement Quality Meter Data at the Points of MSS Interconnection plus Metered Generation from Internal Generating Units. In order to determine the quantity of Gross MSS Demand that is served by TOR or ETC deliveries, and in turn will not be subject to congestion costs resulting from the CAISO LMP calculation, the quantity of Gross MSS Demand that is served by TOR or ETC deliveries must be identified for settlement purposes. The quantity of Gross MSS Demand that is served by TOR or ETC deliveries will be scheduled at one of the NCPA or SVP custom LAPs, as described below, which will be used to identify the quantity of Gross MSS Demand that is served by TOR or ETC deliveries. NCPA will calculate and supply to the CAISO, using OMAR recorder IDs, the metered values associated with the Gross MSS Demand served at the SVP Custom LAP, Plumas Custom LAP, and SOTP Custom LAP by TOR and ETC deliveries. NCPA and SVP Custom TOR / ETC LAPs SVP Custom LAP =Metered deliveries at the SVP Custom LAP, which was created for the purpose of settling Gross MSS Demand associated with TOR and ETC deliveries to the SVP City Gate, is separated from other Gross MSS Demand for the purpose of settling congestion costs. Plumas Custom LAP =Metered deliveries at the Plumas Custom LAP, which was created for the purpose of settling Gross MSS Demand associated with TOR and ETC deliveries to Plumas Sierra REC, is separated from other Gross MSS Demand for the purpose of settling congestion costs. SOTP Custom LAP =Metered deliveries at the SOTP Custom LAP, which was created for the purpose of settling Gross MSS Demand associated with TOR and ETC deliveries to the MSSAA Members with SOTP Entitlement, as further described in Schedule 13, is separated from other Gross MSS Demand for the purpose of settling congestion costs. 86 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION This calculation will be done on an aggregated basis, by Demand zone, consistent with the level of aggregation of the Schedules, provided in the form of a Bid, which will be submitted to the CAISO. The Load Distribution Factors, which are used to disaggregate the aggregated scheduled and metered information, are developed by the CAISO. 87 lt~ CALII=ORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 15.1 METER INFORMATION Location Alameda CT 1, Unit 1 Alameda CT 1, Unit 2 Geothermal Plant 1 (Unit 1) Geothermal Plant 2 (Unit 3) Hydro Bellota 1 Hydro Bellota 2 Hydro New Spicer Meadows Lodi CT1 Lodi STIG Biggs 12kV Biggs 60kV (Main) Gridley, City of Healdsburg, City of Lodi #1 Industrial Lodi #2 Industrial Lodi White Slough StJg Lompoc #1 115kV Lompoc #2 115kV Oakland Station C Oakland Station J Palo Alto Colorado Line #1 Palo Alto Colorado Line #2 Palo Alto Colorado Line #3 Palo Alto Municipality Yard Plumas Quincy Sub. Marble Substation Ukiah - Babcock Lake Mendocino Hydro NCPA-Oakl Port of Oakland Harbor Port of Oakland Army Base2 Street Address 2900 Main Street 2900 Main Street 11785 Socrates Mine Road 11785 Socrates Mine Road 24400 Flood Road 24400 Flood Road Cabbage Patch Substation 2131 W Turner Road 12745 N. Thornton Road 2901 7th Street 1 lth & Dakota Ave 52 East Gridley Road 710 S. Fitch Mountain Road 1230 E. Thurman Street 1230 E. Thurman Street 12751 N. Thornton Road 1110 N D Street 1110 N. D Street 710 2nd & Grove Street Collisium & 50th Ave 1040 Colorado Avenue 1040 Colorado Avenue 1040 Colorado Avenue 3201 East Bayshore Road 2468 E. Main Street Marble Lane & A23 Street 700 Babcock Lane Lake Mendocino 9250 Earhart Road meter id 5910078 591OO79 5910081 591OO83 5910093 5910094 5910295 5910074 5910306 5839002 5839001 5821501 5840001 5840505 5840507 591O457 5841001 5841002 5839501 5839503 5827501 5827502 5827503 5910604 5811501 591O514 and 5910515 5841501 5841502 5910396 and 5910397 City, State, Zip Alameda, CA 94501 Alameda, CA 94501 Middletown, CA 95461 Middletown, CA 95461 Linden, CA 95236-9429 Linden, CA 95236-9429 Hwy 4 Lodi, CA 95242 Lodi, CA 95242 Biggs, CA Biggs, CA Gridley, CA 95948-2604 Healdsburg, CA 95448 Lodi, CA 95240 Lodi, CA 95240 Lodi, CA 95242 Lompoc, CA 93436-6912 Lompoc, CA 93436-6912 Oakland, CA, 94607 Oakland, CA 94601 Palo Alto, CA 94303-3808 Palo Alto, CA 94303-3808 Palo Alto, CA 94303-3808 Palo Alto, CA Quincy, CA 95971 Sattley, CA Ukiah, CA 95482 Ukiah, CA 95482 Oakland, CA, 94621 Owner NCPA NCPA NCPA NCPA NCPA NCPA NCPA NCPA NCPA Western Western Western Western Western Western NCPA Western Western Western Western Western Western Western Palo Alto