EXECUTION COPY
OPERATING AND MAINTENANCE AGREEMENT
by and among
WISCONSIN ELECTRIC POWER COMPANY,
MADISON GAS AND ELECTRIC COMPANY, AND
WISCONSIN PUBLIC POWER INC.,
AS LESSEE/OWNER PARTIES
AND
WISCONSIN ELECTRIC POWER COMPANY, AS OPERATING AGENT
FOR THE
ELM ROAD GENERATING STATION UNIT 1
Dated as of December 17, 2004
ARTICLE I RULES OF INTERPRETATIONS; DEFINITIONS
2
SECTION 1.1
RULES OF INTERPRETATION.
2
SECTION 1.2
DEFINITIONS.
3
ARTICLE II OPERATING AGENT
13
SECTION 2.1
APPOINTMENT OF OPERATING AGENT.
13
SECTION 2.2
OPERATING AGENT'S DUTIES AND RESPONSIBILITIES.
14
SECTION 2.3
EMERGENCIES.
17
SECTION 2.4
CONTRACTS.
17
SECTION 2.5
STANDARDS OF CONDUCT GOVERNING OPERATING AGENT'S ACTIONS.
18
SECTION 2.6
COOPERATION WITH OPERATING AGENT.
19
SECTION 2.7
CHANGE OF OPERATING AGENT.
19
ARTICLE III OPERATING COMMITTEE
21
SECTION 3.1
ESTABLISHMENT AND NATURE OF OPERATING COMMITTEE.
21
SECTION 3.2
SCOPE OF OPERATING COMMITTEE'S REVIEW AND ADVICE.
23
SECTION 3.3
OPERATING COMMITTEE'S AUTHORITY FOR CERTAIN DECISIONS.
24
SECTION 3.4
SINGLE OPERATING COMMITTEE FOR UNIT 1, UNIT 2 AND COMMON FACILITIES
28
ARTICLE IV PROVISION AND USE OF INFORMATION
28
SECTION 4.1
OPERATING AGENT TO PROVIDE RELEVANT INFORMATION.
28
SECTION 4.2
SPECIFIC INFORMATION REQUIREMENTS.
29
SECTION 4.3
PARTIES' RIGHTS OF ACCESS.
30
SECTION 4.4
AUDITS.
30
ARTICLE V TRANSITION
32
SECTION 5.1
CONTROL DURING AND AFTER TRANSITION PERIOD.
32
SECTION 5.2
DOCUMENTS AND AGREEMENTS.
32
SECTION 5.3
COOPERATION.
32
SECTION 5.4
COSTS INCURRED BY OPERATING AGENT DURING TRANSITION PERIOD.
32
SECTION 5.5
TESTING AND INITIAL START-UP.
33
SECTION 5.6
CALEDONIA PAYMENTS.
33
ARTICLE VI OPERATIONS AND SCHEDULING
33
SECTION 6.1
COMMERCIAL OPERATION.
33
SECTION 6.2
AUXILIARY SERVICES.
33
SECTION 6.3
OPERATION BEYOND NET GENERATING CAPABILITY.
33
SECTION 6.4
ALLOCATION OF CAPACITY.
34
SECTION 6.5
MINIMUM SCHEDULE OBLIGATIONS.
34
SECTION 6.6
GENERATION CONTROL.
34
SECTION 6.7
OPERATING EMERGENCIES.
36
SECTION 6.8
COORDINATION OF MAINTENANCE.
36
SECTION 6.9
METERING.
37
ARTICLE VII COMMON FACILITIES
38
ARTICLE VIII FUEL PROCUREMENT AND DELIVERY
38
SECTION 8.1
COAL SUPPLIES.
38
SECTION 8.2
COAL HANDLING SERVICES.
44
SECTION 8.3
OTHER FUEL SUPPLIES.
44
SECTION 8.4
AFFILIATE CONTRACTS.
44
SECTION 8.5
INFORMATION REGARDING COAL DELIVERED TO THE UNIT.
44
SECTION 8.6
INFORMATION REGARDING COAL DELIVERED TO OTHER WEPCO UNITS.
45
SECTION 8.7
AUDIT RIGHTS REGARDING FUEL-RELATED CONTRACTS.
46
SECTION 8.8
CONFIDENTIALITY.
47
TABLE OF CONTENTS
ARTICLE IX ALLOCATION OF CAPITAL COSTS AND OPERATING COSTS
47
SECTION 9.1
GENERAL PRINCIPLES.
47
SECTION 9.2
COMPUTATION OF THE OPERATING AGENT'S LABOR COSTS.
49
SECTION 9.3
COSTS UNIQUE TO OR ORIGINATING AT ELM ROAD UNIT 1.
50
SECTION 9.4
COSTS ALLOCATED FROM THE COMMON FACILITIES O&M AGREEMENT.
50
SECTION 9.5
COSTS UNIQUE TO WEPCO'S FOSSIL FUEL GENERATING FACILITIES.
51
SECTION 9.6
COSTS RELATING TO WEPCO'S AND WISCONSIN GAS COMPANY'S UTILITY OPERATIONS.
51
SECTION 9.7
OTHER SUPPORT COSTS.
51
SECTION 9.8
MISCELLANEOUS.
52
SECTION 9.9
REIMBURSEMENT RESPONSIBILITY.
53
ARTICLE X PAYMENTS AND BILLINGS
54
SECTION 10.1
BILLING PROCEDURES.
54
SECTION 10.2
OPERATING DEPOSIT.
54
SECTION 10.3
COAL COSTS.
54
SECTION 10.4
EXTRAORDINARY COSTS AND REVENUES.
55
SECTION 10.5
PAYMENT IN EVENT OF DISPUTE.
55
SECTION 10.6
ANNUAL TRUE-UPS.
55
SECTION