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Unassociated Document

    EXHIBIT
      10.3

     

    RIVER
      VALLEY FINANCIAL BANK

    SALARY
      CONTINUATION AGREEMENT

    

    THIS
      SALARY CONTINUATION AGREEMENT (this “Agreement”) is adopted this 25th day of
      January, 2007, by and between RIVER VALLEY FINANCIAL BANK, a savings association
      located in Madison, Indiana (the “Bank”), and MATTHEW FORRESTER (the
“Executive”). 

    

    The
      purpose of this Agreement is to provide specified benefits to the Executive,
      a
      member of a select group of management or highly compensated employees who
      contribute materially to the continued growth, development and future business
      success of the Bank. This Agreement shall be unfunded for tax purposes and
      for
      purposes of Title I of the Employee Retirement Income Security Act of 1974
      (“ERISA”), as amended from time to time. 

     

    Article
      1

    Definitions

    

    Whenever
      used in this Agreement, the following words and phrases shall have the meanings
      specified:

     

    
      	
              1.1

            	
              “Accrual
                Balance”
                means the liability that should be accrued by the Bank, under Generally
                Accepted Accounting Principles (“GAAP”), for the Bank’s obligation to the
                Executive under this Agreement, by applying Accounting Principles
                Board
                Opinion Number 12 (“APB 12”) as amended by Statement of Financial
                Accounting Standards Number 106 (“FAS 106”) and the Discount Rate. Any one
                of a variety of amortization methods may be used to determine the
                Accrual
                Balance. However, once chosen, the method must be consistently applied.
                

            

    

    

    
      	
              1.2

            	
              “Beneficiary”
                means each designated person or entity, or the estate of the deceased
                Executive, entitled to any benefits upon the death of the Executive
                pursuant to Article 4.

            

    

    

    
      	
              1.3

            	
              “Beneficiary
                Designation Form”
                means the form established from time to time by the Plan Administrator
                that the Executive completes, signs and returns to the Plan Administrator
                to designate one or more
                Beneficiaries.

            

    

    

    
      	
              1.4

            	
              “Board”
                means the Board of Directors of the Bank as from time to time
                constituted.

            

    

    

    
      	
              1.5

            	
              “Change
                in Control”
                means a change in the ownership or effective control of the Bank,
                or in
                the ownership of a substantial portion of the assets of the Bank,
                as such
                change is defined in Code Section 409A.

            

    

    

    
      	
              1.6

            	
              “Code”
                means the Internal Revenue Code of 1986, as amended, and all regulations
                and

            

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    guidance
      thereunder, including such regulations and guidance as may be promulgated after
      the Effective Date of this Agreement.

    

    
      	
              1.7

            	
              “Disability”
                means the Executive: (i) is unable to engage in any substantial gainful
                activity by reason of any medically determinable physical or mental
                impairment which can be expected to result in death or can be expected
                to
                last for a continuous period of not less than twelve (12) months;
                or (ii)
                is, by reason of any medically determinable physical or mental impairment
                which can be expected to result in death or can be expected to last
                for a
                continuous period of not less than twelve (12) months, receiving
                income
                replacement benefits for a period of not less than three (3) months
                under
                an accident and health plan covering employees or directors of the
                Bank.
                Medical determination of Disability may be made by either the Social
                Security Administration or by the provider of an accident or health
                plan
                covering employees or directors of the Bank, provided that the definition
                of “disability” applied under such insurance program complies with the
                requirements of the preceding sentence. Upon the request of the Plan
                Administrator, the Executive must submit proof to the Plan Administrator
                of the Social Security Administration’s or the provider’s
                determination.

            

    

    

    
      	
              1.8

            	
              “Discount
                Rate”
                means the rate used by the Plan Administrator for determining the
                Accrual
                Balance. The initial Discount Rate is six percent (6%). However,
                the Plan
                Administrator, in its discretion, may adjust the Discount Rate to
                maintain
                the rate within reasonable standards according to GAAP and/or applicable
                bank regulatory guidance.

            

    

    

    
      	
              1.9

            	
              “Early
                Retirement”
                means Separation from Service after Early Retirement Age and before
                Normal
                Retirement Age.

            

    

     

    
      	
              1.10

            	
              “Early
                Retirement Age”
                means the Executive attaining age sixty two
                (62).

            

    

     

    
      	
              1.11

            	
              “Early
                Termination” means
                Separation from Service before Early Retirement Age except when such
                Separation from Service occurs (i) following a Change in Control;
                or (ii)
                due to death, Termination for Cause or
                Disability.

            

    

    

    
      	
              1.12

            	
              “Effective
                Date”
                means January 1, 2007.

            

    

    

    
      	
              1.13

            	
              “Employment
                Agreement”
                means the Employment Agreement between the Bank and the Executive
                effective October 12, 1999, as it may be amended from time to
                time.

            

    

    

    
      	
              1.14

            	
              “Normal
                Retirement Age”
                means the Executive attaining age sixty five
                (65).

            

    

    

    
      	
              1.15

            	
              “Normal
                Retirement Date”
                means the later of Normal Retirement Age or Separation from
                Service.

            

    

     

    
      	
              1.16

            	
              “Plan
                Administrator”
                means the Board or such committee or person as the Board shall
                appoint.

            

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
              1.17

            	
              “Plan
                Year”
                means each twelve (12) month period commencing on January 1 and ending
                on
                December 31 of each year. The initial Plan Year shall commence on
                the
                Effective Date of this Agreement and end on the following December
                31.

            

    

    

    
      	
              1.18

            	
              “Separation
                from Service”
                means the termination of the Executive’s
                employment with
                the Bank for reasons other than death. Whether
                a Separation from Service takes place is determined in accordance
                with the
                requirements of Code Section 409A based on the facts and circumstances
                surrounding the termination of the Executive’s employment and whether the
                Bank and the Executive intended for the Executive to provide significant
                services for the Bank following such termination. A Separation from
                Service will not have occurred if:

            

    

    

     

    
      	 	
              (a)

            	
              the
                Executive continues to provide services as an employee of the Bank
                at an
                annual rate that is twenty percent (20%) or more of the services
                rendered,
                on average, during the immediately preceding three (3) full calendar
                years
                of employment (or, if employed less than three (3) years, such lesser
                period) and the annual remuneration for such services is twenty percent
                (20%) or more of the average annual remuneration earned during the
                final
                three (3) full calendar years of employment (or, if less, such lesser
                period), or

            

    

     

    (b) the
      Executive continues to provide services to the Bank in a capacity other than
      as
      an employee of the Bank at an annual rate that is fifty percent (50%) or more
      of
      the services rendered, on average, during the immediately preceding three (3)
      full calendar years of employment (or if employed less than three (3) years,
      such lesser period) and the annual remuneration for such services is fifty
      percent (50%) or more of the average annual remuneration earned during the
      final
      three (3) full calendar years of employment (or if less, such lesser period).
      

     

    The
      Executive’s employment relationship will be treated as continuing intact while
      the Executive is on military leave, sick leave or other bona fide leave of
      absence if the period of such leave of absence does not exceed six (6) months,
      or if longer, so long as the Executive’s right to reemployment with the Bank is
      provided either by statute or by contract. If the period of leave exceeds six
      (6) months and there is no right to reemployment, a Separation from Service
      will
      be deemed to have occurred as of the first date immediately following such
      six
      (6) month period.

     

    
      	
              1.19

            	
              “Specified
                Employee”
                means a key employee (as defined in Code Section 416(i) without regard
                to
                paragraph 5 thereof) of the Bank if any stock of the Bank or any
                entity
                required to be aggregated with the Bank under Section 414(b) or Section
                414(c) of the Code is publicly traded on an established securities
                market
                or otherwise, as determined by the Plan Administrator based on the
                twelve
                (12) month period ending each December 31 (the “identification period”).
                If the Executive is determined to be a Specified Employee for
                an

            

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    identification
      period, the Executive shall be treated as a Specified Employee for purposes
      of
      this Agreement during the twelve (12) month period that begins on the first
      day
      of the fourth month following the close of the identification
      period.

    

    
      	
              1.20

            	
              “Termination
                for Cause”
                means Separation from Service for the Executive’s personal dishonesty,
                incompetence, willful misconduct, breach of fiduciary duty involving
                personal profit, intentional failure to perform stated duties, willful
                violation of any law, rule or regulation (other than traffic violations
                or
                similar offenses) or final cease and desist order or material breach
                of
                any provision of this Agreement:

            

    

    

    Article
      2

    Distributions
      During Lifetime

    

    
      	
              2.1

            	
              Normal
                Retirement Benefit.
                Upon the Normal Retirement Date, the Bank shall distribute to the
                Executive the benefit described in this Section 2.1 in lieu of any
                other
                benefit under this Article. 

            

    

    
      	 	
              2.1.1

            	
              Amount
                of Benefit.
                The annual benefit under this Section 2.1 is Fifty Thousand Dollars
                ($50,000). 

            

    

    

    
      	 	
              2.1.2

            	
              Distribution
                of Benefit.
                The Bank shall distribute the annual benefit to the Executive in
                twelve
                (12) equal monthly installments commencing on the first day of the
                month
                following Separation from Service. The annual benefit shall be distributed
                to the Executive for fifteen (15)
                years.

            

    

    

    
      	
              2.2

            	
              Early
                Retirement Benefit.
                Upon Separation from Service after Early Retirement Age and before
                Normal
                Retirement Age, the Bank shall distribute to the Executive the benefit
                described in this Section 2.2 in lieu of any other benefit under
                this
                Article. 

            

    

    
      	 	
              2.2.1

            	
              Amount
                of Benefit.
                The benefit under this Section 2.2 is the Accrual Balance determined
                as of
                the end of the month preceding Separation from Service. 

            

    

    

    
      	 	
              2.2.2

            	
              Distribution
                of Benefit.
                The Bank shall distribute the benefit to the Executive in one hundred
                eighty (180) equal monthly installments commencing on the first day
                of the
                month following Separation from
                Service.

            

    

    

    
      	
              2.3

            	
              Early
                Termination Benefit.
                If Early Termination occurs, the Bank shall distribute to the Executive
                the benefit described in this Section 2.3 in lieu of any other benefit
                under this Article.

            

    

    

    
      	 	
              2.3.1
                

            	
              Amount
                of Benefit.
                The benefit under this Section 2.3 is the Accrual Balance determined
                as of
                the end of the month preceding Separation from Service. 

            

    

    

    
      	 	
              2.3.2

            	
              Distribution
                of Benefit.
                The Bank shall distribute the benefit to the Executive in a lump
                sum
                within thirty (30) days following Separation from Service.
                

            

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    
      	
              2.4

            	
              Disability
                Benefit.
                If the Executive experiences a Disability which results in a Separation
                from Service prior to Early Retirement Age, the Bank shall distribute
                to
                the Executive the benefit described in this Section 2.4 in lieu of
                any
                other benefit under this Article.

            

    

    

    
      	 	
              2.4.1

            	
              Amount
                of Benefit.
                The
                benefit under this Section 2.4 is the Accrual Balance determined
                as of the
                end of the month preceding Separation from
                Service.

            

    

    

    
      	 	
              2.4.2

            	
              Distribution
                of Benefit.
                The Bank shall distribute the benefit to the Executive in a lump
                sum
                within thirty (30) days following Separation from
                Service.

            

    

    

    
      	
              2.5

            	
              Change
                in Control Benefit.
                If a Change in Control occurs followed by a Separation from Service,
                the
                Bank shall distribute to the Executive the benefit described in this
                Section 2.5 in lieu of any other benefit under this Article.
                

            

    

     

    
      	 	
              2.5.1

            	
              Amount
                of Benefit.
                The
                benefit under this Section 2.5 is the Normal Retirement Benefit set
                forth
                at Section 2.1.1. 

            

    

    

    
      	 	
              2.5.2

            	
              Distribution
                of Benefit.
                The Bank shall distribute the benefit to the Executive in a lump
                sum
                within thirty (30) days following Separation from Service.
                

            

    

    

    
      	 	
              2.5.3

            	
              280G
                Limits.
                Anything in this Agreement to the contrary notwithstanding, in the
                event
                that the Bank’s independent public accountants determine that any payment
                by the Bank to or for the benefit of the Executive, whether paid
                or
                payable pursuant to the terms of this Agreement or pursuant to any
                other
                agreement, would be non-deductible by the Bank for federal income
                tax
                purposes because of Section 280G of the Code, then the amount payable
                to
                or for the benefit of the Executive pursuant to this Agreement shall
                be
                reduced (but not below zero) to the Reduced Amount. For purposes
                of this
                Section 2.5.3, the “Reduced Amount” shall be the amount which maximizes
                the amount payable without causing the payment to be non-deductible by
                the
                Bank because of Section 280G of the Code.

            

    

    

    
      	
              2.6

            	
              Restriction
                on Commencement of Distributions.
                Notwithstanding any provision of this Agreement to the contrary,
                if the
                Executive is considered a Specified Employee at Separation from Service,
                the provisions of this Section 2.6 shall govern all distributions
                hereunder. Benefit distributions that are made due to a Separation
                from
                Service occurring while the Executive is a Specified Employee shall
                not be
                made during the first six (6) months following Separation from Service.
                Rather, any distribution which would otherwise be paid to the Executive
                during such period shall be accumulated and paid to the Executive
                in a
                lump sum on the first day of the seventh month following the Separation
                from Service. All subsequent distributions shall be paid in the manner
                specified. 

            

    

    

    
      	
              2.7

            	
              Distributions
                Upon Income Inclusion Under Code Section 409A.
                If any amount is required to be included in income by the Executive
                prior
                to receipt due to a failure of
                this

            

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    Agreement
      to meet the requirements of Code Section 409A, the Executive may petition the
      Plan Administrator for a distribution of that portion of the amount the Bank
      has
      accrued with respect to the Bank’s obligations hereunder that is required to be
      included in the Executive’s income. Upon the grant of such a petition, which
      grant shall not be unreasonably withheld, the Bank shall distribute to the
      Executive immediately available funds in an amount equal to the portion of
      the
      amount the Bank has accrued with respect to the Bank’s obligations hereunder
      required to be included in income as a result of the failure of this Agreement
      to meet the requirements of Code Section 409A, within ninety (90) days. Such
      a
      distribution shall affect and reduce the Executive’s benefits to be paid under
      this Agreement.

    

    
      	
              2.8

            	
              Change
                in Form or Timing of Distributions.
                For distribution of benefits under this Article 2, the Executive
                and the
                Bank may, subject to the terms of Section 8.1, amend this Agreement
                to
                delay the timing or change the form of distributions. Any such
                amendment:

            

    

     

    
      	 	
              (a)

            	
              may
                not accelerate the time or schedule of any distribution, except as
                provided in Code Section 409A;

            

    

    
      	 	
              (b)

            	
              must,
                for benefits distributable under Sections 2.1, 2.2, 2.3 and 2.5,
                delay the
                commencement of distributions for a minimum of five (5) years from
                the
                date the first distribution was originally scheduled to be made;
                and

            

    

    
      	 	
              (c)

            	
              must
                take effect not less than twelve (12) months after the amendment
                is
                made.

            

    

    

    Article
      3

    Distribution
      at Death

    

    
      	
              3.1

            	
              Death
                During Active Service.
                If the Executive dies prior to Separation from Service, the Bank
                shall
                distribute to the Beneficiary the benefit described in this Section
                3.1.
                This benefit shall be distributed in lieu of any benefit under Article
                2.

            

    

    

    
      	 	
              3.1.1

            	
              Amount
                of Benefit.
                The benefit under this Section 3.1 is the Accrual Balance determined
                as of
                the end of the month preceding the executive’s death.
                

            

    

    

    
      	 	
              3.1.2

            	
              Distribution
                of Benefit.
                The Bank shall distribute the benefit to the Beneficiary in a lump
                sum
                within thirty (30) days following receipt by the Bank of the Executive’s
                death certificate.

            

    

     

    
      	
              3.2

            	
              Death
                During Distribution of a Benefit.
                If the Executive dies after any benefit distributions have commenced
                under
                this Agreement but before receiving all such distributions, the Bank
                shall
                distribute to the Beneficiary the remaining benefits at the same
                time and
                in the same amounts they would have been distributed to the Executive
                had
                the Executive survived.

            

    

     

    
      	
              3.3

            	
              Death
                After Separation from Service But Before Benefit Distributions
                Commence.
                If
                the Executive is entitled to benefit distributions under this Agreement
                but dies prior to the commencement of said benefit distributions,
                the Bank
                shall distribute to the
                Beneficiary

            

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    the
      same
      benefits to which the Executive was entitled prior to death, except that the
      benefit distributions shall commence within thirty (30) days following receipt
      by the Bank of the Executive’s death certificate.