Western SPPG Western NCPA NCPA 7th Street and Maritime Oakland, CA NCPA 5910399 Street and Western 7th Street and Maritime Oakland, CA NCPA 5833501 Street and Western 2 Meters for the Army Base will only be read if the Army Base is incorporated into Port of Oakland Load. 88 NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 15.2 ACCESS TO METER DATA AND AUTHORIZED USERS NCPA shall provide in Schedule15.2 a list of all authorized users of NCPA’s Settlement Quality Meter Data and any restrictions or limitations placed on them. Authorized Users Pacific Gas and Electric Company 89 ~ I~AL~FOI~N~ ]SO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 16 TRANSMISSION RELIABILITY CRITERIA [Section 8.1.3 & 12.4] For transmission reliability, NCPA and the MSS Members shall abide by all NERC and WECC Planning Criteria and the following: Power Flow Assessment: Criteria Contingencies Thermal 3 Voltage 4 Generating unit 1 A/R A/R Transmission line 1 A/R A/R Transformer 1 A/R 5 A/R 5 Overlapping 2 A!R A/R 1 All single contingency outages (i.e. generating unit, transmission line or transformer) will be simulated on participating transmission owners’ local area systems. 2 Key generating unit out, system readjusted, followed by a line outage. 3 Applicable Rating - Based on CAISO Transmission Register or facility upgrade plans. 4 Applicable Rating - CAISO Grid Planning Criteria or facility owner criteria as appropriate. 5 Based on judgment of CAISO and facility owner, a thermal or voltage criterion violation resulting from a transformer outage may not be cause for Reliability Must-Run Generation solution if the violation is considered marginal (e.g. acceptable loss of life or low voltage), otherwise (e.g. unacceptable loss of life or voltage collapse) a Reliability Must-Run Generation solution would be indicated. Post Transient Load Flow Assessment: Contingencies Reactive Margin Criteria 2 Selected 1 A/R If power flow results indicate significant low voltages for a given power flow contingency, simulate that outage using the post transient load flow program. The post-transient assessment will develop appropriate Q/V and/or PN curves. 2 Applicable Rating - positive margin based on 105% of 1 in 2 year load forecast. 90 CALIFORNIA ISO NCPA MSS AGG REGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Stability Assessment: Contingencies Selected 1 2 Stability Criteria 2 A/R If power flow or post transient study results indicate significant low voltages or marginal reactive margin for a given contingency, simulate that outage using the dynamic stability program. Applicable Rating - CAISO Grid Planning Criteria or facility owner criteria as appropriate. 91 CALIFORNIA IS O NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 17 NOTICES [Section 18.1] NCPA Name of Primary Representative: Title: Address: City/StatelZip Code: Email Address: Phone: Fax No: Matthew Foskett Supervisor, Power Contracts and Interconnection Affairs 651 Commerce Drive Roseville CA 95678 matt.foskett@ncpa.com (916) 781 -4217 (916) 781 - 4252 Name of Alternative Representative: Title: Address: City/State/Zip Code: Email Address: Phone: Fax No: Dave Dockham Assistant General Manager- Power Management 651 Commerce Drive Roseville CA 95678 dave.dockham@ncpa.com (916) 781 - 4256 (916) 781 - 4252 92 ~ CALIFOI~NIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION CAISO Name of Primary Representative: Title: Address: City/State/Zip Code: Email Address: Phone: Fax No: Roni L. Reese Senior Contracts Analyst 151 Blue Ravine Road Folsom, CA 95630 rreese@caiso.com (916) 608-7027 (916) 608-7292 Name of Alternative Representative: Title: Address: City/State/Zip Code: Email Address: Phone: Fax No: Philip D. Pettingill Manager, Infrastructure Policy & Contracts 151 Blue Ravine Road Folsom, CA 95630 ppettingill@caiso.com (916) 608-7241 (916) 608-7292 93 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION SCHEDULE 18 MSS MEMBERS [Section 1.2] MSSAA Members Alameda Power & Telecom City of Biggs City of Gridley City of Healdsburg City of Lodi City of Lompoc City of Palo Alto City of Ukiah Plumas-Sierra Rural Electric Cooperative Port of Oakland (The Port of Oakland’s Oakland International Airport Service Area, the Port of Oakland Harbor Service Area, and the Port of Oakland Army Base) SVP City of Santa Clara ’Silicon Valley Power) 94 CALIFORNIA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Schedule 19 MSSA Load Following Deviation Energy Formula [Section 12.12] All