Exhibit 10.1

AMENDMENT NUMBER 15
TO THE ARIZONA NUCLEAR POWER PROJECT
PARTICIPATION AGREEMENT
 
1.  
PARTIES:

 
The Parties to this Amendment Number 15 to the Arizona Nuclear Power Project
Participation Agreement, hereinafter referred to as “Amendment Number 15,”
are:  ARIZONA PUBLIC SERVICE COMPANY, a corporation organized and existing under
and by virtue of the laws of the State of Arizona, hereinafter referred to as
“Arizona”; SALT RIVER PROJECT AGRICULTURAL IMPROVEMENT AND POWER DISTRICT, an
agricultural improvement district organized and existing under and by virtue of
the laws of the State of Arizona, hereinafter referred to as “Salt River
Project”; SOUTHERN CALIFORNIA EDISON COMPANY, a corporation organized. and
existing under and by virtue of the laws of the State of California, hereinafter
referred to as “Edison”; PUBLIC SERVICE COMPANY OF NEW MEXICO, a corporation
organized and existing under and by virtue of the laws of the State of New
Mexico, hereinafter referred to as “PNM”; EL PASO ELECTRIC COMPANY, a
corporation organized and existing under and by virtue of the laws of the State
of Texas, hereinafter referred to as “El Paso”; SOUTHERN CALIFORNIA PUBLIC POWER
AUTHORITY, a joint powers agency organized and existing under and by virtue of
the laws of the State of California, doing business in the State of Arizona as
SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY ASSOCIATION, hereinafter referred to
as “SCPPA”; and DEPARTMENT OF WATER AND POWER OF THE CITY OF LOS ANGELES, a
municipal corporation organized and existing under and by virtue of the laws of
the State of California, hereinafter referred to as “LADWP;” all hereinafter
individually referred to as “Party” and collectively as “Parties.”
 
 
2.  
RECITALS:

 
2.1.  
Arizona, Salt River Project, Edison, PNM, El Paso, SCPPA and LADWP are parties
to a certain agreement entitled Arizona Nuclear Power Project Participation
Agreement, dated as of August 23, 1973, as amended by: Amendment Number 1, dated
as of January 1, 1974; Amendment Number 2, dated as of August 28, 1975;
Amendment Number 3, dated as of July 22, 1976; Amendment Number 4, dated as of
December 15, 1977; Amendment Number 5, dated as of December 5, 1979; Amendment
Number 6, effective as of October 16, 1981; Amendment Number 7, effective as of
April 1, 1982; Amendment Number 8, executed as of September 12, 1983; Amendment
Number 9, executed as of June 12, 1984 Amendment Number 10, executed as of
November 21, 1985; Amendment Number 11, effective January 10, 1987; Amendment
Number 12, effective August 5, 1988; Amendment Number 13, effective June 15,
1991; and, Amendment Number 14, effective June 20, 2000, retroactive to January
1, 1993, hereinafter, as so amended, referred to as the “Participation
Agreement.”

 
2.2.  
Pursuant to and in accordance Section E.11 of Appendix E to the Participation
Agreement, El Paso and PNM filed protests regarding the allocation of certain
overhead expenses of Arizona, and its corporate parent Pinnacle West Capital
Corporation, to the

 
 
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   Arizona Nuclear Power Project Participants, as specified in the Participation
Agreement, Appendix E, (the “Protests”).

 
 
2.3.  
After analysis and consideration of the Protests by the appropriate Palo Verde
Participant committees, the Participants were not able to resolve the Protests
to the satisfaction of all of the Participants.

 
2.4.  
Prior to the call for submission of the Protests to arbitration as specified in
Sections 24 and E.11.2 of the Participation Agreement, the Participants referred
the Protests to higher authority within each of the respective Participants’
organizations in accordance with Section 6.10 of the Participation Agreement.

 
2.5.  
In December 2009 and January 2010, the Participants’ higher authority (i.e. the
Chief Executive Officers, or the positional equivalent) met and conferred in an
attempt to resolve the Protests.  Following these meetings, PNM agreed to
withdraw its protest, and Arizona proposed modifications to certain provisions
of the Participation Agreement, Appendix E, to resolve El Paso’s protest; El
Paso agreed to Arizona’s proposed settlement, and agreed to withdraw its protest
provided that all Participants execute this Amendment No. 15.