    

    Article
      4

    Beneficiaries

    

    
      	
              4.1

            	
              In
                General.
                The Executive shall have the right, at any time, to designate a
                Beneficiary to receive any benefit distributions under this Agreement
                upon
                the death of the Executive. The Beneficiary designated under this
                Agreement may be the same as or different from the beneficiary designation
                under any other plan of the Bank in which the Executive participates.
                

            

    

    

    
      	
              4.2

            	
              Designation.
                The Executive shall designate a Beneficiary by completing and signing
                the
                Beneficiary Designation Form and delivering it to the Plan Administrator
                or its designated agent. If the Executive names someone other than
                the
                Executive’s spouse as a Beneficiary, the Plan Administrator may, in its
                sole discretion, determine that spousal consent is required to be
                provided
                in a form designated by the Plan Administrator, executed by the
                Executive’s spouse and returned to the Plan Administrator. The Executive’s
                beneficiary designation shall be deemed automatically revoked if
                the
                Beneficiary predeceases the Executive or if the Executive names a
                spouse
                as Beneficiary and the marriage is subsequently dissolved. The Executive
                shall have the right to change a Beneficiary by completing, signing
                and
                otherwise complying with the terms of the Beneficiary Designation
                Form and
                the Plan Administrator’s rules and procedures. Upon the acceptance by the
                Plan Administrator of a new Beneficiary Designation Form, all Beneficiary
                designations previously filed shall be cancelled. The Plan Administrator
                shall be entitled to rely on the last Beneficiary Designation Form
                filed
                by the Executive and accepted by the Plan Administrator prior to
                the
                Executive’s death.

            

    

    

    
      	
              4.3

            	
              Acknowledgment.
                No designation or change in designation of a Beneficiary shall be
                effective until received, accepted and acknowledged in writing by
                the Plan
                Administrator or its designated
                agent.

            

    

    

    
      	
              4.4

            	
              No
                Beneficiary Designation.
                If the Executive dies without a valid beneficiary designation, or
                if all
                designated Beneficiaries predecease the Executive, then the Executive’s
                spouse shall be the designated Beneficiary. If the Executive has
                no
                surviving spouse, any benefit shall be paid to the personal representative
                of the Executive’s estate.

            

    

     

    
      	
              4.5

            	
              Facility
                of Distribution.
                If the Plan Administrator determines in its discretion that a benefit
                is
                to be distributed to a minor, to a person declared incompetent or
                to a
                person incapable of handling the disposition of that person’s property,
                the Plan Administrator may direct distribution of such benefit to
                the
                guardian, legal representative or person having the care or custody
                of
                such minor, incompetent person or incapable person. The Plan Administrator
                may require proof of incompetence, minority or guardianship as it
                may deem
                appropriate prior to distribution of the benefit. Any distribution
                of a
                benefit

            

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    shall
      be
      a distribution for the account of the Executive and the Beneficiary, as the
      case
      may be, and shall completely discharge any liability under this Agreement for
      such distribution amount.

    

    Article
      5

    General
      Limitations

    

    
      	
              5.1

            	
              Termination
                for Cause.
                Notwithstanding any provision of this Agreement to the contrary,
                the Bank
                shall not distribute any benefit under this Agreement if the Executive’s
                employment with the Bank is terminated due to a Termination for
                Cause.

            

    

     

    
      	
              5.2

            	
              Suicide
                or Misstatement.
                No benefit shall be distributed if the Executive commits suicide
                within
                two years after the Effective Date of this Agreement, or if an insurance
                company which issued a life insurance policy covering the Executive
                and
                owned by the Bank denies coverage (i) for material misstatements
                of fact
                made by the Executive on an application for such life insurance,
                or (ii)
                for any other reason.

            

    

    

    
      	
              5.3

            	
              Removal.
                Notwithstanding any provision of this Agreement to the contrary,
                the Bank
                shall not distribute any benefit under this Agreement if the Executive
                is
                subject to a final removal or prohibition order issued by an appropriate
                federal banking agency pursuant to Section 8(e) of the Federal Deposit
                Insurance Act.

            

    

    

    
      	
              5.4

            	
              Forfeiture
                Provision.
                The Executive shall forfeit any non-distributed benefits under this
                Agreement if the Executive breaches Section 6 of the Employment
                Agreement.

            

    

    

    Article
      6

    Administration
      of Agreement

    

    
      	
              6.1

            	
              Plan
                Administrator Duties.
                The Plan Administrator shall administer this Agreement according
                to its
                express terms and shall also have the discretion and authority to
                (i)
                make, amend, interpret and enforce all appropriate rules and regulations
                for the administra-tion of this Agreement and (ii) decide or resolve
                any
                and all ques-tions, including interpretations of this Agreement,
                as may
                arise in connection with this Agreement to the extent the exercise
                of such
                discretion and authority does not conflict with Code Section
                409A.

            

    

    

    
      	
              6.2

            	
              Agents.
                In the administration of this Agreement, the Plan Administrator may
                employ
                agents and delegate to them such administrative duties as the Plan
                Administrator sees fit, including acting through a duly appointed
                representative, and may from time to time consult with counsel who
                may be
                counsel to the Bank.

            

    

    

    
      	
              6.3

            	
              Binding
                Effect of Decisions.
                Any decision or action of the Plan Administrator with respect to
                any
                question arising out of or in connection with the administration,
                interpretation or application of this Agreement and the rules and
                regulations promulgated hereunder shall be final and conclusive and
                binding upon all persons having any
                interest

            

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    in
      this
      Agreement. 

    

    
      	
              6.4

            	
              Indemnity
                of Plan Administrator.
                The Bank shall indemnify and hold harmless the Plan Administrator
                against
                any and all claims, losses, damages, expenses or liabilities arising
                from
                any action or failure to act with respect to this Agreement, except
                in the
                case of willful misconduct by the Plan
                Administrator.

            

    

    

    
      	
              6.5

            	
              Bank
                Information.
                To enable the Plan Administrator to perform its functions, the Bank
                shall
                supply full and timely information to the Plan Administrator on all
                matters relating to the date and circum-stances of the death, Disability
                or Separation from Service of the Executive, and such other pertinent
                information as the Plan Administrator may reasonably
                require.

            

    

    

    
      	
              6.6

            	
              Annual
                Statement.
                The Plan Administrator shall provide to the Executive, within one
                hundred
                twenty (120) days after the end of each Plan Year, a statement setting
                forth the benefits to be distributed under this
                Agreement.

            

    

    

    Article
      7

    Claims
      And Review Procedures

    

    
      	
              7.1

            	
              Claims
                Procedure.
                An Executive or Beneficiary (“claimant”) who has not received benefits
                under this Agreement that he or she believes should be distributed
                shall
                make a claim for such benefits as
                follows:

            

    

    

    
      	 	
              7.1.1

            	
              Initiation
                - Written Claim.
                The claimant initiates a claim by submitting to the Plan Administrator
                a
                written claim for the benefits. If such a claim relates to the contents
                of
                a notice received by the claimant, the claim must be made within
                sixty
                (60) days after such notice was received by the claimant. All other
                claims must be made within one hundred eighty (180) days of the date
                on which the event that caused the claim to arise occurred. The claim
                must
                state with particularity the determination desired by the
                claimant.

            

    

     

    

    
      	 	
              7.1.2

            	
              Timing
                of Plan Administrator Response.
                The
                Plan Administrator shall respond to such claimant within ninety (90)
                days
                after receiving the claim. If the Plan Administrator determines that
                special circumstances require additional time for processing the
                claim,
                the Plan Administrator can extend the response period by an additional
                ninety (90) days by notifying the claimant in writing, prior to the
                end of
                the initial ninety (90) day period, that an additional period is
                required.
                The notice of extension must set forth the special circumstances
                and the
                date by which the Plan Administrator expects to render its
                decision.

            

    

    

    
      	 	
              7.1.3

            	
              Notice
                of Decision.
                If the Plan Administrator denies part or all of the claim, the Plan
                Administrator shall notify the claimant in writing of such denial.
                The
                Plan Administrator shall write the notification in a manner calculated
                to
                be understood by the claimant. The notification shall set
                forth:

            

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    

    
      	 	
              (a)

            	
              The
                specific reasons for the denial;

            

    

    
      	 	
              (b)

            	
              A
                reference to the specific provisions of this Agreement on which the
                denial
                is based;

            

    

    
      	 	
              (c)

            	
              A
                description of any additional information or material necessary for
                the
                claimant to perfect the claim and an explanation of why it is
                needed;

            

    

    
      	 	
              (d)

            	
              An
                explanation of this Agreement’s review procedures and the time limits
                applicable to such procedures; and

            

    

    
      	 	
              (e)

            	
              A
                statement of the claimant’s right to bring a civil action under ERISA
                Section 502(a) following an adverse benefit determination on
                review.

            

    

    

    
      	
              7.2

            	
              Review
                Procedure.
                If the Plan Administrator denies part or all of the claim, the claimant
                shall have the opportunity for a full and fair review by the Plan
                Administrator of the denial as
                follows:

            

    

    

    
      	 	
              7.2.1

            	
              Initiation
                - Written Request.
                To initiate the review, the claimant, within sixty (60) days after
                receiving the Plan Administrator’s notice of denial, must file with the
                Plan Administrator a written request for
                review.

            

    

    

    
      	 	
              7.2.2

            	
              Additional
                Submissions - Information Access.
                The claimant shall then have the opportunity to submit written comments,
                documents, records and other information relating to the claim. The
                Plan
                Administrator shall also provide the claimant, upon request and free
                of
                charge, reasonable access to, and copies of, all documents, records
                and
                other information relevant (as defined in applicable ERISA regulations)
                to
                the claimant’s claim for benefits.

            

    

    

    
      	 	
              7.2.3

            	
              Considerations
                on Review.
                In considering the review, the Plan Administrator shall take into
                account
                all materials and information the claimant submits relating to the
                claim,
                without regard to whether such information was submitted or considered
                in
                the initial benefit determination.

            

    

    

    
      	 	
              7.2.4

            	
              Timing
                of Plan Administrator Response.
                The Plan Administrator shall respond in writing to such claimant
                within
                sixty (60) days after receiving the request for review. If the Plan
                Administrator determines that special circumstances require additional
                time for processing the claim, the Plan Administrator can extend
                the
                response period by an additional sixty (60) days by notifying the
                claimant
                in writing, prior to the end of the initial sixty (60) day period,
                that an
                additional period is required. The notice of extension must set forth
                the
                special circumstances and the date by which the Plan Administrator
                expects
                to render its decision.

            

    

    

    
      	 	
              7.2.5

            	
              Notice
                of Decision.
                The Plan Administrator shall notify the claimant in writing of its
                decision on review. The Plan Administrator shall write the notification
                in
                a manner calculated to be understood by the claimant. The notification
                shall set forth:

            

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    
      	 	
              (a)

            	
              The
                specific reasons for the denial;

            

    

    
      	 	
              (b)

            	
              A
                reference to the specific provisions of this Agreement on which the
                denial
                is based;

            

    

    
      	 	
              (c)

            	
              A
                statement that the claimant is entitled to receive, upon request
                and free
                of charge, reasonable access to, and copies of, all documents, records
                and
                other information relevant (as defined in applicable ERISA regulations)
                to
                the claimant’s claim for benefits;
                and

            

    

    
      	 	
              (d)

            	
              A
                statement of the claimant’s right to bring a civil action under ERISA
                Section 502(a). 

            

    

    

    Article
      8

    Amendments
      and Termination

     

    
      	
              8.1

            	
              Amendments.
                This Agreement may be amended only by a written agreement signed
                by the
                Bank and the Executive. However, the Bank may unilaterally amend
                this
                Agreement to conform with written directives to the Bank from its
                auditors
                or banking regulators or to comply with legislative changes or tax
                law,
                including without limitation Code Section
                409A.

            

    

    

    
      	
              8.2

            	
              Plan
                Termination Generally.
                This Agreement may be terminated only by a written agreement signed
                by the
                Bank and the Executive. The benefit shall be the Accrual Balance
                as of the
                date this Agreement is terminated. Except as provided in Section
                8.3, the
                termination of this Agreement shall not cause a distribution of benefits
                under this Agreement. Rather, upon such termination benefit distributions
                will be made at the earliest distribution event permitted under Article
                2
                or Article 3.

            

    

    

    
      	
              8.3

            	
              Plan
                Terminations Under Code Section 409A.
                Notwithstanding anything to the contrary in Section 8.2, if the Bank
                terminates this Agreement in the following
                circumstances:

            

    

    
      

      
        	 	
                (a)

              	
                Within
                  thirty (30) days before or twelve (12) months after a Change in
                  Control,
                  provided that all distributions are made no later than twelve (12)
                  months
                  following such termination of this Agreement and further provided
                  that
                  all the Bank’s arrangements which are substantially similar to
                  this Agreement are terminated so the Executive and all
                  participants in the similar arrangements are required to receive all
                  amounts of compensation deferred under the terminated arrangements
                  within
                  twelve (12) months of such termination;

              

      

      

      
        	 	
                (b)

              	Upon the Bank’s dissolution or with the approval of a
                bankruptcy court provided that the amounts deferred under this Agreement
                are included in the Executive’s gross income in the latest of (i) the
                calendar year in which this Agreement terminates; (ii) the calendar
                year
                in which the amount is no longer subject to a substantial risk of
                forfeiture; or (iii) the first calendar year in which the distribution
                is
                administratively practical; or

      

    
      	 	
              (c)

            	Upon the Bank’s termination of this and all other
              non-account balance plans (as referenced in Code Section 409A), provided
              that all distributions are made no

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    earlier
      than twelve (12) months and no later than twenty-four (24) months following
      such
      termination, and the Bank does not adopt any new non-account balance plans
      for a
      minimum of five (5) years following the date of such termination; 

    

    the
      Bank
      may distribute the Accrual Balance, determined as of the date of the termination
      of this Agreement, to the Executive in a lump sum subject to the above
      terms.

    

    Article
      9

    Miscellaneous

    

    
      	
              9.1

            	
              Binding
                Effect.
                This Agreement shall bind the Executive and the Bank and their
                beneficiaries, survivors, executors, administrators and
                transferees.

            

    

    

    
      	
              9.2

            	
              No
                Guarantee of Employment.
                This Agreement is not a contract for employment. It does not give
                the
                Executive the right to remain as an employee of the Bank nor interfere
                with the Bank’s right to discharge the Executive. It does not require the
                Executive to remain an employee nor interfere with the Executive’s right
                to terminate employment at any
                time.

            

    

    

    
      	
              9.3

            	
              Non-Transferability.
                Benefits under this Agreement cannot be sold, transferred, assigned,
                pledged, attached or encumbered in any
                manner.

            

    

    

    
      	
              9.4

            	
              Tax
                Withholding and Reporting.
                The Bank shall withhold any taxes that are required to be withheld,
                including but not limited to taxes owed under Code Section 409A from
                the
                benefits provided under this Agreement. The Executive acknowledges
                that
                the Bank’s sole liability regarding taxes is to forward any amounts
                withheld to the appropriate taxing authorities. The Bank shall satisfy
                all
                applicable reporting requirements, including those under Code Section
                409A.

            

    

    

    
      	
              9.5

            	
              Applicable
                Law.
                This Agreement and all rights hereunder shall be governed by the
                laws of
                the State of Indiana, except to the extent preempted by the laws
                of the
                United States of America.

            

    

    

    
      	
              9.6

            	
              Unfunded
                Arrangement.
                The Executive and the Beneficiary are general unsecured creditors
                of the
                Bank for the distribution of benefits under this Agreement. The benefits
                represent the mere promise by the Bank to distribute such benefits.
                The
                rights to benefits are not subject in any manner to anticipation,
                alienation, sale, transfer, assignment, pledge, encumbrance, attachment
                or
                garnishment by creditors. Any insurance on the Executive’s life or other
                informal funding asset is a general asset of the Bank to which the
                Executive and Beneficiary have no preferred or secured
                claim.

            

    

    

    
      	
              9.7

            	
              Reorganization.
                The Bank shall not merge or consolidate into or with another bank,
                or
                reorganize, or sell substantially all of its assets to another bank,
                firm
                or person unless such succeeding or continuing bank, firm or person
                agrees
                to assume and discharge the obligations of the Bank under this Agreement.
                Upon the occurrence of such an event,
                the

            

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    term
      “Bank” as used in this Agreement shall be deemed to refer to the successor or
      survivor entity.

    

    
      	
              9.8

            	
              Entire
                Agreement.
                This Agreement constitutes the entire agreement between the Bank
                and the
                Executive as to the subject matter hereof. No rights are granted
                to the
                Executive by virtue of this Agreement other than those specifically
                set
                forth herein.

            

    

    

    
      	
              9.9

            	
              Interpretation.
                Wherever the fulfillment of the intent and purpose of this Agreement
                requires and the context will permit, the use of the masculine gender
                includes the feminine and use of the singular includes the
                plural.

