ex10_39-4.htm


    
      

    

    Exhibit
10.39.4

    
      


      AMENDMENT
NUMBER THREE

      TO
THE

      NIKISKI
COGENERATION PLANT SYSTEM USE AND DISPATCH AGREEMENT

      


      This
AMENDMENT NUMBER THREE is entered into by Homer Electric Association, Inc.
(“HEA”) and Chugach Electric Association, Inc. (“Chugach”) on this 31st day of July,
2008.

      


      WHEREAS,
HEA and Chugach are currently operating under the February 9, 1999, Nikiski
Cogeneration Plant System Use and Dispatch Agreement and the two amendments
thereto (hereinafter collectively referred to as “Dispatch Agreement”) entered
into by Alaska Electric Generation & Transmission, Inc. (“AEG&T”) and
Chugach;

      


      WHEREAS,
on or about June 30, 2003, AEG&T transferred to Alaska Electric & Energy
Cooperative, Inc. (“AEEC”), a single member cooperative of which HEA is the sole
member, a substantial portion of AEG&T’s assets including the Nikiski
Cogeneration Plant;

      


      WHEREAS,
on or about June 30, 2003, AEEC assumed AEG&T’s obligations under paragraphs
7.8 (c), 7.9(a), 7.9(b), 7.10 and 9.2(b) of the Dispatch Agreement;

      


      WHEREAS,
on or about June 30, 2003, AEG&T assigned all of its rights, interest, and
duties in the Dispatch Agreement to HEA, except as provided above;

       

      WHEREAS,
the Dispatch Agreement contains an “all requirements” provision which obligates
HEA to purchase its residual energy requirements exclusively from
Chugach;

      


      WHEREAS,
in response to considerable member interest in sustainable natural alternative
energy, HEA is in the process of developing and seeking approval from the
Regulatory Commission of Alaska (“Commission”) for a Sustainable Natural
Alternative Power (“SNAP”) Program;

       

      WHEREAS,
HEA’s SNAP Program will connect members who have developed alternative energy
generation sources with individuals or entities who voluntarily contribute to
the development of alternative energy sources;

       

      WHEREAS,
under the SNAP Program, HEA will purchase energy generated by “SNAP Projects”
which are member-owned projects producing energy from facilities using wind,
solar, geothermal, biomass, or water resources, with a capacity of 25 kW or
less, and located with HEA’s service territory;

       

       

      Amendment Number Three to Dispatch Agreement

      
        
          
          

        

        
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      WHEREAS,
the “all requirements” provision in Section 7.10 of the Dispatch Agreement may
currently prevent HEA from purchasing energy generated by SNAP Projects;
and

       

      WHEREAS,
Chugach does not want the Dispatch Agreement to prevent HEA from proceeding with
its SNAP program.

       

      NOW
THEREFORE, for good and valuable consideration, which is hereby expressly
acknowledged by the parties, Chugach and HEA hereby amend Section 7.10 of the
Dispatch Agreement to read:

       

      
        
          	
                  7.10

                	
                  Purchase of
      Power:   In addition to its 350,000 MWh purchase
      obligation under the Chugach Wholesale Power Agreement, AEG&T will
      purchase from Chugach in each calendar year after the Date of Commercial
      Operation a quantity of energy (MWh) equal to HEA’s residual energy (MWh)
      requirements less the quantity of energy (MWh) received by AEG&T as
      HEA’s allocated share under the Bradley Lake Hydroelectric Project
      Agreement for the Sale and Purchase of Electric Power and less the
      quantity of energy (MWh) generated for AEG&T Use; provided, that the
      quantity of energy which AEG&T shall be committed to purchase pursuant
      to this provision for its residual energy requirements shall not exceed
      320,000 MWh per year.  AEG&T’s purchase obligation under
      this provision shall commence on the Date of Commercial
      Operation.  Residual energy is that energy used by HEA which is
      above the 350,000 MWh purchase obligation under the Chugach Wholesale
      Power Agreement but does not include any energy supplied from capacity
      used to supply demand in excess of 73 MW on the Chugach system or energy
      purchased by HEA from not more than one (1) MW of installed capacity
      pursuant to its Sustainable Natural Alternative Power (SNAP)
      Program.  All other rights and obligations of the parties under
      the Chugach Wholesale Power Agreement remain in force, including the sale
      and purchase obligation described in Section 3.4 of this
      Agreement.

                


        

      

       

      IN
WITNESS WHEREOF, the parties have executed this Amendment Number Three on the
day and year first written above.

       

      


      CHUGACH
ELECTRIC COOPERATIVE, INC.

      


      /s/ Lee D. Thibert
(For)

      Bradley
Evans

      CEO

      


      


      HOMER
ELECTRIC ASSOCIATION, INC.

      


      /s/ Bradley P.
Janorschke

      Bradley
P. Janorschke

      General
Manager

       

       

    

    Amendment Number Three to Dispatch Agreement

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