 
 
3.  
AGREEMENT:

 
For and in consideration of the premises and the mutual obligations of and
undertakings by the Parties as hereinafter provided in this Amendment Number 15
to the Participation Agreement, the Parties agree as follows.
 
 
4.  
EFFECTIVE DATE:

 
This Amendment Number 15 shall become effective forty-five (45) days after the
date that the Party which last in time executes this Amendment Number 15.  The
amended procedures for allocating costs that are associated with this Amendment
Number 15 shall be applied retroactively to January 1, 2010.
 
 
5.  
DEFINED TERMS:

 
5.1.  
The Capitalized and italicized words and phrases used in this Amendment Number
15 shall have meanings ascribed to them in the Participation Agreement as
amended by this Amendment Number 15.

 
5.2.  
All references to a “Section” or “Sections” in this Amendment Number 15 shall
mean a Section or Sections of the Participation Agreement unless the text
expressly states otherwise.

 
6.  
AMENDMENTS TO THE ARIZONA NUCLEAR POWER PROJECT MADE BY THIS AMENDMENT NUMBER
15:

 
6.1.  
Delete Section E.1.9.

 
 
6.2.  
Delete Section E.2.3.

 
 
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6.3.  
Amend Section E.3.1.4, by deleting the strikethrough text and substituting
therefor the underlined text:

 
A portion of the expenses incurred by the Operating Agent’s System Electric
Operations Department, such portion to be determined by multiplying the total of
such expenses by a ratio, the numerator of which is the total payroll for ANPP
and the denominator of which is the total payroll supervised by the Executive
Vice President, Engineering and Operations the annual total net megawatt-hour
generation of the ANPP (known and referred to as the Palo Verde Nuclear
Generating Station), and the denominator of which is the annual total net
megawatt-hour generation of all Arizona-operated electric generating facilities
plus Arizona megawatt-hour power purchases plus Arizona megawatt-hour
transmission of power for others.  Such expenses shall include, but not be
limited to, the following:
 
6.4.  
Amend Section E.6.1, by deleting the strikethrough text:

 
The Operation and Maintenance A & G Ratio shall be the percentage computed by
dividing (i) the sum of (a) the total amounts charged to FPC Accounts 920 and
921 multiplied by the O & M Ratio computed in accordance with Section E.8
hereof, (b) the total amounts charged to FPC Accounts 923 (except any amounts
directly chargeable to ANPP) and 935 (formerly 932), (c) the product of the
portion of labor charges included within (a) and (b) above multiplied by the
Payroll Tax Ratio computed in accordance with Section E.4 hereof (d) the product
of the labor charges included within (a) and (b) above multiplied by the
Benefits Ratio computed in accordance with Section E.5 hereof, and (e) the
product of the labor charges included within (a) and (b) above multiplied by the
Compensation Insurance Ratio computed in accordance with Section E.7 hereof,
less (f) the one percent (1%) portion of the administrative and general expenses
charged to FPC Accounts 920 and 921 allocable to contract operation and
maintenance by (ii) the direct labor (i.e. total labor less labor charge to
clearing accounts) chargeable to operation and maintenance accounts (exclusive
of A & G), to include O & M labor billed to Participants and the labor portion
of Start-Up and Pre-Operation Costs subject to the Operation and Maintenance A &
G Ratio pursuant to Section L.1.3, and to exclude the labor portion of Start-Up
and Pre-Operation Costs subject to the construction administrative and general
expense percentage of one percent (1%) pursuant to Section L.1.3.
 