references in the MSSA Load Following Deviation Energy Formula to Scheduled MSS Demand and Metered MSS Demand includes all MSS Demand, both with a delivery point of the NCPA MSS LAP, and any Demand with a delivery point of one of the NCPA or SVP custom LAPs used to account for load served by ETC or TOR deliveries. Each of the NCPA and SVP custom LAPs are further described in Schedule 15 of this Agreement. The MSSA Load Following Deviation Energy Formula may be updated in the future as operational experience is gained, and necessary refinements are indentified. Only those modifications to this Schedule 19 which are mutually acceptable to both NCPA and CAISO will be incorporated in to the MSSA Load Following Deviation Energy Formula, but any modification to Schedule 19 that may reflect a change in resources utilized by NCPA to serve MSS Demand will be incorporated in an expedited manner, and will not be arbitrarily withheld. Load Following MSS Participation in Integrated Forward Market NCPA, acting as MSS Aggregator, can bid a combination of resources that result in final Schedules that are greater or less than the amount of Energy required to balance its Demand obligations in the Day-Ahead market. The resulting difference represents the amount of Energy, which can be positive for a sale or negative for a purchase, that is considered sold or purchased with the CAISO in the Day-Ahead Integrated Forward Market. The resulting sale or purchase is obligated to be delivered to or f~om the CAISO in real-time. The following is a description of the formula used to derive this value: DA CAISO Sale = Where: DA CAISO Sale must be calculated as: Sum of Day-Ahead Final Market Energy Schedule for MSSA Internal Generation * (1- Fixed Loss Factor ) + Sum of Day-Ahead Final Market Energy Schedule for MSS Internal Generation -Sum of Day-Ahead Scheduled MSS Demand + Sum of Day-Ahead Preferred NCPA MSS Trade DA Preferred NCPA MSS Trade =DA Preferred NCPA MSS Trade must be calculated as: Sum of Day-Ahead Preferred Import Energy to 95 ~ CALIt:ORNIA ISO NCPA MSS AGGREGATOR AGREEMENT Where: DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION the MSS Aggregation * (1- Fixed Loss Factor) + Sum of Day-Ahead Inter-SC Trade in to the MSS Aggregation + Sum of MSSA External Generation + Sum of Day-Ahead Preferred Bilateral Trade in to the MSS Aggregation - Sum of Day-Ahead Preferred Export Energy out of the MSS Aggregation - Sum of Day-Ahead Inter-SC Trade out of the MSS Aggregation -Sum of MSSA External Demand - Sum of Day-Ahead Preferred Bilateral Trade out of the MSS Aggregation MSSA Internal Generation means generation that is located outside the geographic boundary of a MSS but is contained.within the MSS Aggregation. MSS Internal Generation means generation located either behind a City Gate Meter or contained within the geographic boundary of a MSS. City Gate Meter means a physical or logical meter(s) that records all power usage by a MSS located at the Points of MSS Interconnection. Each of the MSS Member City Gate Meter(s) is listed in Schedule 1. Fixed Loss Factor means the loss factor used to estimate the actual losses. This factor is negotiated between NCPA and the CAIS©, which is currently set at two percent (2%). Day-Ahead Scheduled MSS Demand means the Load Self-Scheduled as submitted by NCPA, prior to any Day-Ahead adjustments applied by the CAISO market software. MSS External Generation means the sum of all Scheduled Generation in the Day-Ahead Market using the NCPA SCID that is not in the MSS Aggregation. MSSA External Demand means the sum of all Scheduled Demand in the Day-Ahead Market using the NCPA SCID that is not in the MSS Aggregation. Day-Ahead Preferred Bilateral Trades in to and out of the MSS Aggregation are trades that are arranged by contract with a Third Party in the Day-Ahead time-frame and that are not Scheduled with the CAISO as an Inter-SC Trade. 