            

    

    

    
      	
              9.10

            	
              Alternative
                Action.
                In the event it shall become impossible for the Bank or the Plan
                Administrator to perform any act required by this Agreement due to
                regulatory or other constraints, the Bank or Plan Administrator may
                perform such alternative act as most nearly carries out the intent
                and
                purpose of this Agreement and is in the best interests of the Bank,
                provided that such alternative act does not violate Code Section
                409A.

            

    

    

    
      	
              9.11

            	
              Headings.
                Article and section headings are for convenient reference only and
                shall
                not control or affect the meaning or construction of any provision
                herein.

            

    

    

    
      	
              9.12

            	
              Validity.
                If any provision of this Agreement shall be illegal or invalid for
                any
                reason, said illegality or invalidity shall not affect the remaining
                parts
                hereof, but this Agreement shall be construed and enforced as if
                such
                illegal or invalid provision had never been included
                herein.

            

    

    

    
      	
              9.13

            	
              Notice.
                Any notice or filing required or permitted to be given to the Bank
                or Plan
                Administrator under this Agreement shall be sufficient if in writing
                and
                hand-delivered or sent by registered or certified mail to the address
                below:

            

    

     

    430
      Clifty Drive

    P.O.
      Box
      1590

    Madison,
      Indiana 47250

     

    Such
      notice shall be deemed given as of the date of delivery or, if delivery is
      made
      by mail, as of the date shown on the postmark on the receipt for registration
      or
      certification.

    

    Any
      notice or filing required or permitted to be given to the Executive under this
      Agreement shall be sufficient if in writing and hand-delivered or sent by mail
      to the last known address of the Executive.

    

    
      	
              9.14

            	
              Deduction
                Limitation on Benefit Payments.
                If the Bank reasonably anticipates that the Bank’s deduction with respect
                to any distribution under this Agreement would be limited or eliminated
                by
                application of Code Section 162(m), then to the extent deemed necessary
                by
                the Bank to ensure that the entire amount of any distribution from
                this
                Agreement is deductible, the Bank may delay payment of any amount
                that
                would otherwise be

            

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    distributed
      under this Agreement. The delayed amounts shall be distributed to the Executive
      (or the Beneficiary in the event of the Executive’s death) at the earliest date
      the Bank reasonably anticipates that the deduction of the payment of the amount
      will not be limited or eliminated by application of Code Section
      162(m).

    

    
      	
              9.15

            	
              Compliance
                with Section 409A.
                This Agreement shall be interpreted and administered consistent with
                Code
                Section 409A.

            

    

    

    IN
      WITNESS WHEREOF, the Executive and a duly authorized representative of the
      Bank
      have signed this Agreement.

    

    
      	
              EXECUTIVE

            	 	
              RIVER
                VALLEY FINANCIAL BANK

            
	 	 	 	 
	 	 	
              By:

            	 
	
              Matthew
                Forrester

            	 	 	 
	 	 	
              Title:

            	 

    

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    River
      Valley Financial Bank

    Salary
      Continuation Agreement

    Beneficiary
      Designation Form 

    
      

    

    

    {   } New
      Designation

    {   } Change
      in
      Designation

    

    I,
      __________________________, designate the following as Beneficiary under this
      Agreement:

    

    
      	
              Primary:

              ___________________________________________________________

               

              ___________________________________________________________

            	
               

              _____%

               

              _____%

               

            
	
              Contingent:

              ___________________________________________________________

               

              ___________________________________________________________

            	
               

              _____%

               

              _____%

               

            

    

     

    Notes:
      

    
      	 	
              ·

            	
              Please
                PRINT CLEARLY or TYPE the names of the
                beneficiaries.

            

    

    
      	 	
              ·

            	
              To
                name a trust as Beneficiary, please provide the name of the trustee(s)
                and
                the exact
                name and date of the trust
                agreement.

            

    

    
      	 	
              ·

            	
              To
                name your estate as Beneficiary, please write “Estate of
                [your
                name]”.

            

    

    
      	 	
              ·

            	
              Be
                aware that none of the contingent beneficiaries will receive anything
                unless ALL of the primary beneficiaries predecease
                you.

            

    

    

    I
      understand that I may change these beneficiary designations by delivering a
      new
      written designation to the Plan Administrator, which shall be effective only
      upon receipt and acknowledgment by the Plan Administrator prior to my death.
      I
      further understand that the designations will be automatically revoked if the
      Beneficiary predeceases me, or, if I have named my spouse as Beneficiary and
      our
      marriage is subsequently dissolved.

    

    Name:   _______________________________

    

    Signature:   _______________________________      Date:   _______

    

    

    Received
      by the Plan Administrator
      this ________ day of ___________________, 200____

    

    By:   _________________________________

    

    Title:   _________________________________EXHIBIT 10.28  

EXECUTION COPY 

 

 

 

ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT 

Between 

US Geothermal, Inc. 

And 

Ormat Nevada, Inc. 

 

 

Dated as of December 5, 2005 

 

 

CONFIDENTIAL 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY 

CONTENTS 

	ARTICLE 1. 	DEFINITIONS, INTERPRETATION AND CONTRACT
      DOCUMENTS 	1 
	 	 	 	 
	 	1.1 	Definitions 	1 
	 	 	 	 
	 	1.2 	Interpretation 	9 
	 	 	 	 
	 	1.3 	Documents Included 	9 
	 	 	 
	ARTICLE 2. 	CONTRACTOR RESPONSIBILITIES 	11 
	 	 	 	 
	 	2.1 	General Responsibilities 	11 
	 	 	 	 
	 	2.2 	Specific Responsibilities 	11 
	 	 	 	 
	 	2.3 	Contractor’s Personnel and Labor Relations
      	12 
	 	 	 	 
	 	2.4 	Representations and Warranties of Contractor
      	13 
	 	 	 	 
	 	2.5 	Use of Spare Parts 	14 
	 	 	 
	ARTICLE 3. 	COMPANY RESPONSIBILITIES 	14 
	 	 	 	 
	 	3.1 	General Responsibilities 	14 
	 	 	 	 
	 	3.2 	Company’s Representative 	15 
	 	 	 	 
	 	3.3 	Representations and Warranties of Company
      	15 
	 	 	 	 
	 	3.4 	Sale of Project 	16 
	 	 	 	 
	 	3.5 	Future Projects 	16 
	 	 	 
	ARTICLE 4. 	COMMENCEMENT OF WORK 	17 
	 	 	 	 
	 	4.1 	Notice to Proceed 	17 
	 	 	 	 
	 	4.2 	Commencement 	17 
	 	 	 	 
	 	4.3 	Substantial Completion 	17 
	 	 	 	 
	 	4.4 	Substantial Completion Certificate 	18 
	 	 	 	 
	 	4.5 	Deemed Substantial Completion 	18 
	 	 	 	 
	 	4.6 	Delay Liquidated Damages and Bonus 	18 
	 	 	 	 
	 	4.7 	Final Completion 	19 
	 	 	 	 
	 	4.8 	Final Completion Certificate 	19 
	 	 	 	 
	 	4.9 	Punchlist 	20 
	 	 	 	 
	 	4.10 	Failure to Achieve Final Completion by the
      Guaranteed Final Completion Date 	20

i 

EXECUTION COPY 

	ARTICLE 5. 	COMPENSATION AND PAYMENT 	21 
	 	 	 	 
	 	5.1 	Contract Price 	21 
	 	 	 	 
	 	5.2 	Payment Milestones 	22 
	 	 	 	 
	 	5.3 	Payment 	22 
	 	 	 	 
	 	5.4 	Final Completion Payment for the Facility
      	23 
	 	 	 	 
	 	5.5 	Payments Not Acceptance of Work 	23 
	 	 	 	 
	 	5.6 	Payment of Subcontractor 	23 
	 	 	 	 
	 	5.7 	Waiver of Liens 	23 
	 	 	 	 
	 	5.8 	Interest 	24 
	 	 	 	 
	 	5.9 	Security Interest 	24 
	 	 	 
	ARTICLE 6. 	TESTING 	24 
	 	 	 	 
	 	6.1 	General 	24 
	 	 	 	 
	 	6.2 	Test Procedures 	24 
	 	 	 	 
	 	6.3 	Notice of Testing 	24 
	 	 	 	 
	 	6.4 	Delayed Tests; Deemed Completion 	25 
	 	 	 	 
	 	6.5 	Facilities 	26 
	 	 	 	 
	 	6.6 	Repeat Performance Tests 	26 
	 	 	 	 
	 	6.7 	Certification or Disagreement as to Test
      Results 	26 
	 	 	 
	ARTICLE 7. 	INTENTIONALLY OMITTED 	26 
	 	 	  
	ARTICLE 8. 	CONSTRUCTION SUSPENSION AND ACCELERATION;
      CHANGE ORDER 	26 
	 	 	 	 
	 	8.1 	Construction Suspension and Acceleration
      	26 
	 	 	 	 
	 	8.2 	Change Orders 	27 
	 	 	 	 
	 	8.3 	Procedure for Change Orders 	27 
	 	 	 	 
	 	8.4 	Change Orders Due to Contractor Error 	28 
	 	 	 	 
	 	8.5 	Change Orders Due to Changes in Law 	28 
	 	 	 	 
	 	8.6 	Effect of Force Majeure; Excused Performance
      	28 
	 	 	 	 
	 	8.7 	Company-Caused Changes 	30 
	 	 	 	 
	 	8.8 	Price Change 	30 
	 	 	 	 
	 	8.9 	Effectiveness; Continued Performance Pending
      Resolution of Disputes 	31 
	 	  	 	 
	 	8.10 	Documentation 	31 

ii 

EXECUTION COPY 

	 	8.11 	Continue Work 	32 
	 	 	 	 
	 	8.12 	Critical Path Schedule Updates 	32 
	 	 	 	 
	 	8.13 	Change Order Constitutes Complete Relief
      	32 
	 	 	 	 
	 	8.14 	Effect of Changes on Warranties and Safety
      	32 
	 	 	 	 
	ARTICLE 9. 	DESIGN AND DOCUMENTATION 	33 
	 	 	 	 
	 	9.1 	Ownership of and Responsibility for Design
      	33 
	 	 	 	 
	 	9.2 	Inspection of Work 	33 
	 	 	 	 
	 	9.3 	As-Built Drawings 	33 
	 	 	 	 
	 	9.4 	License to Use 	33 
	 	 	 	 
	 	9.5 	Use of Documents After Termination 	34 
	 	 	 	 
	 	9.6 	O&M Manual 	34 
	 	 	 	 
	ARTICLE 10. 	WARRANTIES 	34 
	 	 	 	 
	 	10.1 	Warranty 	34 
	 	 	 	 
	 	10.2 	Warranty Period 	35 
	 	 	 	 
	 	10.3 	Defect Remedy Work 	35 
	 	 	 	 
	 	10.4 	Implementation of Warranty 	36 
	 	 	 	 
	 	10.5 	Disclaimer and Release 	36 
	 	 	 	 
	ARTICLE 11. 	PERFORMANCE AND PERFORMANCE RELATED REMEDIES;
      EXCLUSIVITY; LIMITATION OF LIABILITY 	37 
	 	  	 	 
	 	11.1 	Performance Liquidated Damages and Performance
      Bonus 	37 
	 	 	 	 
	 	11.2 	Exclusivity 	37 
	 	 	 	 
	 	11.3 	General Limitation of Liability 	37 
	 	 	 	 
	 	11.4 	Other Provisions 	38 
	 	 	 	 
	ARTICLE 12. 	TITLE; CARE OF THE WORK 	38 
	 	 	 	 
	 	12.1 	Passage of Title 	38 
	 	 	 	 
	 	12.2 	Risk of Loss 	39 
	 	 	 	 
	 	12.3 	Care, Custody and Control 	39 
	 	 	 	 
	ARTICLE 13. 	INSURANCE 	39 
	 	 	 	 
	 	13.1 	Contractor Provided Insurance 	39 
	 	 	 	 
	 	13.2 	Company Provided Insurance 	40 
	 	 	 	 
	 	13.3 	Policies 	41 

iii 

EXECUTION COPY 

	 	13.4 	Payment of Deductibles 	42 
	 	 	 	 
	 	13.5 	Evidence of Insurance 	42 
	 	 	 	 
	ARTICLE 14. 	DISPUTE RESOLUTION 	43 
	 	 	 	 
	 	14.1 	Settlement by Mutual Agreement 	43 
	 	 	 	 
	 	14.2 	Mediation 	43 
	 	 	 	 
	 	14.3 	Pending Disputes 	43 
	 	 	 	 
	ARTICLE 15. 	INDEMNIFICATION 	44 
	 	 	 	 
	 	15.1 	General 	44 
	 	 	 	 
	 	15.2 	Indemnification for Bodily Injury or Property
      Damage 	44 
	 	 	 	 
	 	15.3 	Indemnity from Liens 	44 
	 	 	 	 
	 	15.4 	Contractor’s Infringement Indemnity
      	44 
	 	 	 	 
	 	15.5 	Company’s Indemnity 	45 
	 	 	 	 
	 	15.6 	Notice and Settlement of Claims 	45 
	 	 	 	 
	ARTICLE 16. 	ASSIGNMENT 	46 
	 	 	 	 
	 	16.1 	Assignment by Company 	46 
	 	 	 	 
	 	16.2 	Assignment by Contractor 	46 
	 	 	 	 
	 	16.3 	Succession 	46 
	 	 	 	 
	ARTICLE 17. 	SUBCONTRACTORS 	46 
	 	 	 	 
	 	17.1 	Subcontracts 	46 
	 	 	 	 
	 	17.2 	Subcontract Provisions 	47 
	 	 	 	 
	 	17.3 	Approved Vendors 	47 
	 	 	 	 
	 	17.4 	Exclusion 	47 
	 	 	 	 
	ARTICLE 18. 	SUSPENSION 	48 
	 	 	 	 
	 	18.1 	Right of Company to Suspend Work 	48 
	 	 	 	 
	 	18.2 	Initial Payments to Contractor 	48 
	 	 	 	 
	 	18.3 	Extended Suspension 	48 
	 	 	 	 
	 	18.4 	Right of Contractor to Suspend 	48 
	 	 	 	 
	 	18.5 	Additional Changes Resulting From Suspensions
      	48 
	 	 	 	 
	 	18.6 	Resumption of Work 	49 
	 	 	 	 
	ARTICLE 19. 	TERMINATION 	49 

iv 

EXECUTION COPY 

	 	19.1 	Termination by Company 	49 
	 	 	 	 
	 	19.2 	Termination by Contractor 	50 
	 	 	 	 
	 	19.3 	Due to Force Majeure 	51 
	 	 	 	 
	 	19.4 	Due to Company’s Convenience 	51 
	 	 	 	 
	 	19.5 	Exclusive Remedy 	51 
	 	 	 	 
	 	19.6 	Actions Required Following Termination 	51 
	 	 	 	 
	 	19.7 	Termination and Transfer of Subcontracts
      and Other Rights 	52 
	 	 	 	 
	 	19.8 	Surviving Obligations 	52 
	 	 	 	 
	ARTICLE 20. 	INTENTIONALLY OMITTED 	53 
	 	 	 	 
	ARTICLE 21. 	CONFIDENTIALITY 	53 
	 	 	 	 
	 	21.1 	Both Parties to Keep Information Confidential
      	53 
	 	 	 	 
	 	21.2 	Use of Information 	53 
	 	 	 	 
	 	21.3 	Exclusions 	53 
	 	 	 	 
	 	21.4 	Company Not to Remove Logos 	53 
	 	 	 	 
	ARTICLE 22. 	NOTICES 	53 
	 	 	 	 
	ARTICLE 23. 	MISCELLANEOUS 	55 
	 	 	 	 
	 	23.1 	Governing Law 	55 
	 	 	 	 
	 	23.2 	Construction 	55 
	 	 	 	 
	 	23.3 	Nature of Agreement 	55 
	 	 	 	 
	 	23.4 	Severability 	55 
	 	 	 	 
	 	23.5 	Amendments and Waivers 	56 
	 	 	 	 
	 	23.6 	Survival 	56 
	 	 	 	 
	 	23.7 	Counterparts 	56 
	 	 	 	 
	 	23.8 	Entire Contract 	56 
	 	 	 	 
	 	23.9 	Waivers 	56 
	 	 	 	 
	 	23.10 	Counterparts; Transmitted Copies 	56 
	 	 	 	 
	 	23.11 	Further Assurances 	57 

v 

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LIST OF EXHIBITS

	Exhibit A 	Scope of Work Allocation and Interface Points
      
	 	 
	Exhibit B 	Contract Price, Milestone Payment Schedule
      and Work Milestone Schedule 
	 	 
	Exhibit C 	Power Plant Design Criteria, Drawings and
      Specifications per itemized list of Section 1.3. 
	 	 