 
6.5.  
Amend Section E.6.2, by deleting the strikethrough text and substituting
therefor the underlined text:

 
The following example sets forth the method to be employed by the Operating
Agent to determine the Operation and Maintenance A & G Ratio:
 
EXAMPLE COMPUTATION OF OPERATIONS
 
AND MAINTENANCE A & G RATIO
 
(Based on the Operating Agent’s 1984 Experience)

Labor                                                                                                   Total
 
 
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Administrative and General Salaries
             
charged to FPC Account
920                                                                                                    
$17,408,542 
 
$17,406,779
       
Office Supplies and Expenses
             
charged to FPC Account 921
   
   7,208,084
       
[Line 7] Total
  $17,408,542               $24,614,863
       
Total FPC Accounts 920 and 921,
             
multiplied by O & M Ratio @ 68.48%
$11,921,544
 
$16,856,504
     
     
FPC Account 923
   
      919,166
 
   
FPC Account 932 (presently 935)
1,555,913                   3,127,002
       
[Line 11] Subtotal 
 $13,477,457
 
$20,902,672
       
Payroll Taxes @ 7.126%
   
       960,404
       
Pensions and Benefits @ 13.512%
   
    1,821,074
       
Compensation Insurance @ 0.451%
   
         60,783
       
Less that 1% portion of A & G allocable
             

 to Contract Operation and
Maintenance                                                                                                                                                                                                                                                1,483,314
 
Total administrative and general expenses
             
allocable to operations and maintenance 
 $22,261,619  
 
 $23,744,933
       

 
                           
Labor Base
 
 
Direct labor charged to system operations and
 
maintenance, as further defined in Section
E.6.1                                    
                                                                                                                                                
                                      $148,557,953
 
Less direct labor charged to administrative and
 
general expenses (FPC Accounts 920-931 and 935)                                 
          
                                                                                                                           
                                                 13,160,635
 
Labor
Base                                                                                                                                                                                                                                                     
                                     $135,397,318
 
 
 
Operation and Maintenance
 
A & G Ratio for 1984 $22,261,619 ÷ $135,397,318 = 16.442%
 
Operation and Maintenance
 
A & G Ratio for 1984 $23,744,933 ÷ $135,397,318 = 17.537%
 
 
Note: All labor figures include loading for allowed time.
 
 
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6.6.  
Amend Section E.9.1, by deleting the strikethrough text:

 
The Capital A & G Ratio shall be the percentage computed by dividing (i) the
amounts equal to (A) the sum of (a) the total amounts charged to FPC Accounts
920 and 921 multiplied by the Construction Ratio computed in accordance with
Section E.8 hereof, and (b) the product of the portion of labor charges included
in (a) above multiplied by the sum of the Payroll Tax Ratio, the Benefits Ratio
and the Compensation Insurance Ratio less (B) the one percent (1%) portion of
administrative and general expenses charged to FPC Accounts 920 and 921
allocable to contract construction (including the administrative and general
expenses (i) recovered on Start-Up and Pre-Operation Costs subject to the
construction administrative and general expense percentage of one percent (1%)
pursuant to Section L.1.3, (ii) recovered on ANPP construction expenses, and
(iii) allocable to other contract construction) by (ii) the direct labor in
construction accounts (exclusive of A & G), to include construction labor billed
to Participants, excluding the labor portion of Start-Up and Pre-Operation Costs
subject to the Operation and Maintenance A & G Ratio pursuant to Section L.1.3,
less the labor portion of construction expenses to which the one percent (1%)
portion of administrative and general expenses is applicable, and less the labor
portion of Start-Up and Pre-Operation Costs subject to the construction
administrative and general expense percentage of one percent (1%) pursuant to
Section L.1.3.
 

 
6.7.  
Amend Section E.9.2, by deleting the strikethrough text and substituting
therefor the underlined text:

 
The following example sets forth the method to be employed by the Operating
Agent to determine the Capital A & G Ratio:

EXAMPLE COMPUTATION OF CAPITAL A & G RATIO
 
(Based on the Operating Agent’s 1984 Experience)
 
Labor
   
             Total
       
Administrative and General Salaries
             
charged to FPC Account 920
 $17,408,542
 
   $17,406,779
       
Office Supplies and Expenses
             
charged to FPC Account 921 
 
     7,208,084        
[Line 7] Total
  $17,408,542                         $24,614,863
       
Total FPC Accounts 920 and 921, multiplied
             
[Line 9] by Construction Ratio
             
@ 28.355%  
 $ 4,936,192
 
 $ 6,979,544
       
Payroll Taxes @ 7.126%
   
   351,753
       
Pensions and Benefits @ 13.512% 
   
  666,978
       
Compensation Insurance @ 0.451%
   
  22,262
                       

 
                                                     