96 CALIFORNIA IS0 NCPA MSS AGGREGATOR AGREEM ENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION Day-Ahead Preferred Import Energy, Day-Ahead Preferred Export Energy, and Day-Ahead Inter-SC Trades in to and out of the MSS Aggregation are as submitted Day-Ahead to the CAISO. DA Preferred NCPA MSS Trade will be calculated by NCPA and provided to the CAISO. The CAISO will use this information in combination with the other data referenced in the DA CAISO Sale equation to calculate the DA CAISO Sale quantity. DA Preferred NCPA MSS Trade is referred to as preferred because all CAISO Scheduled values are based on the schedules and Bids as submitted by NCPA in to the Integrated Forward Market. Both DA CAISO Sale and DA Preferred NCPA MSS Trade are based on pre- schedules and are hourly values. The CAISO can request that DA Preferred NCPA MSS Trade be reported in MW’s for the hour or in MWh on a 10-minute basis. The DA CAISO Sale quantity is calculated by CAISO. MSS Load Following Deviation Energy Formula (DOPD) The Deviation Energy ("DOPD") represents the MSS Aggregation Imbalance Energy adjusted for Day-Ahead Sales or Purchases, as calculated above, and MSSA expected Instructed Imbalance Energy and Regulation Energy. MSSA expected Instructed Imbalance Energy is an amount calculated by the CAISO that represents the Energy dispatched by the CAISO to the MSSA that is required to be provided by the MSSA. MSSA expected Instructed Imbalance Energy includes Energy from Energy Bids (including those associated with Spinning Reserve and Non-Spinning Reserve), Real-Time Energy from RMR Units, and Exceptional Dispatch Energy. MSSA expected Instructed Imbalance Energy does not include energy associated with Load following instructions. Deviation Energy (DOPD) =Deviation Energy must be calculated as: -Metered MSS Gross Demand +Sum of Metered MSSA Internal Generation * (1 - Fixed Loss Factor) + Sum of Metered MSS Internal Generation + RT NCPA MSS Trade + Sum of Regulation Down Energy -Sum of Instructed Imbalance Energy -Sum of Regulation Up Energy -DA CAISO Sale Where: RT NCPA MSS Trade =RT NCPA MSS Trade must be calculated as: + Sum of Final Imports in to the MSS Aggregation * (1 - Fixed Loss Factor) 97 1~ CALII:OR]/IA ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION + Sum of Inter-SC Trades in to the MSS Aggregation + Sum of Bilateral Trades in to the MSS Aggregation + Sum of MSSA External Generation + Real-Time Grizzly Delivery -Sum of Final Exports out of the MSS Aggregation - Sum of Inter-SC Trades out of the MSS Aggregation - Sum of Bilateral Trade out of the MSS Aggregation - Sum of MSSA External Demand Where: RT NCPA MSS Trade means the amount of energy Scheduled and or delivered between the MSS Aggregation and the CAISO Balancing Authority based on the transactions which are active in Real-Time. Metered MSS Gross Demand is the result of a logical meter calculation that adds Metered MSS Internal Generation back in to the Metered Load. Fixed Loss Factor means the loss factor used to estimate actual losses. This factor is negotiated between NCPA and the CAISO, which is currently set at two percent (2%). Instructed Imbalance Energy is expected energy associated with those ADS instruction service types that represent a requirement for the delivery of energy to the CAISO that is incremental (or decremental) to the MSSA’s Load-Following needs. The equation reflected above assumes that ADS will deliver instructions that will account for all differences between the Day-Ahead Schedule and the Real-Time target of the unit, in a way that accurately accounts for any Load-Following energy, and differentiates that from CAISO Instructed Imbalance Energy. Regulation Energy is the integrated expected energy which is calculated and provided in Real-Time due to CAISO Regulation Up and Regulation Down signals. Final Imports and Exports in to and out of the MSS Aggregation are as Scheduled Day-Ahead or in HASP, or as Scheduled up to 30-minutes before the active hour pursuant to ETC and TOR scheduling rights as expressed in Schedule 13, and includes all operational cuts. Inter-SC Trades in to and out of the MSS Aggregation are as Scheduled Day-Ahead or in HASP. Bilateral Trades are trades that are arranged by contract with a Third Party in the Day-Ahead or HASP time-frame that are not Scheduled with the CAISO as an Inter-SC Trade. 98 ~ CA:LI]~OB.N[A ISO NCPA MSS AGGREGATOR AGREEMENT DRAFT MSS AGREEMENT TO ALIGN WITH MRTU IMPLEMENTATION MSSA External Generation and MSSA External Demand are Day-Ahead scheduled values only, as changes to these Schedules after the Day- Ahead market cannot be used to balance Gross MSS Demand. Real-Time Grizzly Delivery means the energy deliveries arranged after the close of HASP, but in accordance with the Grizzly Development and Mokelumne Settlement Agreement. RT NCPA MSS Trade is calculated by NCPA and provided to the CAISO, and will be used by the CAISO in combination with the other data described in the Deviation Energy equation above to calculate Deviation Energy. 99