	Exhibit D 	Performance Tests and Correction Curves
      
	 	 
	Exhibit E 	Warranty Claim Procedures 
	 	 
	Exhibit F 	Approved Vendors List 
	 	 
	Exhibit G 	Permits 
	 	 
	Exhibit H 	Certificate of Substantial Completion 
	 	 
	Exhibit I 	Certificate of Final Completion 
	 	 
	Exhibit J 	Form of Final Lien Waiver 
	 	 
	Exhibit K 	Liquidated Damages and Bonuses 
	 	 
	Exhibit L 	Change Order Form 
	 	 
	Exhibit M 	Change Order Request Form 

vi 

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ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT 

          THIS
ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT (“Contract”) dated as
of December 5, 2005, is made by and between: 

	(1) 	
      US GEOTHERMAL, INC., an Idaho corporation, with
      its principal place of business at 1509 Tyrell Lane, Suite B, Boise, Idaho
      83706 (“Company”); and 

	 	
       

	(2) 	
      ORMAT NEVADA, INC., a Delaware corporation, with
      its principal place of business at 980 Greg Street, Sparks, NV 89431-6039
      (“Contractor”). 

RECITALS 

          A.      Company
is developing a thirteen (13) MW geothermal power plant in the Raft River Known
Geothermal Resource Area in the State of Idaho and desires to retain Contractor
to provide certain construction related services and to supply equipment in
relation to such power plant. 

          B.     
Contractor desires to be retained by Company to provide construction related
services and supply equipment in relation to Company’s power plant.

AGREEMENT 

     THEREFORE, Company and Contractor
(each individually, a “Party” and together, the “Parties”) agree
as follows: 

ARTICLE
1.      DEFINITIONS,
INTERPRETATION AND CONTRACT DOCUMENTS 

          1.1      Definitions

          In
addition to the terms defined elsewhere in this Contract, the definitions of
certain terms used in this Contract with initial letters capitalized are as set
forth herein. 

          “Affiliate”
means, with respect to any person or entity, any other person or entity
(including any officer, director, shareholder, partner, employee, agent or
representative of such person or entity) that, directly or indirectly through
one or more intermediaries, controls, is controlled by or is under common
control with such first person or entity. For purposes of this definition,
“control” shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a person or
entity, whether through the ownership of voting securities, partnership or other
ownership interests, by contract, by Law or otherwise. 

          “Approved
Vendors” means the vendors set forth in Exhibit F, as amended from
time-to-time pursuant to Section 17.3. 

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          “As-Built
Drawings” has the meaning given to it in Section 9.3. 

          “Capacity
Test” has the meaning given to it in Exhibit D. 

          “Certificate
of Final Completion” means the certificate issued by Contractor to Company
under this Contract, pursuant to Section 4.4. 

          “Certificate
of Substantial Completion” means the certificate issued by Contractor to
Company under this Contract, pursuant to Section 4.3. 

          “Change
in the Work” means a change to the Work as provided in Article 8. 

          “Change
of Law” means any Law, official interpretation thereof or manner of
interpretation thereof, that is amended or modified, is enacted, adopted,
promulgated or otherwise becomes effective or is repealed, revoked, suspended or
not renewed after the Effective Date and which increases Contractor’s cost of
performing the Work, delays Contractor’s performance of the Work or otherwise
adversely affects Contractor’s performance of its obligations under this
Contract.

          “Change
Order” means a written change order based on the form set forth in Exhibit L
describing the Change in the Work and its effect, if any, on the Contract Price,
the Milestone Payment Schedule, the Schedule and any other provision of this
Contract that is affected. 

          “Commencement
Date” has the meaning given to it in Section 4.2. 

          “Company”
has the meaning set forth in the introductory paragraph to this
Contract. 

          “Company
Default” means the failure or delay of Company or its representatives,
agents, subcontractors or suppliers (other than Contractor and its
Subcontractors and their agents and employees) to meet Company’s material
obligations under this Contract, including the obligations identified in Section
3.1. 

          “Company
Indemnified Party” has the meaning set forth in Section 15.1. 

          “Company
Permits” means the Permits to be obtained by Company as described in
Exhibit G and, other than the Contractor Permits, any Permits otherwise
necessary for the construction, operation and maintenance of the Project. 

          “Company’s
Representative” has the meaning given to it in Section 3.2. 

          “Contract”
means this Engineering, Procurement and Construction Contract together with the
Exhibits attached hereto, as the same may be amended or otherwise modified from
time-to-time as permitted herein. 

          “Contract
Price” means the total aggregate price payable to Contractor by Company as
set forth in Exhibit B, and as adjusted pursuant to the provisions of this
Contract. 

          “Contractor”
has the meaning given to it in the Preamble. 

2 

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          “Contractor
Hazardous Materials” has the meaning given to it in Section 2.2(h) .

          “Contractor
Permits” means the Permits to be obtained by Contractor as described
in of Exhibit G. 

          “Contractor’s
Representative” has the meaning given to it in Section 2.3.2. 

          “Correction
Curves” has the meaning(s) given to it in Exhibit D and shall be used to
adjust Facility performance from variations from the Design Conditions and/or
other specified factors (e.g., degradation) as provided therein.

          “Day”
means a twenty-four (24) hour period beginning and ending at 12:00
midnight. 

          “Defect”
or “Defective” means any Work, including any part or component
thereof, that: (i) contains improper or inferior workmanship; (ii) fails to
conform in any material respect with the relevant Drawings or Specifications,
including any Change in the Work; (iii) is not manufactured in any material
respect with the applicable Drawings and the Specifications; and (iv) is not
free from defects in material and workmanship. 

          “Defect
Remedy Work” means Contractor’s repair or replacement of any Defect or Work
that is Defective. 

          “Delay
Liquidated Damages” has the meaning given to it in Section 4.6.1. 

          “Delayed
Payment Rate” means a per annum rate of interest equal to the lesser of (i)
twelve percent (12%) and (ii) the maximum rate permitted by applicable Law. 

          “Design
Conditions” means the design operating conditions for the Facility as set
forth in Exhibit C. 

          “Documents”
means any design, drawing (including the Drawings), certificate, specification
(including the Specifications), report, studies, model, program, record,
pattern, sample, written information and data and other document of whatever
nature (including a record thereof in software form). 

          “Dollars”
or “$” means the lawful currency of the United States of
America. 

          “Drawings”
means the Facility drawings set forth in Exhibit C or otherwise provided by
Contractor to Company pursuant to Article 9 or other terms of this Contract,
including the As-Built Drawings. 

          “Effective
  Date” means the date of this Contract.

          “Facility”
means the unit number one geothermal power plant and related infrastructure to
be located the Raft River Known Geothermal Resource Area in Cassia County in the
State of Idaho to be constructed as part of the development of the Project on
the Site, all as more particularly described in Exhibits A and C, but for
avoidance of doubt excludes the 

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interconnection facilities, geothermal production, re-injection
and cooling tower make-up water wells, the gathering system and other portions
of the Project outside of the power plant island. 

          “Final
Completion” means the satisfaction or deemed satisfaction of each of the
following: (a) Substantial Completion has occurred; (b) Contractor has delivered
final lien waivers and releases from Contractor and Contractor’s Subcontractors
to Company; (c) all Documents which are to be delivered to Company, by
Contractor on or before the Final Completion Date pursuant to this Contract have
in-fact been delivered to Company; (d) all of Contractor’s supplies, personnel,
rubbish and Contractor Hazardous Materials have been removed from the Site; and
(e) all Work other than Punch List Items have been completed in accordance with
this Agreement. 

          “Final
Completion Date” means the earlier of (a) the date upon which the
Certificate of Final Completion was issued by Contractor to Company pursuant to
Section 4.7 (provided that such Certificate of Final Completion has been
subsequently countersigned by Company pursuant to Section 4.8) or (b) the date
upon which Final Completion is deemed to have occurred under this Contract
pursuant to Section 4.8 or Section 6.4.3. 

          “Financing
Parties” means (a) any and all lenders providing senior or subordinated
construction, interim or long-term debt financing or refinancing; and (b) any
and all equity investors providing leveraged lease-financing or refinancing, and
in each case any trustee or agent acting on their behalf, for the Facility.
Company shall provide written notice to Contractor of the names of all of the
Financing Parties.

          “Force
Majeure” means any war, declared or not, invasion, armed conflict or act of
public enemy, blockage, embargo, revolution, insurrection, riot, civil
commotion, act of terrorism, or sabotage provided that any such event occurs
within or directly involving the United States or any individual state, or any
other country from which machinery, equipment or material for the Facility are
procured or transported through, an act of God, including, but not limited to,
lightning, fire, earthquakes, volcanic activity, floods, storms or unusual
weather conditions, cyclones, typhoons, or tornadoes, labor disputes including
strikes, or slowdowns, or lockouts that extend beyond the Facility or are
widespread or nationwide, or any other event or circumstances or combination of
event(s) or circumstances beyond the reasonable control of a Party, that have a
real, quantifiable and adverse impact on cost or performance of the Work. 

          “Gross
Invoice Amount” has the meaning given to it in Section 5.3.1. 

          “Governmental
Authority” means any local, state, regional, central or national
government administrative, judicial or executive organs, but excluding any
similar foreign or multinational entity, that has or purports to have or asserts
or attempts to assert, jurisdiction to legislate, decree, adjudicate or enforce
any decision related to, or bearing on, the Facility or the Work. 

          “Guaranteed
  Final Completion Date” means the Guaranteed Final Completion Date identified
  in the Schedule, as the same may be amended from time-to-time in accordance
  with this Contract.

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          “Guaranteed
  Substantial Completion Date” means the Guaranteed Substantial Completion
  Date identified in the Schedule, as the same may be amended from time-to-time
  in accordance with this Contract.

          “Hazardous
Materials” means any hazardous or toxic substances, materials and wastes
which are regulated or are classified as hazardous or toxic by any Governmental
Authority having jurisdiction over the Site, including, but not limited to,
those substances included in the definitions of “Hazardous Substances,”
“Hazardous Materials,” “Toxic Substances,” “Hazardous Waste,” “Solid Waste,”
“Pollutant,” or “Contaminant"” in any federal, state, local or
other Law pertaining to public or worker health, welfare or safety or the
environment, including, but not limited to, the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, 42 U.S.C. § 9601 et
seq., as amended by the Superfund Amendments and Reauthorization Act of
1986; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C.
§ 6901 et seq.; the Federal Clean Air Act, 42 U.S.C. § 7401-7626; the
Federal Water Pollution Control Act and Federal Clean Water Act of 1977, as
amended, 33 U.S.C. § 1251 et seq.; the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. § 135 et seq.; the Federal Environmental
Pesticide Control Act, the Federal Toxic Substances Control Act, 15 U.S.C. §
2601 et seq.; the Federal Safe Drinking Water Act, 42 U.S.C. § 300(f)
et seq.; the Emergency Planning and Community Right-To-Know Act of 1986,
42 U.S.C. § 11001 et seq.; and the Occupational Safety and Health Act of
1970, 29 U.S.C. § 651 et seq. and in the regulations promulgated pursuant
to those laws. 

          “Information”
means any Drawings, Specifications or other information furnished directly or
indirectly by the other Party hereto in connection with the Contract and the
Facility and the Project whether such Information has been furnished prior to,
during or following termination of the Contract in connection with the
performance of this Contract. 

          “Insolvency
Event” means the bankruptcy, insolvency, liquidation, administration or
other receivership or dissolution of a Party and any equivalent or analogous
Proceedings by whatever name known and in whatever jurisdiction and any step
taken (including the presentation of a petition or the passing of a resolution)
for or with a view to any of the foregoing. 

          “Law”
means any federal, state, commonwealth, local or other constitution, charter,
act statute, law, ordinance, treaty, resolution, directive (to the extent having
the force of law), code, rule, regulation, order, specified standards or
objective criteria contained in any applicable permit or approval, which
standards or criteria must be met in order for the Facility to be constructed
and operated lawfully, and other legislative or administrative action of any
Governmental Authority, or a final decree, judgment or order of a court, or any
applicable engineering, construction, safety or electrical generation code.

          “Letter
of Credit” means a stand-by letter of credit procured: (i) by Company, or
(ii) through one or more of the Financing Parties for the benefit of Company and
in favor of Contractor, and which shall be sufficient to pay Contractor any
balance of sums owed to Contractor by Company pursuant to this Contract (as such
Letter of Credit may be updated from 

5 

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time-to-time), but in particular with respect to the payment
terms set forth in Section 5.3.1 and the Schedule.

          “Liability”
or “Liabilities” means any fine, penalty, damage, loss, cost, claim or
expense or other liability (including any related fees, expenses and
disbursements of a Party’s counsel). 

          “Liquidated
Damages” means Delay Liquidated Damages, Performance Liquidated Damages,
Shortfall Generation Liquidated Damages and Net Performance Liquidated Damages.

          “Major
Vendor” means any vendor engaged directly by Contractor to provide equipment
for incorporation into the Work at the Site, whose Work is valued in excess of
One Million Dollars ($1,000,000). 

          “Materials”
means all equipment, supplies, apparatus, instruments, machinery (including the
OEC), parts, tools, components, appliances, spare parts and appurtenances
thereto to be supplied under this Contract by Contractor as described in or
required by the Scope of Work. 

          “Milestone
Payment Schedule” means the payment schedule for payment of the Contract
Price as set forth in Exhibit B. 

          “Minimum
Payment” has the meaning given to it in Section 5.3.1. 

          “Month”
means a period beginning at 12:00 midnight on the last Day of the preceding
calendar month and ending at 12:00 midnight on the last Day of the calendar
month. 

          “MW”
means megawatts. 

          “Net
  Deliverable Capacity” has the meaning given to it in Exhibit D.

          “Net
Performance Liquidated Damages” means the Performance Liquidated Damages
less the amount of Shortfall Generation Liquidated Damages paid or payable by
Contractor to Company pursuant to Section 4.10. 

          “Notice
to Proceed” means the notice issued by Company to Contractor authorizing
Contractor to commence the Work under this Contract. 

          “O&M
Manual” means the operation and maintenance manual to be provided by
Contractor to Company pursuant to Section 9.6. 

          “OEC”
means the Ormat Energy Converter. 

          “Party”
and “Parties” have the meanings given to them in the Preamble. 

          “Performance
Bonus” has the meaning given to it in Section 11.1.3. 

          “Performance
Guarantee” means the guaranteed minimum level of Net Deliverable Capacity to
be attained as specified in Exhibit D. 

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          “Performance
Liquidated Damages” has the meaning given to it in Section 11.1.1. 

          “Performance
Tests” means the Synchronization Test, the Trip Test, the Capacity Test, the
Reliability Test, and the Turbine Run Back Test (all as are defined in Exhibit
D) to be carried out to determine whether the Facility satisfies the performance
requirements set forth in this Contract. 

          “Permits”
means the permits, approvals and licenses required from Governmental Authorities
necessary for the construction, operation and maintenance of the Facility and
the performance of the Work.

          “PPA”
means the Firm Energy Sales Agreement in effect between Idaho Power Company and
US Geothermal Inc. under which the output from the Facility would be delivered
and bought. 

          “Proceeding”
means any claim, suit, demand, allegation, arbitration, dispute or other action
process, or proceeding whether actual or threatened. 

          “Project”
means the geothermal power generation project unit number one to be constructed
in the Raft River Known Geothermal Resource Area in Cassia County in the State
of Idaho, including the Facility and the related substation, geothermal
production and re-injection wells and the gathering system, all as more
particularly described in the Power Plant Design Criteria document included in
Exhibit C. 

          “Prudent
Industry Practices” means those practices, methods, equipment,
specifications and standards of safety and performance, as the same may change
from time-to-time, as are commonly used in operations of privately-owned
geothermal electric power generation facilities similar to the Facility, which
in the exercise of reasonable judgment and in light of the facts known at the
time the decision was made, are considered good, safe and prudent practice in
connection with the operation and maintenance of geothermal electric power
generation facilities similar to the Facility. Prudent Industry Practices are
not intended to be limited to the optimal practices, methods, equipment,
specifications and standards, but rather to be the practices, methods,
equipment, specifications and standards generally accepted in the
privately-owned geothermal electric power industry. 

          “Punchlist
Items” means unfinished items of Work (such as Spare Parts, painting,
fine-finish grading or clean-up, updating of Drawings, manuals or other
Documents) the lack of which or the failure of which to complete (considered
individually or in the aggregate of all Punchlist Items) does not or will not
adversely affect the, safety or integrity of the Facility and does not impact
the performance of the Facility. 

          “Safety
Plans” has the meaning given to it in Section 2.3.4. 