 
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Less that 1% portion of A & G allocable
         
to Contract Construction, as further
         

  defined in Section
E.9.1                                                                        
                                                    
                                              
                                                                          
                  3,634,919

     
Total A & G Expense allocable
         
to Construction
 
$ 4,385,618  8,020,537
     
Construction Direct Labor    
 
56,061,726
     
Less the labor portion of Construction Work,
         
Start-Up and Pre-Operation Costs subject
         
to the construction administrative and
         
general expense percentage of one percent (1%) 
 
    13,496,824
     
 Total Construction Direct Labor Base    
 
  $42,564,902
     

 
Capital A & G Ratio for 1984 $4,385,618 ÷ $42,564,902 = 10.303%
 
Capital A & G Ratio for 1984 $8,020,537 ÷ $42,564,902 = 18.843%
 
 
Note: All labor figures include loading for allowed time.
 
 
7. 
EXECUTION BY COUNTERPARTS:

 
This Amendment Number 15 may be executed in any number of counterparts, and upon
execution by all Participants, each executed counterpart shall have the same
force and effect as an original instrument and as if all Participants had signed
the same instrument.  Any signature page of this Amendment Number 15 may be
detached from any counterpart of the Amendment Number 15 without impairing the
legal effect of any signature thereon, and may be attached to another
counterpart of this Amendment Number 15 identical in form hereto but having
attached to it one or more signature pages.
 
[Remainder of page intentionally left blank.  This page is followed by seven
consecutive execution pages.]

 
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8.    SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
ARIZONA PUBLIC SERVICE COMPANY                                               
 
 
 
                               By:  /s/ Donald
Robinson                                                                               
   
Its:  President &
COO                                                                                      
 
Date:  11/29/10                               
                                                                  
STATE OF ARIZONA                        )
) ss.
County of Maricopa                            )
 
On this 29 day of November, 2010, before me, the undersigned Notary Public,
personally appeared Donald Robinson who acknowledged him/herself to be the
President & COO of ARIZONA PUBLIC SERVICE COMPANY, an Arizona corporation, and
that he/she as such officer, being authorized to do, executed the foregoing
instrument for the purposes therein contained by signing the name of the company
by him/herself as such President & COO.
 
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
 
 
/s/ Karen McLoughlin           ____________
Notary Public
My Commission Expires:
 
__10/15/2014_________
 

 
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8.      SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
SALT RIVER PROJECT AGRICULTURAL                                  
IMPROVEMENT AND POWER DISTRICT                                  
 
 
 
By:  /s/ John R. Hoopes         
                                                           
 
Its:  Vice President                                
                                            
 
Date:  6/14/2010                             
                                                    
 
 
 
ATTEST AND COUNTERSIGN:
 
By:  /s/ Terrill A. Lonon                
                                           
 
Its:    Corporate Secretary            
                                           
 
Date:    6/14/10                               
                                           
 
STATE OF ARIZONA                        )
) ss.
County of Maricopa                            )
 
On this 14th day of June, 2010, before me, the undersigned Notary Public,
personally appeared John R. Hoopes who acknowledged him/herself to be the SRP
Vice President of SALT RIVER PROJECT AGRICULTURAL IMPROVEMENT AND POWER
DISTRICT, an Arizona corporation, and that he/she as such officer, being
authorized to do, executed the foregoing instrument for the purposes therein
contained by signing the name of the company by him/herself as such SRP Vice
President.
 
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
/s/ Stephanie K. Reed__________________
Notary Public
My Commission Expires:
__Aug. 5, 2011________

 
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8.      SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
 
SOUTHERN CALIFORNIA EDISON COMPANY  
                       
By:  /s/ Alan Fohrer                                                         
 
Its:  Chairman & Chief Executive Officer                        
 
Date:  September 2,
2010                                                                   

 
 
STATE OF CALIFORNIA                  )
) ss.
County of Los Angeles                      )
 
On this 09.02.2010 before me, Michelle M. Morales, Notary Public, personally
appeared Alan Fohrer who proved to me on the basis of satisfactory evidence to
me to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
 
I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.
 