          “Safety
Report” has the meaning given to it in Section 2.3.4. 

7 

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          “Schedule”
means Exhibit B, as it may be amended from time-to-time as set forth in this
Contract, which sets forth the Work performance and payment milestone schedule
for the Facility. 

          “Schedule
Bonus” has the meaning given to it in Section 4.6.2. 

          “Scope
of Work” means the specific delineation of items of Work to be performed by
Contractor as set forth in Exhibit A, which may be modified pursuant to a Change
Order pursuant to Article 8, and which shall conform to the Drawings and the
Specifications. 

          “Shortfall
  Generation Liquidated Damages” has the meaning given to it in Section
  4.10.3.

          “Site”
means the site more specifically described in Exhibit C, together with spaces,
surface water, ground water, diversion weirs, roads, easements, privileges,
access rights, rights-of-way and other rights and interests in land and water
acquired or to be acquired by Company to develop, engineer, build, own, operate
or maintain the Facility and appurtenant facilities, including any associated
working and laydown areas for Contractor. 

          “Spare
Parts” means the spare parts for the Facility to be provided by Company as
described in Exhibit C. 

          “Specifications”
means the system descriptions, technical specifications and performance
specifications and standards for the Facility and the performance of the Work as
set forth in Exhibit C. 

          “Synchronization
Test” means a test whereby the Facility OEC is synchronized to the power
grid, as described in Exhibit D. 

          “Subcontract”
means an agreement between Contractor and a Subcontractor for the performance of
any portion of the Work. 

          “Subcontractor”
means any person or entity, other than Contractor’s employees, engaged by
Contractor to perform services relating to the Work. 

          “Substantial
Completion” means the performance of the Work requirements specified in
Section 4.3. 

          “Substantial
Completion Date” means the earlier of (a) the date upon which the
Certificate of Substantial Completion was issued by Contractor to Company
pursuant to Section 4.3 (provided that such Certificate of Substantial
Completion is subsequently countersigned by Company pursuant to Section 4.4) or
(b) the date upon which Substantial Completion is deemed to have occurred under
this Contract pursuant to Section 4.5. 

          “Tax”
means any present or future tax, charge, levy, impost or duty of any kind
whatsoever, or any amount payable on account of or as security for any of the
foregoing, 

8 

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imposed by any Governmental Authority together with any
penalties, additions, liens, surcharges and interest relating thereto. 

          “Trip
Test” has the meaning given to it in Exhibit D. 

          “Warranty
Period” has the meaning given to it in Section 10.2. 

          “Work”
means all of the work, services and other duties, obligations and
responsibilities that are to be carried out by or under the direction of
Contractor pursuant to this Contract, including that work specifically described
as Contractor liabilities in the Scope of Work. 

          1.2     
Interpretation 

                 
    1.2.1      Where the context
requires, words importing the singular shall include the plural and vice versa,
and words importing persons shall include entities. 

                 
    1.2.2      A reference in
this Contract to any Article, Section, Exhibit, Clause or Paragraph is, except
where it is expressly stated to the contrary, a reference to such article,
section, exhibit, clause or paragraph in this Contract. 

                       1.2.3      Headings
are for convenience of reference only. 

                       1.2.4      Each
reference to this Contract shall include a reference to each agreed variation of
or supplement to this Contract as may be amended, varied or supplemented from
time-to-time. 

                       1.2.5      Where
the context requires, any reference to a person, entity or Party shall include
such person’s, entity’s or Party’s successors and permitted assigns. 

                     
1.2.6      References to the word “include” or
“including” are to be construed without limitation. 

          1.3      Documents
Included 

          This
Contract shall consist of this document and the following Exhibits, which are
specifically incorporated herein and made a part hereof by this reference. 

	 	Exhibit A 	Scope of Work Allocation and Interface Points 
	 	 	 
	 	Exhibit B 	Contract Price, Milestone Payment Schedule and
      Work Milestone Schedule
	 	  	
	 	Exhibit C 	Power Plant Design Criteria, Drawings and Specifications
    
	 	 	 

	 	a) 	Power Plant Design Criteria, dated December 5, 2005; 

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	 	b) 	
      Design Point Heat and Mass Balance Diagrams (Guaranteed,
      Design, Winter Average, Summer Average), drawing numbers 0.002.95.873.0,
      sheets 1 through 4, Rev 0. 

	 	 	
       

	 	c) 	
      The Process Flow Diagram number 7.011.00.981.0, rev P5;
      

	 	 	
       

	 	d) 	
      P&ID drawing numbers (not a complete list of all
      drawings required for the Facility): 

	Drawing Number 	Rev. 
	7.011.00.969.0 	P5 
	7.011.00.973.0 	P3 
	7.011.00.974.0 	P5 
	7.011.00.977.0 	P2 
	7.011.00.978.0 	P2 
	7.011.00.979.0 	P4 
	7.011.00.982.0 	P1 
	7.011.00.983.0 	P1 
	7.011.00.984.0 	P1 
	7.011.00.985.0 	P1 
	7.011.00.986.0 	P2 
	7.011.00.987.0 	P2 
	7.011.00.988.0 	P1 
	7.011.00.989.0 	P1 

	 	e) 	Electrical 1-line and other control, and protection drawings numbers.
    

	Drawing Number 	Rev. 
	7.002.25.853.0 	P1 
	7.002.25.887.0 	B 
	7.002.25.888.0 	_ (0) 

	 	f) 	Site Plan drawing number 7.011.00.970.0, rev P5.

	 	Exhibit D 	Performance Tests and Correction Curves 
	 	 	 
	 	Exhibit E 	Warranty Claim Procedures 
	 	 	 
	 	Exhibit F 	Approved Vendors List 
	 	 	 
	 	Exhibit G 	Permits 
	 	 	 
	 	Exhibit H 	Certificate of Substantial Completion 

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	 	Exhibit I 	Certificate of Final Completion 
	 	 	 
	 	Exhibit J 	Form of Final Lien Waiver 
	 	 	 
	 	Exhibit K 	Liquidated Damages and Bonuses 
	 	 	 
	 	Exhibit L 	Change Order Form 
	 	 	 
	 	Exhibit M 	Change Order Request Form 

ARTICLE
2.      CONTRACTOR
RESPONSIBILITIES 

          2.1      General
Responsibilities 

                     
2.1.1      Except as otherwise expressly set forth
in this Contract, Contractor, in consideration of the Contract Price, shall
provide, furnish and perform, or cause to be provided, furnished or performed,
engineering and design services, Materials, consumables and utilities, and
supervision, labor and services required for the development, design,
engineering, procurement, manufacturing, transport to Site, quality assurance,
inspection, erection, construction, commissioning and performance testing of the
Facility as specified in the Scope of Work and in accordance with the provisions
of this Contract. 

                     
2.1.2      Contractor shall diligently prosecute
the Work in a good and workmanlike manner in accordance with the Schedule and in
accordance with the provisions of this Contract. 

          2.2      Specific
  Responsibilities

          Without
limiting the generality of Section 2.1.1 and subject to the terms and conditions
set forth in this Contract, Contractor shall at its own expense furnish,
undertake, provide or cause to be furnished, undertaken or provided the
following: 

                    (a)      preparation
  of the conceptual design and integrated detail design and engineering for the
  Facility such that the Facility conforms to the Scope of Work and meets the
  performance and other requirements described in this Contract;

                    (b)      obtain
the Contractor Permits from the applicable Governmental Authorities; 

                   (c)      coordinate
  its activities pursuant to this Contract with those activities of Company’s
  other contractors as requested by Company; provided, however, that such coordination
  does not delay or otherwise unreasonably interfere with Contractor’s performance
  of the Work in accordance with the Schedule; 

                    (d)      clearing,
  excavation, backfilling, compaction, consolidation and removal or importation
  of related materials required with respect to preparation of the Site in accordance
  with the Scope of Work;

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                    (e)     
procurement, supply and transportation to the Site of all Materials necessary to
complete the Facility; 

                    (f)      supervision
  and direction of construction and other Work activities on the Site, including
  construction by Subcontractors, and the coordination of the Work under this
  Contract; 

                    (g)      keep
the Site from waste materials or rubbish caused by Contractor’s activities and
in a reasonably presentable condition given the nature of the Work. Contractor
may store all rubbish and construction debris in an authorized disposal area
furnished by Company as provided in Section 3.1(i) . Contractor shall be
responsible for the containment of any such material within such area. All
rubbish and construction debris caused by Contractor’s activities shall be
disposed through a licensed waste hauler, or in a licensed waste disposal site.

                    (h)      remediate
  and dispose of in accordance with applicable Law any Hazardous Materials generated,
  transported or released by Contractor or any Subcontractor on or about the Site
  (“Contractor Hazardous Materials”);

                    (i)      training,
in the operation and maintenance of the Facility, of a reasonable number of
operating and maintenance personnel furnished by Company pursuant to Section
3.1(f) . Such training shall be carried out in conjunction with the normal
commissioning, start-up operations and testing activities of Contractor; 

                    (j)      provide
  periodic reports to Company, not less frequently than monthly, regarding the
  progress of the Work, including a Gantt Chart in MS Project format in sufficient
  detail to allow a reasonably experienced engineer to evaluate the progress of
  the Work;

                    (k)     
commission and test the Facility as detailed in Exhibit D; and 

                    (l)     
clearance of the Site of temporary structures, surplus Materials and tools that
were delivered or created by Contractor through the course of the Work, upon
completion of field work; provided that Contractor shall offer to sell to
Company at cost any such temporary structures, surplus Materials and tools that
Contractor does not want to retain. 

          2.3      Contractor’s
Personnel and Labor Relations 

                 
    2.3.1      Contractor
shall ensure that there are at all times at the Site while the Work is being
performed at the Site there are sufficient suitably qualified and experienced
personnel to supervise and perform such Work. 

                
     2.3.2      Contractor
shall designate, by written notice to Company, a representative who shall act as
a single point of contact with Company in all matters relating to the Work
(“Contractor’s Representative”). Contractor’s Representative shall have
full authority to act on behalf of Contractor for all purposes in connection
with this Contract. 

                
     2.3.3      Company
shall be entitled by written notice to Contractor to object to any
representative or person employed by Contractor (including Contractor’s
Representative) or any 

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Subcontractor in the execution of the Work who, in the
reasonable opinion of Company, is incompetent or negligent, or engaged in
misconduct, and Contractor shall promptly remove such person from the Work and
appoint a suitable replacement, or ensure that the relevant Subcontractor does
so. 

                
     2.3.4      Contractor
shall develop, present to Company and implement a safety plan for its own
construction activities on the Site and for emergency situations prior to the
commencement of Work at the Site (“Safety Plans”). During performance of
the Work, Contractor shall publish work safety rules for the Site in compliance
with the Safety Plan, which safety rules shall apply to any and all visitors to
the Site, including representatives of Company. Each week (or other interval
mutually agreeable to Company and Contractor), Contractor shall prepare and
provide to Company a written report (“Safety Report”) listing (i) any
breaches or violations of the Safety Plan, (ii) a description of any incidents
resulting therefrom, (iii) incidents related to safety issues at the Site, (iv)
the cause of any such incident, (v) the nature of such incident, (vi) the
severity of such incident, and (vii) the remedial actions planned to remedy such
incident and prevent such incident from occurring in the future. 

                 
    2.3.5      Contractor shall be
responsible for the security and protection (i) of its equipment, supplies and
tools used in connection with the Work through the Final Completion Date, and
(ii) for all of the other property owned or leased by Contractor or any of its
Subcontractors located at the Site at areas thereon provided by Company or
stored or warehoused off the Site through the Final Completion Date. Contractor
shall use due care to protect any of Company’s property at any time in its
possession or under its control while performing the Work which shall not be
less than the care exercised by Contractor with its own property and Contractor
shall be responsible for any damage to such property resulting from its failure
to use such care. 

                
     2.3.6      Contractor
shall conduct all of its activities within the boundaries of the Site.
Contractor, its Subcontractors, agents and employees shall observe all pertinent
and reasonable regulations and rules issued by Company to Contractor which are
in effect at the Site, as the case may be, regarding passes, badges and proper
conduct on such Site. Company may issue reasonable modifications to such
regulations and rules from time-to-time. 

                 
    2.3.7      Company and its
agents, employees and other contractors shall observe all pertinent and
reasonable regulations and rules issued by Contractor, including the Safety
Plan, which are in effect at the Site, as the case may be, regarding passes,
badges and proper conduct on such Site. Contractor may issue reasonable
modifications to such regulations and rules from time-to-time. 

          2.4      Representations
and Warranties of Contractor 

          Contractor
represents and warrants to Company that: 

                    (a)     
  Contractor is a corporation duly organized, validly existing and in good standing
  under the Laws of the state of Delaware and has the requisite legal power and
  authority to execute, deliver and perform this Contract; 

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                    (b)      the
  execution, delivery and performance by Contractor of this Contract has been
  duly authorized by all requisite action of Contractor, and there is no provision
  in its charter documents requiring further consent for such action by any other
  person or entity; and

                    (c)      this
Contract constitutes the legal, valid and binding obligation of Contractor,
enforceable against Contractor in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, reorganization,
moratorium or similar laws affecting or limiting creditors’ rights generally or
by equitable principles relating to enforceability. 

          2.5     
Use of Spare Parts 

          Spare
parts may be withdrawn by Contractor from the Spare Parts for the purposes of
the Work. Contractor shall be responsible, at its cost, for replacing any such
withdrawn Spare Parts as soon as reasonably practicable and in any event no
later than the expiration of the Warranty Period. 

ARTICLE
3.      COMPANY RESPONSIBILITIES

          3.1      General
Responsibilities 

          Company
  shall, at Company’s expense, furnish, undertake, provide or cause to be
  furnished, undertaken or provided the following: 

                    (a)     
  make available to Contractor and its Subcontractors by the time specified in
  the Schedule, and continuing until the end of the Warranty Period, the Site,
  including space for all construction facilities, laydown and storage areas,
  and roads and other means of access to and from the Site in a timely manner
  and in accordance with Contractor’s reasonable requirements regarding amount,
  weight and dimensions of equipment to be transported and the size and layout
  of the laydown and storage areas;

                    (b)     
obtain and maintain in effect all Company Permits from the Governmental
Authorities in a timely manner as required to permit Contractor and its
Subcontractors to proceed with the Work in accordance with the Schedule;

                    (c)     
  prepare and/or obtain all environmental impact assessments, studies and statements
  and geotechnical reports required in connection with the ownership, financing,
  construction, operation and maintenance of the Facility and the performance
  of this Contract; 

                    (d)     
  furnish to Contractor copies of any environmental impact assessment, studies
  and statements and geotechnical reports prepared or obtained as provided in
  Section 3.1(c) and any information, a power of attorney (if required) and any
  other items reasonably necessary for Contractor to obtain the Contractor Permits
  or perform the Work in a timely manner as required to permit Contractor and
  its Subcontractors to proceed with the Work in accordance with the Schedule;

                    (e)      arrange
for electricity, water and other utilities to be available to Contractor at then
current market terms for the same for use in the construction, start-up, testing

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and commissioning of the Facility, in a timely manner as required
  to permit Contractor and its Subcontractors to proceed with the Work in accordance
  with the Schedule; 

                    (f)     
  provide a reasonably sufficient number of operating personnel, including their
  supervisors, for training by Contractor as provided in Section 2.2(i), and for
  participating in the start-up, testing, commissioning, maintenance and upkeep
  of the Facility through to Final Completion. Each person designated for training
  by Company shall be a qualified technician and said trainees shall not be deemed
  employees or Subcontractors of Contractor;

                    (g)      provide
  the geothermal heat resource in the quantity and quality detailed in the Design
  Conditions, and in the time frame as required to permit Contractor and its Subcontractors
  to proceed with the Work in accordance with the Schedule; 

                    (h)     
  provide or make arrangements for the tie-in point to the electricity grid (or
  any other defined electricity consumer) to be ready in a timely manner in accordance
  with the Schedule; 

                    (i)     
provide to Contractor a rubbish and construction debris (but not for Contractor
Hazardous Materials) storage area on or adjacent to the Site. Disposal of such
Contractor materials stored therein shall be the responsibility of the
Contractor, pursuant to Section 2.2 (g). 

                    (j)      any
removal or disposal of the existing transite pipe on the Site exposed during the
Work; and 

                    (k)     
  remediate and dispose of in accordance with applicable Law any Hazardous Materials
  that are found or are uncovered on or about the Site other than Contractor Hazardous
  Materials that are the responsibility of Contractor as provided in Section 2.2(h)
  .

          3.2      Company’s
Representative 

          Company
shall designate by written notice to Contractor a representative who shall act
as a single point of contact with Contractor in all matters relating to the Work
(“Company’s Representative”). Company’s Representative shall have full
authority to act on behalf of Company for all purposes in connection with this
Contract. 

          3.3     
Representations and Warranties of Company

          Company
represents and warrants that: 

                    (a)      Company
  is a corporation duly organized and validly existing under the Laws of the State
  of Idaho and has all requisite legal power and authority to execute, deliver
  and perform this Contract;

                    (b)      the
execution, delivery and performance by Company of this Contract have been duly
authorized by all requisite corporate action of Company and there is no
provision 

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in its charter documents requiring further consent for such action
  by any other person or entity; and

                    (c)     
this Contract constitutes the legal, valid and binding obligation of Company,
enforceable against Company in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, reorganization,
moratorium or similar laws affecting or limiting creditors’ rights generally or
by equitable principles relating to enforceability. 

          3.4      Sale
of Project 

          If
prior to the expiry of the Warranty Period (or any extension thereof) Company
elects to convey or otherwise transfer its right, title and interest in and to
the Project or in and to the owner of the Project, Company shall provide written
notice of such intent to Contractor. Transfer to any third party shall not
relieve Company of any obligation hereunder, whether such obligation arises
prior to or after the transfer. 

          3.5      Future
Projects 

          In
the event that Company or its Affiliates elect to pursue up to two (2)
additional geothermal power plants in its expansion of the Project, Company or
its Affiliates shall have the option to acquire from Contractor, and Contractor
shall have the option to provide to Company or its Affiliates, the services and
equipment of the type provided by Contractor under this Contract for a lump-sum
payment for each power plant equal to the Contract Price subject to adjustment
as follows. The Contract Price, for purposes of this Section 3.5, may be
adjusted to reflect changes in applicable materials and labor prices as
determined from relevant published cost indices from the Effective Date of this
Contract, to the effective date of the subsequent contract(s). The services and
equipment provided by Contractor with respect to the power plants described
above shall be provided and subject to an EPC agreement with terms and
conditions substantially the same as set forth in this Contract.

          In
the event that Company elects to pursue the installation of the two such
additional power plant in its expansion of the Project at the same time, Company
or its Affiliates shall have the option to acquire from Contractor and
Contractor shall have the option to provide to Company or its Affiliates the
services and equipment of the type provided by Contractor under this Contract
with respect to such power plant for a lump-sum payment equal to (a) two (2)
times the Contract Price subject to adjustment as provided above minus, (b) a
reasonable discount, determined by Contractor in its sole discretion, that
reflects the economies of scale in performing EPC contract services and
equipment for the simultaneous supply of the two geothermal power plants. The
option provided to each of Company (and its Affiliates) and Contractor if such
parties have not entered into a definitive EPC agreement or EPC agreements
reflecting such terms and conditions on or before December 31, 2007. 

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ARTICLE
4.      COMMENCEMENT OF WORK

          4.1     
Notice to Proceed 

          Company
  shall issue a Notice to Proceed to Contractor only at such time as Company has
  arranged financing reasonably satisfactory to Contractor as being sufficient
  for Company to be able to meet its obligations under this Contract and to develop
  the Project and pays to Contractor simultaneously with the issuance of such
  Notice to Proceed the amount specified for the first payment milestone set forth
  in the Schedule. The Notice to Proceed shall not be issued by Company prior
  to February 1, 2006 and Contractor shall have the right to terminate this Contract
  if the Notice to Proceed has not been provided by June 1, 2006. 

          4.2      Commencement

          Subject
to Section 4.1, Contractor shall commence performance of the Work promptly upon
receipt of a Notice to Proceed from Company (“Commencement Date”).
Contractor shall thereafter proceed diligently to perform the Work and
furnishing sufficient forces, construction plant and equipment to perform the
Work in accordance with the Schedule. 

          4.3      Substantial
Completion 

          Contractor
shall achieve Substantial Completion of the Facility on or before the Guaranteed
Substantial Completion Date. When all of the following conditions have been met
with respect to the Facility, Contractor shall issue to Company a Certificate of
Substantial Completion in substantially the same form as that set forth in
Exhibit H: 

                    (a)      all
  of the Work, except for completion of insulation, painting, final grading, the
  As-Built Drawings, training and any other portion of the Work not affecting
  the operability, safety, mechanical and/or electrical integrity of the Facility,
  have been properly constructed, installed, correctly adjusted and tested, are
  mechanically, electrically and structurally sound and comply with the Drawings
  and the Specifications, and can be used safely;

                    (b)      all
Documents which are to be delivered to Company by Contractor on or before the
Substantial Completion Date pursuant to this Contract have, in fact, been
delivered to Company (including, but not limited to, a waiver and release of
Contractor’s and all of its Subcontractor’s mechanics’ liens through such date
(which may be conditioned upon payment by Company)); 

                    (c)      Contractor
has made training available to Company’s personnel (or other nominees of
Company) and written operating procedures sufficient to safely start-up and
continuously operate the Facility; and 

                    (d)     
  the Synchronization Test has been satisfactorily completed.

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          4.4      Substantial
Completion Certificate 

          Within
ten (10) Days following the receipt of the Certificate of Substantial
Completion, Company shall inspect the Facility and review all Work and services
performed by Contractor with respect thereto, and shall either (i) deliver to
Contractor the Certificate of Substantial Completion countersigned and
certifying that the requirements of this Contract applicable to Substantial
Completion have been fully satisfied for the Facility and Substantial Completion
of the Facility has accordingly been achieved or (ii) if reasonable cause exists
for doing so, notify Contractor in writing that Substantial Completion of the
Facility has not been achieved, stating in detail the reasons therefore. In the
event that Company determines that Substantial Completion has not been achieved
and Contractor has not disputed Company’s determination, Contractor shall
promptly take such corrective action or perform such additional Work or other
services as shall achieve Substantial Completion of the Facility and shall issue
to Company another Certificate of Substantial Completion. Such procedure shall
be repeated until Substantial Completion of the Facility has been achieved;
provided, however, that Company shall respond to any such subsequent Certificate
of Subsequent Completion within five (5) Days following the receipt thereof.

          4.5      Deemed
Substantial Completion 

          Deemed
completion may occur under one (1) or both of two (2) circumstances, when: (a)
Company fails to provide the countersigned Certificate of Substantial Completion
as contemplated in Section 4.4 within the period referenced therein; or (b)
Contractor’s conduct or completion of the Synchronization Test is delayed from
the date on which such test would otherwise have commenced, been conducted or
completed due to a Company Default and Contractor has completed all of the other
requirements set forth in Section 4.3. In the event of (b), Contractor shall
notify Company of having achieved deemed Substantial Completion pursuant to
Section 4.4. 

          4.6      Delay
Liquidated Damages and Bonus 

                     
4.6.1      The Parties agree that it would be
extremely difficult and impracticable under the presently known and anticipated
facts and circumstances to ascertain and fix the actual damages that Company
would incur should Contractor fail to achieve Substantial Completion by the
Guaranteed Substantial Completion Date, and accordingly, the Parties hereby
agree that if Contractor fails to so achieve Substantial Completion by the
Guaranteed Substantial Completion Date, then Company shall be entitled to
recover from Contractor as liquidated damages for such delay, and not as a
penalty, the amounts set forth in Section 1 of Exhibit K (“Delay Liquidated
Damages”). The Delay Liquidated Damages are, subject to Section 4.10 and
Article 19, Company’s sole and exclusive remedy in the event Contractor fails to
achieve any of the milestones for the Facility, including Substantial
Completion, by the dates set forth in the Schedule. Company and Contractor
further agree that the Delay Liquidated Damages are a good faith estimate of the
damages Company would suffer. 

                    
 4.6.2      If the Substantial Completion Date
occurs prior to the Guaranteed Substantial Completion Date, Company shall pay to
Contractor a bonus, for each Day which 

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shall elapse between the Substantial Completion Date and the
  Guaranteed Substantial Completion Date, the amounts set forth in Section 2 of
  Exhibit K (“Schedule Bonus”).

          4.7     
Final Completion 

          When
all of the following conditions have been met with respect to the Facility,
Contractor shall issue to Company a Certificate of Final Completion in
substantially the same form as that set forth in Exhibit I: 

                    (a)     
  except for the Punchlist Items and As-Built Drawings, the Facility and Work
  has been completed and complies with the Scope of Work, the Drawings, the Specifications
  and applicable Laws, and Contractor has made training available to Company’s
  personnel (or other nominees of Company);

                    (b)     
the Facility has satisfied or, pursuant to Sections 6.4.2, 6.4.3 or 6.7 is
deemed to have satisfied, the checks and tests under Exhibit D, including the
Performance Guarantee or, if the Performance Guarantee was not met, the
Performance Liquidated Damages have either been paid or agreed and shall be
deducted from the final payment of the Contract Price; 

                    (c)      any
amount finally determined due for Delay Liquidated Damages has either been paid
or agreed and shall be deducted from the final payment of the Contract Price;

                    (d)     
the list of Punchlist Items (if any) for the Facility have been identified by
Contractor and provided to Company as provided in Section 4.9; 

                    (e)      all
other deliverables identified in this Contract with respect to the Facility
(except for the As-Built Drawings or deliverables appearing in the Punchlist
Items provided by Contractor), including the O&M Manual and other documents
and materials described in Article 9, have been completed in accordance with the
provisions hereof and have been provided to Company.; and 

                    (f)      all
  rubbish accumulated by Contractor in the Company-designated disposal area has
  been removed and disposed in accordance with Section 2.2(g) .

          4.8      Final
Completion Certificate 

          Within
fifteen (15) Days following the receipt of the Certificate of Final Completion,
Company shall inspect the Facility and review all Work and services performed by
Contractor with respect thereto, and shall either (i) deliver to Contractor the
Certificate of Final Completion countersigned and certifying that the Work
requirements of this Contract (other than the Punchlist Items identified by
Contractor and the As-Built Drawings) have been fully satisfied for the Facility
and Final Completion of the Facility has accordingly been achieved, or (ii) if
reasonable cause exists for doing so, notify Contractor in writing that Final
Completion of the Facility has not been achieved, stating in detail the reasons
therefore. In the event that Company determines that Final Completion has not
been achieved and Contractor has not disputed Company’s determination,
Contractor shall promptly take such corrective action or perform such 

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additional Work or other services as shall achieve Final
Completion of the Facility and shall issue to Company another Certificate of
Final Completion. Such procedure shall be repeated until Final Completion of the
Facility has been achieved; provided, however, that Company shall respond to any
such subsequent Certificate of Final Completion within five (5) Days following
the receipt thereof. If Company fails to provide the Certificate of Final
Completion or as contemplated in (ii) above within the aforementioned period,
Final Completion of the Facility shall be deemed to have been achieved. 

          4.9      Punchlist
  

          Contractor
shall provide to Company a list of all Punchlist Items and the estimated cost
thereof prior to the issuance of the Certificate of Final Completion. Within
fifteen (15) Days following the receipt of this list of Punchlist Items, Company
shall notify Contractor in writing whether Company has any objections to that
list or the estimates thereof. If Company has any objections, including
additions, the Parties shall use good faith efforts to resolve such objections.
If no agreement can be reached, the provisions of Article 14 shall be invoked to
resolve the dispute. Two hundred percent (200%) of the estimated value of such
Work, as reasonably decided by Company, shall be retained or deducted from the
Contract Price by Company or, at Contractor’s option, paid to Company by
Contractor pending satisfactory rectification and/or completion. Contractor
shall rectify or complete to the reasonable satisfaction of Company within the
time stated in the Certificate of Final Completion any such Punchlist Items
listed. In the event Contractor fails to rectify or complete any Punchlist Items
listed, Company may arrange for the outstanding work to be done and the cost
thereof shall be certified by Company and deducted from the Contract Price or,
at Contractor’s option, paid to Company by Contractor. Upon satisfactory
rectification and/or completion of such Work, the money retained, deducted or
paid under this Section 4.9 in relation thereto shall be reimbursed to
Contractor by Company. During the period after Final Completion, Contractor and
Company shall cooperate to ensure that the performance of the Work does not
unreasonably interfere with the commercial operation of the Facility and at the
same time allowing the remaining Work to be performed in a prompt and efficient
manner. As soon as practicable after the completion of all Punchlist Items,
Contractor shall remove all of its equipment and Materials and complete the
removal of all Work-related waste material and rubbish from and around the Site.

          4.10     Failure
to Achieve Final Completion by the Guaranteed Final Completion Date

                     
4.10.1      If the Final Completion Date has not
occurred on or before the Guaranteed Final Completion Date and if the Net
Deliverable Capacity is less than the Performance Guarantee, and Contractor
elects to make corrections to the Facility and continue repeating Performance
Tests pursuant to Exhibit D, then Contractor shall be liable for liquidated
damages to the Company for the shortfall in generation in the amount calculated
as described below until such time that Contractor has performed the final
Capacity Test pursuant to Exhibit D so that there can be a determination as to
whether Performance Liquidated Damages or a Performance Bonus is payable as
provided in this Contract. 

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                      4.10.2     
  The shortfall in generation for purposes of Section 4.10.1 shall be calculated
  as the lesser of: (a) the Net Deliverable Capacity Deficiency, as defined in
  Schedule A of Exhibit D; and (b) the difference between what the Facility would
  have been able to generate and sell to Idaho Power Company had the Facility
  met the Performance Guarantee, and that which it was actually able to sell as
  a result of the Facility not meeting the Performance Guarantee. The shortfall
  in generation shall be calculated between the Guaranteed Final Completion Date
  and the actual Final Completion Date. Any shortfall generation attributable
  to the Company, whether because the Facility was unable to operate or to only
  operate at a reduce power output, shall not be included in the shortfall generation
  for which the Contractor is liable.

                    
 4.10.3      The Shortfall in Generation
liquidated damages that the Company shall be entitled to recover from
Contractor, and Contractor shall pay to Company, shall be calculated as the
shortfall in generation calculated as provided in Section 4.10.2 multiplied by
the PPA rate for the power (“Shortfall Generation Liquidated
Damages”). 

ARTICLE
5.      COMPENSATION AND PAYMENT

          5.1     
Contract Price 

                     
5.1.1      As compensation for the performance of
the Work, Company shall pay Contractor, in the manner and at the times
hereinafter specified, the Contract Price, which amount may be subject to
adjustment in accordance with the terms of this Contract. 

                     
5.1.2      The Contract Price includes any and all
Taxes imposed directly or indirectly by any Governmental Authority including
export taxes, importation duties and income Taxes imposed on Contractor, but
excludes State of Idaho and local sales and use taxes.

                   
  5.1.3      Contractor shall be
responsible for paying all State of Idaho sales and use taxes due as a result of
the Work in the construction of the Facility to the State of Idaho on behalf of
the Company. Company shall reimburse Contractor for any such taxes so paid. The
State of Idaho sales and use taxes paid by Contractor since the previous invoice
shall be stated separately and shown on all invoices as a separate line item and
shall be paid by Company to Contractor.

                     
5.1.4      Upon request of Company, Contractor
shall:

                    (a)      promptly
provide to Company evidence of its remittance to the applicable Governmental
Authority of all state and local sales and use taxes that Contractor collects
from Company under this Contract; and 

                    (b)      provide
Company with sufficient level of detail such that Company is able to claim any
State of Idaho sales and use tax refund for geothermal energy projects for which
it may be eligible under State of Idaho law. 

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          5.2      Payment
Milestones 

          Exhibit
B sets forth the payment installments payable by Company in respect of Work
performed by Contractor. The Schedule shall be used as the basis for preparation
of invoices and for payments. Any cumulative acceleration of the Milestone
Payment Schedule of more than fourteen (14) Days must reflect a reciprocal
acceleration in the Guaranteed Substantial Completion Date and the Guaranteed
Final Completion Date. 

          5.3      Payment

                     
5.3.1      Upon the completion of any of the
payment milestones described in the Schedule, Contractor shall present to
Company the invoice and any other Documents described for payment of such
milestone in the Schedule. Except as provided below in this Section 5.3,
invoices that are presented for payment shall be paid within thirty (30) Days of
Company’s receipt of such invoice. All invoices presented for payment by
Contractor to Company shall set forth the following information, the: (i)
aggregate Contract Price related committed costs for the period represented by
such invoice as provided in the Milestone Payment Schedule (“Gross Invoice
Amount”); (ii) minimum cash payment required to be paid by Company pursuant
to such invoice as provided in the Milestone Payment Schedule (“Minimum
Payment”); and (iii) aggregate payments made by Company to Contractor as of
the invoice date. Contractor agrees to forebear the requirement for payment of
the Gross Invoice Amount and shall accept payment of the Minimum Payment with
respect to such invoice; provided, that Company shall provide to Contractor a
Letter of Credit in a form, and issued by a financial institution, acceptable to
Contractor, for the: (a) aggregate of the Gross Invoice Amount less the Minimum
Payment, and (b) any outstanding balances owed to Contractor by Company in
relation to prior invoices where Company paid Contractor a Minimum Payment.