WITNESS my hand and official seal.
 
 
 
Signature  /s/ Michelle M. Morales____________________
Notary Public
My Commission Expires:
 
___Feb. 17, 2013_______
 

 
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8.        SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
PUBLIC SERVICE COMPANY OF NEW                                
MEXICO                   
                                                                     
 
 
 
By:  /s/ Patrick Themig                                   
 
Its:  VP Generation                                         
 
  Date:  10/4/10                                                  

 
 
STATE OF NEW MEXICO                )
) ss.
County of Bernalillo                            )
 
On this 4th  day of October, 2010, before me, the undersigned Notary Public,
personally appeared Patrick Themig who acknowledged him/herself to be the VP
Generation of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation,
and that he/she as such officer, being authorized to do, executed the foregoing
instrument for the purposes therein contained by signing the name of the company
by him/herself as such VP Generation.
 
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
 
 
/s/ G. Marcella Kercher           ___________
Notary Public
My Commission Expires:
 
__12-17-2011__________

 
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8.      SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
                                                 EL PASO ELECTRIC COMPANY
 
                                                 By:  /s/ David W.
Steven                             
 
                                                 Its:  C.E.O.                                                       
 
                                                 Date:  September 10,
2010                             
 
 
STATE OF TEXAS                              )
) ss.
County of El Paso                                )
 
On this 10 day of September, 2010, before me, the undersigned Notary Public,
personally appeared David W. Stevens who acknowledged him/herself to be the
C.E.O. of EL PASO ELECTRIC COMPANY, a Texas corporation, and that he/she as such
officer, being authorized to do, executed the foregoing instrument for the
purposes therein contained by signing the name of the company by him/herself as
such David W. Stevens.
 
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
 
 
/s/ Valerie J. Pugh_____________________
Notary Public
My Commission Expires:
 
_12-9-2012____________

 
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8.        SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
 
                                                 SOUTHERN CALIFORNIA
PUBLIC                                            
                                                 POWER AUTHORITY, doing business
in                                   
                                                 the State of Arizona as
SOUTHERN                                             
                                                 CALIFORNIA PUBLIC
POWER                                                   
                                                 AUTHORITY
ASSOCIATION                                                       

                                                 By:  /s/ Bill D.
Carnahan                                        
 
                                                 Its:  Executive
Director                                           
 
                                                 Date:  9/28/10                                                          
 
 
 
STATE OF CALIFORNIA                  )
) ss.
County of Los Angeles                      )
 
On this September 28, 2010 before me, Sue Hasseler, a notary public, personally
appeared Bill D. Carnahan who proved to me on the basis of satisfactory evidence
to me to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
 
I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.
 
WITNESS my hand and official seal.
 
 
Signature  /s/ Sue Hasseler_______________________
Notary Public
My Commission Expires:
 
_Jan. 1, 2013__________

 
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8.      SIGNATURE CLAUSE:
 
Each of the signatories below represents that he/she is appropriately authorized
to enter into this Amendment Number 15 on behalf of the Party for which he/she
signs.
 
 
                                                    DEPARTMENT OF WATER
AND                                      
                                                    POWER OF THE CITY OF
LOS                                         
                                                    ANGELES             
                                                                   
 
                                                    By:  /s/ Aram
Benyamin                        
 
                                                    Its:  Sr. Asst. General
Mgr.                                                    
 
                                                    Date:  06/02/10                             
                                           
 
 
 
STATE OF CALIFORNIA                  )
) ss.
County of Los Angeles                      )
 
On this 2nd day of June, 2010, before me, the undersigned Notary Public,
personally appeared Aran Benyamin who acknowledged him/herself to be the Sr.
Asst. Gen. Mgr. of DEPARTMENT OF WATER AND POWER OF THE CITY OF LOS ANGELES, a
California joint powers agency, and that he/she as such officer, being
authorized to do, executed the foregoing instrument for the purposes therein
contained by signing the name of the company by him/herself as such
___________________________________.
 
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
 
 
/s/ Chere D. Lott______________________
Notary Public
My Commission Expires:
 
_Sep. 21, 2012_________

 
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