                  
   5.3.2      Within ten (10) Days
of its receipt of an invoice and such Documents, Company’s Representative shall
give written notice to Contractor of any objections that Company’s
Representative has with regard to the accomplishment of such milestone. If
Company’s Representative fails to provide such notice within such ten (10) Day
period, the milestone shall be deemed accomplished and Contractor shall be
entitled to payment. If Company’s Representative provides written notice of
objection to the accomplishment of such milestone and said Documentation within
the period described above, and the contents of Company’s Representative’s
notice is not in dispute, Contractor shall resubmit the corrected invoice and/or
Documentation, and the above-described approval process shall reapply except
that the response time shall be five (5) Days rather than ten (10) Days.

                      
5.3.3      If pursuant to Section 5.3.2, Company’s
Representative disputes any amounts invoiced by Contractor within the specified
time period, Company shall promptly pay to Contractor the undisputed amount of
such invoice in the manner provided in Section 5.3.1, and any disputed amount
that is ultimately determined to have been payable shall be paid with interest
from the date the item was payable to and including the date of payment, in
accordance with the provisions of Section 5.8. The Parties shall resolve their
differences regarding the disputed amount in accordance with the dispute
resolution procedures set forth in Article 14. 

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                    5.3.4      The
Letter of Credit will provide that Contractor is entitled to draw under the
Letter of Credit the amount of the applicable Minimum Payment upon presentation
of a certificate signed by Contractor stating that Company has failed to pay to
Contractor a Minimum Payment when due and that such payment is not subject to a
bona fide dispute subject to the dispute resolution procedures set forth in this
Contract. The Letter of Credit will also provide that Contractor is entitled to
draw the full amount of the Letter of Credit upon presentation of a certificate
signed by Contractor stating that one of the events described in Section 19.2.1
of this Contract has occurred and Company has failed to cure such default within
the time periods specified in Section 19.2.1. 

          5.4      Final
Completion Payment for the Facility 

          No
  later than thirty (30) Days after the Final Completion Date, Contractor shall
  submit to Company a statement summarizing and reconciling all previous invoices,
  payments and Changes in the Work, with respect to the Work, and a waiver of
  liens as provided in Section 5.7 from Contractor for the Facility and such other
  data as Company may reasonably request establishing payment of or surety for
  payment of such unpaid Contractor obligations. Within thirty (30) Days
  of the receipt of such statements and lien waiver, Company shall pay Contractor
  the remaining portion of the Contract Price (except with respect to amounts
  remaining to be paid by Company under the Contract for Punchlist Items and less
  any unpaid Liquidated Damages owing by Contractor). Any disputes regarding a
  final payment shall be handled in accordance with the procedure set forth in
  Article 14. 

          5.5      Payments
Not Acceptance of Work 

          No
payment made by Company to Contractor shall be considered or deemed to represent
that Company has inspected the Work or checked the quality or quantity of the
Work and shall not be deemed or construed as an approval or acceptance of any
Work or as a waiver of any claim or right Company may have hereunder. 

          5.6      Payment
of Subcontractor 

          Contractor
shall promptly pay, in accordance with the terms and conditions set forth in the
respective Subcontract, each Subcontractor the amount to which said
Subcontractor is entitled. Contractor shall, by an appropriate agreement with
each Subcontractor, require each Subcontractor to make timely payments to its
laborers, suppliers and subcontractors in a similar manner. 

          5.7      Waiver
of Liens 

          As
a condition precedent to the making of the final Milestone Payment Schedule
payment by Company hereunder, Contractor shall be required, upon request by
Company, to supply Company with a waiver and release of liens and security
interests to the extent of such payment in the form attached as Exhibit J, duly
executed by Contractor. 

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          5.8     
Interest 

          Amounts
not paid by either Party to the other when due under any provision of this
Contract, including the provisions of this Article 5, shall bear interest, from
the date payment was due to and including the date of payment, at the Delayed
Payment Rate. For the purposes of this Agreement, interest shall not accrue on
sums owed to Contractor by Company that are secured by a Letter of Credit
pursuant to Section 5.3.1. 

          5.9      Security
Interest 

          Notwithstanding
anything to the contrary herein, Contractor hereby reserves and Company hereby
grants Contractor, a purchase money security interest in the Work as security
for the due and punctual performance of all of Company’s obligations hereunder.
The security interest referred to above shall be satisfied by payment in full of
the Contract Price and any other amounts payable to Contractor hereunder.
Company hereby agrees to execute such documents to evidence and perfect such
security interest as Contractor may reasonably request from time-to-time.
Company hereby appoints each of Contractor’s officers as Company’s duly
authorized agent for the purpose of taking any and all such action, including
execution of financing statements on Form UCC-1 and other documents deemed
reasonably necessary by Contractor for the perfection and enforcement of the
security interest granted hereby. 

ARTICLE
6.      TESTING 

          6.1      General

          Development
and implementation of tests procedures shall be the responsibility of
Contractor. Contractor shall be responsible for providing all supplies required
for carrying out such tests, except to the extent heat resource, testing power
and water is required to be supplied by Company in accordance with this
Contract. Company may, at its expense, require independent calibration of any
and all instruments used by Contractor and/or supply Company’s own instruments
to be used in addition to those of Contractor. 

          6.2      Test
Procedures 

          The
Performance Tests shall be performed under normal operating conditions as
described in Exhibit D hereto and in accordance with all applicable Laws in
effect on the date thereof, and the test results shall be adjusted pursuant to
the Correction Curves for deviations from the Design Conditions and shall be
adjusted for other deviations as set forth in Exhibit D. Contractor may conduct
the Performance Tests after the Substantial Completion Date. 

          6.3     
  Notice of Testing

          Contractor
shall notify Company at least fourteen (14) Days in advance of the actual date
that Contractor shall start conducting the initial Performance Test. Company’s
Representative shall be entitled to attend at the time and place appointed and
Company shall instruct its operating personnel to follow the directions of
Contractor in connection with the performance of the Performance Tests. If
Company’s Representative fails to attend at the time and place 

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appointed for the Performance Tests, Contractor shall be
entitled to proceed with the Performance Tests in their absence. The Performance
Tests shall then be deemed to have been made in the presence of Company’s
Representative. 

          6.4      Delayed
  Tests; Deemed Completion

                   
  6.4.1      In the event that
Contractor’s conduct or completion of the Performance Tests is delayed for less
than sixty (60) Days from the date on which such test would otherwise have
commenced, been conducted or completed due to the failure of Company to fulfill
any of its obligations under this Contract, then Company shall issue a Change
Order extending the Schedule Day-for-Day for each Day of delay for those
Schedule items that are affected by the Company’s failure to fulfill its
obligations and compensating Contractor for its additional costs incurred as a
result of such delay. 

                 
    6.4.2      In the event that
Contractor’s conduct or completion of the Performance Test is delayed for thirty
(30) Days from the Substantial Completion Date due to a Company Default, then
Company shall pay to Contractor fifty percent (50%) of the payment milestone set
forth in the Milestone Payment Schedule for the Final Completion payment
milestone.

                  
   6.4.3      In the event that
Contractor’s conduct or completion of the Performance Test is delayed for sixty
(60) Days from the Substantial Completion Date due to a Company Default, then
the Facility shall then be deemed to be completed for all purposes under this
Contract, Company shall pay to Contractor the remainder of the Contract Price
less only the amounts withheld for Punchlist Items pursuant to Section 4.10 and
Final Completion shall be deemed to have occurred.

                
     6.4.4      Subject to
Section 6.4.5, prior to the commencement of the Performance Tests or, if the
Performances Tests have been delayed as provided in this Section 6.4, if and
when the events that prevented the commencement of the Performance Tests cease,
the Parties shall inspect the Facility and: 

	 	(a) 	
      if geothermal fluid and or cooling water have been run
      through any part of the Facility or the Facility has otherwise been
      operated by Company, for a cumulative period of more than two (2) weeks,
      or based on shortfall in the test results, Contractor may require that the
      parties jointly open and inspect the Facility prior to the Performance
      Tests being carried out or prior to repeating of the test as the case may
      be; and 

	 	 	
       

	 	(b) 	
      if the Facility is in good, clean and as-installed
      condition, Contractor will proceed within a reasonable period of time to
      conduct the Performance Tests not previously completed; or 

	 	 	
       

	 	(c) 	
      if the Facility is not in good, clean and as-installed
      condition, prior to the conduct of the Performance Tests, Company will
      within a reasonable period of time clean and repair the Facility (as
      Contractor reasonably deems appropriate) at Company’s expense and then
      Contractor will conduct such Performance Tests; or

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	 	(d) 	
      if the Facility can not be cleaned and/or repaired to a
      standard to enable the Performance Tests to be carried out, the testing
      protocols and requirements shall be revised accordingly to adjust for the
      constraints which prevent such tests from being performed as originally
      defined and within a reasonable period of time Contractor shall conduct
      such revised Performance Tests. 

Subject to the foregoing, such Performance Test(s) shall be
conducted in accordance with the terms of this Contract and the results of the
final Capacity Test conducted during such period, if any, shall be subject to
the payment of Net Performance Liquidated Damages or Performance Bonus in
accordance with the terms set forth in Article 11. Contractor shall be paid all
additional costs and expenses, if any, from those costs and expenses anticipated
in the Contract Price that arise directly from such prevention and delay,
including without limitation those costs and expenses reasonably incurred for
demobilization and remobilization and increased costs and expenses incurred for
rescheduling of the testing. 

                     
  6.4.5      Subject to extension as provided elsewhere
  in this Agreement, Contractor’s obligations under this Section 6.4 shall
  cease one hundred eighty (180) Days from the Substantial Completion Date if
  Contractor has not been able to commence the Performance Tests before the end
  of that period.

          6.5      Facilities

          Except
as expressly set forth in Section 3.1, Section 6.3 and the Scope of Work,
Contractor shall be responsible for the provision of all necessary labor,
supervision, consumables, materials and equipment necessary to carry out
properly the Performance Tests. 

          6.6      Repeat
Performance Tests 

          The
terms governing the repetition of the Performance Tests are provided in Exhibit
D, Section 4. 

          6.7      Certification
or Disagreement as to Test Results 

          The
terms governing the certification of the Performance Tests and resolution of
disputes thereof pursuant to Article 14 of the Contract are provided in Exhibit
D, Section 6. 

ARTICLE
7.      INTENTIONALLY OMITTED

ARTICLE
8.      CONSTRUCTION SUSPENSION
AND ACCELERATION; CHANGE ORDER 

          8.1      Construction
Suspension and Acceleration 

                  
   8.1.1      Company may order
Contractor to suspend the Work, or any part thereof, for such a time and in such
a manner as Company may consider necessary or desirable. Contractor, during
such a suspension, shall properly protect and secure the Work, or such part 

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thereof, so far as is necessary in the opinion of Company. In
the event of such order to suspend the Work, or any part thereof, and such
suspension is not the result of a Contractor default, Contractor shall be
entitled to a Change Order for adjustments pursuant to this Article 8 in the
Contract Price and the Schedule (including the Guaranteed Substantial Completion
Date and the Guaranteed Final Completion Date) as may be affected by such
suspension. 

                
       8.1.2      Company
  may order Contractor to accelerate the progress of the Work, or any part thereof,
  for such a time and in such a manner as Company may consider necessary or desirable
  provided that such acceleration is reasonably practicable. In the event of such
  order to accelerate the Work, or any part thereof, and such acceleration is
  not the result of Contractor’s default, Contractor shall be entitled to
  a Change Order for adjustments pursuant to this Article 8 in the Contract Price
  as may be affected by such acceleration.

          8.2      Change
Orders 

          Company,
without invalidating this Contract, may order Change in the Work that are
reasonably related to and do not materially reduce or increase the Scope of
Work, in which event one or more of the Contract Price, the Schedule (including
the Guaranteed Substantial Completion Date and the Guaranteed Final Completion
Date) and other such parts of the Contract as may be affected by such Change in
the Work shall be adjusted as necessary. If Company decides not to issue a
Change Order after having requested a Change in the Work, unless such Change
Order request is issued in response to a Contractor Change Order notice as set
forth in Section 8.3.2, Contractor shall be entitled to reasonable compensation
for providing engineering services necessary to respond to Company’s Change
Order request. Such reasonable compensation is defined to mean Contractor’s
actual direct cost of providing such engineering services plus a fifteen percent
(15%) mark-up for overhead and profit. All Changes in the Work shall be
authorized by a Change Order and only Company or Company’s Representative may
issue Change Orders. 

          8.3      Procedure
for Change Orders. 

                     
8.3.1      As soon as reasonably possible, but in
no event later than fourteen (14) Days after Contractor becomes aware, through
the exercise of reasonable diligence, of any circumstances which Contractor has
reason to believe may constitute a Change in the Work, Contractor shall issue to
Company a Change Order notice using the Change Order Request form set forth in
Exhibit M. All Change Order notices shall include preliminary documentation
sufficient to enable Company to determine (i) the factors necessitating the
possibility of a Change Order; (ii) the impact which the Change Order is likely
to have on the Contract Price; and (iii) the impact which the Change Order is
likely to have on the Schedule (including the Guaranteed Substantial Completion
Date and the Guaranteed Final Completion Date). Failure to give such proper and
timely Change Order notice shall, to the extent Company is prejudiced by such
failure, constitute a waiver of Contractors right to an adjustment.

                    
 8.3.2      If Company desires to make a Change
Order in response to a Change Order notice, it shall submit a Change Order
request to Contractor using the Change Order Request form set forth in Exhibit
M. Contractor shall promptly review the Change Order request and notify Company
promptly in writing of the options for implementing the proposed Change 

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Order (including, if possible, any option that does not involve
an extension of time) and the effect, if any, each such option would have on the
Contract Price, the Schedule (including the Guaranteed Substantial Completion
Date and the Guaranteed Final Completion Date), or any other such part of the
Contract as may be affected. The preparation and provision of information to
Company in response to a Change Order request shall be at Contractor’s expense
if such Change Order request is issued in response to a Change Order notice
issued by Contractor pursuant to this Section 8.3.2 and otherwise Contractor
shall be reimbursed for such expense as provided in Section 8.2. 

                  
   8.3.3      If Company agrees that a
Change Order is in order and accepts Contractor’s statement of the effect of
such Change Order on any one or more of the Contract Price, the Schedule
(including the Guaranteed Substantial Completion Date and the Guaranteed Final
Completion Date), or any other such part of the Contract as may be affected,
Company shall issue a Change Order. In the event Company disagrees with
Contractor’s statement of the effect of such Change Order on any one or more of
the Contract Price, the Schedule (including the Guaranteed Substantial
Completion Date and the Guaranteed Final Completion Date), or any other such
part of the Contract as may be affected, Company may proceed to issue the Change
Order in accordance with Section 8.8.

          8.4      Change
Orders Due to Contractor Error 

          Except
as provided in Sections 8.5, 8.6 or 8.7, no Change Order shall be issued and no
adjustment of any one or more of the Contract Price or the Schedule (including
the Guaranteed Substantial Completion Date and the Guaranteed Final Completion
Date) shall be made to the extent resulting from any delay, failure of
performance, correction of errors, and flaws or errors in design, omissions,
deficiencies or improper or defective Work, machinery, equipment, materials,
systems, supplies or other items on the part of Contractor or any Subcontractor
in the performance of the Work or provisions of, or delay in provisions of
Materials or other items of the Work where such delay was within the reasonable
control of Contractor or any Subcontractor, or any failure of Contractor or any
Subcontractor to comply with the Contract. To the extent any delay or failure of
performance was concurrently caused by Company and Contractor, Contractor shall
be entitled to an adjustment of the Schedule (including the Guaranteed
Substantial Completion Date and the Guaranteed Final Completion Date) for that
portion of the delay or failure of performance that was concurrently caused, but
Contractor shall not be entitled to any adjustment of Contract Price for such
concurrent delay. 

          8.5      Change
Orders Due to Changes in Law 

          Any
Change in the Work necessitated by any Change of Law enacted after the Effective
Date (excluding therefrom any change in applicable Law relating to taxation of
Contractor’s income) shall be treated as a Change Order under Section 8.3. 

          8.6      Effect
of Force Majeure; Excused Performance 

          If
Contractor’s performance hereunder is wholly or partially prevented due to the
occurrence of a Force Majeure affecting Contractor and such Force Majeure has
caused an extension of the Guaranteed Substantial Completion Date or any other
date under the Schedule, 

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Contractor shall provide to Company a written description of
Contractor’s plan to make-up Days lost under the Schedule due to the occurrence
of such Force Majeure, including an estimate of the costs of such plan. In the
event of the occurrence of a Force Majeure, Contractor shall be entitled to a
Change Order for adjustments pursuant to this Article 8 in the Schedule
(including the Guaranteed Substantial Completion Date and the Guaranteed Final
Completion Date) and other such parts of the Contract as may be affected by such
Force Majeure; provided, however, that there shall be no adjustment in the
Contract Price for the first two (2) events of Force Majeure declared by a Party
or any event of Force Majeure that arises from a failure of Contractor’s vendor,
Ormat Systems Ltd., to timely perform its obligations that are being performed
outside of the United States of America under its OEC supply agreement with
Contractor. To the extent that Company desires to pay for the costs of
acceleration of the Work or change to the Schedule (including the Guaranteed
Substantial Completion Date and the Guaranteed Final Completion Date) set forth
in Contractor’s proposal in order to compensate for delays in the work caused by
such Force Majeure, Company shall authorize a Change Order increasing the
Contract Price and adjusting the Schedule (in addition to any automatic
adjustments of the Guaranteed Substantial Completion Date). To the extent
Contractor (a) is compensated for the effect of a Force Majeure by insurance
maintained pursuant to this Contract, or (b) would have been so compensated, but
for Contractor’s failure to provide such insurance as required under this
Contract, Contractor shall not be entitled to a Change Order to the Contract
Price in connection with such Change Order issued for such Force Majeure. Except
for the obligations of either Party to make any required payment then due and
owing under this Contract, if either Party is rendered wholly or partially
unable to perform its obligations under this Contract because of a Force
Majeure, then such Party’s obligations that are so affected shall be excused and
suspended to the extent and during the continuance of the Force Majeure. If the
Force Majeure continues for six (6) consecutive months or more, this Contract
may be terminated by either Party pursuant to Section 19.3. This Section 8.6 is
subject to and conditioned upon the following:

                    (a)      the
non-performing Party, by exercise of due foresight, could not reasonably have
been expected to avoid, or that by the exercise of reasonable due diligence
could not have been able to overcome, such Force Majeure; 

                    (b)      the
non-performing Party gives the other Party notice describing the particulars of
the occurrence, with notice given promptly after the occurrence of the Force
Majeure, and in no event more than fifteen (15) Days after the affected Party
becomes aware of such occurrence; within thirty (30) Days after such occurrence,
the non-performing Party shall give the other Party written notice estimating
the expected duration and probable impact on the performance of such Party’s
obligations hereunder, and continues to furnish timely regular reports with
respect thereto during the continuation of the Force Majeure; 

                    (c)      the
non-performing Party shall forecast the duration of its non-performance,
provided that it shall be no more than is reasonably required by the Force
Majeure; 

                    (d)      the
non-performing Party shall exercise all reasonable efforts to mitigate or limit
damages to the other Party; 

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                    (e)      the
non-performing Party shall exercise all reasonable efforts to continue to
perform its obligations hereunder and to correct or cure the event or condition
excusing performance; and 

                    (f)      when
the non-performing Party is able to resume performance of its obligations under
this Contract, that Party shall give the other Party written notice to that
effect and shall promptly resume performance hereunder. 

          8.7      Company-Caused
Changes 

          In
the event and to the extent (a) a failure of Company to perform, or cause
performance of, its obligations in accordance with the Contract; or (b) damage
to or destruction of any Work caused by Company cause a delay in Contractor’s
performance of the Work which impairs Contractor’s ability to meet the Schedule,
or impacts Contractor’s cost of performance of the Work, an equitable adjustment
in the Schedule (including the Guaranteed Substantial Completion Date and the
Guaranteed Final Completion Date) or the Contract Price or any other such part
of this Contract as may be affected shall be made pursuant to this Article 8. To
the extent Contractor cannot reasonably redeploy labor or equipment, reasonable
standby and mobilization/remobilization costs incurred by Contractor resulting
from any such delay shall be reimbursed to Contractor monthly as such costs are
incurred. 

          8.8      Price
Change 

                  
   8.8.1      An increase or
decrease in Contract Price, if any, required pursuant to this Article 8 as a
result of a Change Order shall be determined by the mutual agreement of the
Parties, and shall be paid (or reimbursed) in one or more payments in accordance
with the following: 

                    
(a)      as a fixed price lump-sum, in an amount
proposed by Contractor (properly itemized and supported by sufficient
substantiating data to permit evaluation) and accepted by Company; or 

                    
  (b)      if the method set forth in Section 8.1(a)
  is not agreed upon by the Parties, Contractor shall perform the Work on a time
  and material basis.

                
8.8.2      Change Order Pricing – Time and
Material Prices. 

                    (a)      Whenever
Company authorizes Contractor to perform Work contemplated under a Change Order
on a time and material basis, Company’s authorization shall clearly state: 

                              (i).      scope
of Work to be performed; and 

                              (ii).     type
of reimbursement including pre-agreed rates, if any, for material quantities or
labor. 

                    (b)      Contractor
shall: 

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                              (i).      cooperate
with Company and assist in monitoring the Work being performed. As requested by
Company, identify workers assigned to the Work and areas in which they are
working; 

                              (ii).     identify
on daily time sheets all labor, equipment and materials furnished in accordance
with this authorization. Submit copies of daily time sheets within two (2) Days
for Company’s review; 

                              (iii).    leave
access as appropriate for quantity measurement; 

                              (iv).  
efficiently perform all Work in accordance with this Section 8.8.2; 

                              (v).   
not be required to perform time and material work past the established not to
exceed limit(s) without Company’s prior written approval. 

                              (vi).  
Submit costs in accordance with Section 8.8.1, plus profit and overhead of
fifteen percent (15%) on the sum of such costs and additional verification
supported by: 

                                        (1)      labor
priced at Contractor’s then current burdened direct labor rates, detailed on
daily time sheets; 

                                        (2)      invoices
for equipment and material; and 

                                        (3)      invoices
for construction equipment rental costs. 

          8.9      Effectiveness;
Continued Performance Pending Resolution of Disputes 

          If
a Change in the Work is initiated under this Article 8, then the Change Order
and the modifications made pursuant to such Change Order shall be effective upon
Company’s issuance of a Change Order with respect thereto. Notwithstanding a
dispute regarding any proposed or requested Change Order, or any adjustment of
one or more of the Contract Price, the Schedule (including the Guaranteed
Substantial Completion Date and the Guaranteed Final Completion Date), or any
other such part of this Contract as may be affected with respect to a Change
Order, Contractor shall proceed with the performance of such Change Order
promptly following Company’s execution of the corresponding Change Order. 

          8.10      Documentation

          All
claims by Contractor for adjustments pursuant to a Change Order to one or more
of the Contract Price, the Schedule (including the Guaranteed Substantial
Completion Date and the Guaranteed Final Completion Date), or any other such
part of this Contract as may be affected as a result of Change Orders under this
Article 8 shall be supported by such documentation as is reasonably sufficient
for Company to determine the accuracy thereof. Within thirty (30) Days of
Contractor’s knowledge of Contractor’s need to provide additional supporting
data for the 

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Change Order notice, unless Company agrees in writing to allow
  an additional period of time to ascertain more accurate data, Contractor shall
  supplement the Change Order notice with additional supporting data. Such additional
  data shall include, to the extent known, or through the exercise of reasonable
  diligence should be known at the time, at a minimum (a) the amount of compensation
  or delay claimed, itemized in accordance with procedures set forth herein; (b)
  specific facts, circumstances; (c) analysis that confirms not only that Contractor
  suffered the damages or delay claimed, but that the damages or delay claimed
  were actually a result of the act, event, or condition complained of, and that
  the Contract provides entitlement to an equitable adjustment in Contract Price
  or Schedule (including the Guaranteed Substantial Completion Date and the Guaranteed
  Final Completion Date) for such act, event or condition; and (d) supporting
  documentation sufficiently detailed to permit an informed analysis of the request
  by Company. Failure to provide such additional information and documentation,
  to the extent such information and documentation was reasonably available to
  Contractor, within the time allowed or within the format required shall, to
  the extent Company’s interests are prejudiced, constitute a waiver of Contractor’s
  right to an adjustment.

          8.11      Continue
Work 

          Pending
final resolution of any request in accordance with this Article 8, unless
otherwise agreed in writing, Contractor shall proceed diligently with
performance of the Work. 

          8.12      Critical
Path Schedule Updates 

          If
there is any change in the Schedule covered by a Change Order, or based on a
Change Order notice, Contractor shall provide Company with an updated version of
Contractor’s critical path schedule reflecting the change attributable to the
Change Order or event(s) giving rise to the request for adjustment. 

          8.13      Change
Order Constitutes Complete Relief 

          Except
for aggregate impacts which are either unknown, or despite the exercise of
reasonable diligence would not be known at the time of execution of a Change
Order, any Change Order signed by Company and Contractor shall constitute full
compensation to Contractor for all claims for cost for direct, indirect, labor,
temporary construction failures, job site, or home office overhead, stacking of
trades, inefficiencies, impacts or any other cost of any kind or nature; and in
the event the Change Order adjusts the Schedule, the Change Order signed by
Company and Contractor constitutes complete relief to Contractor for schedule
impacts for all events giving rise to the Change Order. 

          8.14      Effect
of Changes on Warranties and Safety 

          8.14.1
If Contractor reasonably believes that a proposed Change in the Work may
negatively affect any warranty or performance commitments with regard to any
Work, Contractor shall serve Company notice within fourteen (14) Days of
Contractor’s receipt of such proposal of its belief and the believed effect. If
Company insists, despite Contractor’s notice, upon requiring the execution of
such proposal and Contractor acquiesces to Company’s request and executes the
proposal, the affected warranties or performance commitments shall be adjusted

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to the extent agreed between the Parties or as already determined
  in accordance with the provisions of Article 14, but only to the extent related
  to or derived from Company’s proposal.

                 
    8.14.2      If Contractor
reasonably believes that a proposed Change in the Work may negatively affect
safety of the Work or persons in its vicinity or would violate any applicable
Laws, Contractor shall serve Company notice within fourteen (14) Days of
Contractor’s receipt of such proposal of Contractor’s belief and the believed
effect, and Contractor shall not be required to perform such proposal.

ARTICLE
9.      DESIGN AND DOCUMENTATION

          9.1      Ownership
of and Responsibility for Design 

                
     9.1.1      Contractor
retains legal title to and ownership of the design and engineering of the
Facility and Contractor remains entitled to freely use, modify, license or
otherwise dispose of the same at its discretion without any obligation to
account to Company. 

                 
      9.1.2      Contractor
  shall be responsible for the development of the technical data (other than the
  technical interface data which is being developed and provided by Company),
  design and other documentation required for the performance of the Work.
  

          9.2      Inspection
of Work 

          At
Company’s sole expense, Company and Company’s Representative shall have
the right to inspect any item of the Work to be provided hereunder. Company and
Company’s Representative shall have access to those portions of the Site then
under Contractor’s control, at reasonable times and upon reasonable notice.
While at the Site, Company and the Company’s Representative shall comply with
all of Contractor’s safety rules and other job site rules and regulations. 

          9.3      As-Built
Drawings 

          Within
three (3) months following the Final Completion Date, Contractor shall furnish
to Company two (2) reproducible sets of full sized construction drawings of the
Facility on which are marked any and all material deviations from those Drawings
that were issued for construction (“As-Built Drawings”). In addition,
Contractor shall provide a complete set of the “As-Built” Drawings in electronic
media compatible with AutoCAD – Release 2002 or newer, or substitute as approved
by Company. 

          9.4      License
to Use 

          Subject
to Section 9.1.1, Company shall have a non-exclusive, transferable
license and right to use and reproduce all Drawings, Specifications, Facility
manuals and any other Documents provided or to be provided by Contractor
hereunder, including the O&M Manual for the Facility and the reproducible
Drawings furnished by Contractor pursuant to Section 9.3, solely for the purpose
of operating, maintaining and repairing the Facility. Company shall not use any
such Documents for any other purpose. 

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          9.5      Use
of Documents After Termination 

          If
this Contract is terminated by Company pursuant to Section 19.1 prior to
completion of the Facility, Company may, in its sole discretion, use any
Drawings, Specifications, Facility manuals or other Documents prepared hereunder
solely for the purpose of completing the Facility. If this Contract is
terminated by Contractor and full payment of the Contract Price is not received,
Company shall not be entitled to use or continue using the documents thereafter.

          9.6      O&M
Manual 

          At
least sixty (60) Days prior to the start-up of the Facility or any portion
thereof, Contractor shall deliver to Company four (4) copies of the preliminary
draft of the O&M Manual for the Facility as provided in the Scope of Work.
The O&M Manual shall include the information for that manual described in
the Scope of Work. Such preliminary draft shall be as reasonably complete as
available information shall allow and at a minimum with sufficient information
to permit the training of Company’s operation and maintenance personnel and the
normal operation and maintenance of the Facility by persons generally familiar
with facilities and plants similar to the Facility. Contractor thereafter shall
provide to Company four (4) copies of the final and complete O&M Manual for
the Facility prior to Final Completion. 

ARTICLE
10.      WARRANTIES 

          10.1      Warranty

          Contractor
warrants to Company that: 

                    (a)      the
Work shall conform in all material respects to the Drawings, the Specifications
and the other requirements set forth in this Contract; 

                    (b)      the
Work shall be of good quality, free from any Defect and shall be performed in a
workmanlike and skilful manner; 

                    (c)      the
equipment and all Materials and other items incorporated in the Work shall: 

                              (i)      be
new and shall be of a suitable grade of its respective kind for its intended
use;

                              (ii)    
be free from any Defect; 

                              (iii)   
meet the requirements of this Contract; 

                              (iv)   
be free from any charge, encumbrance, lien or other security interest; and 

                              (v)     comply
with current applicable Laws. 

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                    (d)      title
  and ownership to the Work shall pass to and vest in Company, as described in
  Section 12.1, free and clear of any and all liens, claims, charges, security
  interests, encumbrances and rights of other persons arising as a result of any
  actions or failure to act of Contractor, its Subcontractors, or their employees
  or representatives; and

                    (e)      the
Work has been and shall be designed and engineered with all the skill, care and
diligence to be expected of appropriately qualified and experienced professional
designers and engineers with experience in carrying out works of a similar,
type, nature and complexity to the Work. 

          10.2      Warranty
Period

          The
warranties set forth in Section 10.1 shall extend for a period of twelve (12)
Months from the Final Completion Date; provided, however, that such period with
respect to any item of the Work that is repaired, replaced, modified, or
otherwise altered by Contractor pursuant to Section 10.3 shall be extended for
twelve (12) Months from the date of completion of such repair, replacement,
modification or alteration, but in no event shall such period exceed twenty-four
(24) Months from the Final Completion Date for the subject item of the Work (for
such item, the “Warranty Period”). Upon the expiration of the Warranty
Period, Contractor will assign to Company, to the extent assignable, the
warranties relating to the Work from any Subcontractors or vendors that extend
beyond the Warranty Period, if any. 

          10.3      Defect
Remedy Work 

                      
10.3.1      Company shall notify Contractor
promptly (but not longer than forty-eight (48) hours) upon discovery of any
Defect. A written “failure report,” which includes available technical and
logistic information to assist Contractor to assess the damage to the equipment
and to evaluate appropriate corrective action, shall be provided to Contractor
as soon as reasonably practicable upon discovery of the Defect. If Contractor
requests, Company shall supply all relevant information relating to past
maintenance, repair and operational data relating to the failed Work.

                 
     10.3.2      Contractor’s
responsibility for any such warranty claim shall be limited to Contractor’s
performance of Defect Remedy Work on the Defect and Contractor shall perform
such Defect Remedy Work as soon as reasonably possible following Contractor’s
receipt of notice and the relevant failure report from Company
applicable to such Work. Only direct costs and expenses of Defect Remedy Work
shall be borne by Contractor. Contractor shall have the obligation in connection
with the performance of any Defect Remedy Work to provide any special rigging,
cranes or heavy equipment or any labor required in connection with operating
such equipment, except where such items or labor are readily available at the
Site, in which case such items or labor shall be provided by Company or
Company’s operator, at Contractor’s request, and Contractor shall pay reasonable
compensation therefore. 

                   
   10.3.3      All costs associated
with the performance of any repair and maintenance work which is not Defect
Remedy Work, including the costs of the replacement of any parts or other
portions of the Work which are not defective but which are replaced in
conjunction with Defect Remedy Work at the request of Company, shall be the
responsibility of Company.

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Company shall provide Contractor with access to the Facility
  and to utilities, tools and equipment available at the Site for Contractor’s
  performance of any Defect Remedy Work. If Contractor elects not to carry out
  such Defect Remedy Work and requests Company to perform the same under this
  Article 10 instead of Contractor, Company may cause the Defect Remedy Work to
  be effected and Contractor shall reimburse Company the costs Company has reasonably
  incurred as a result. 

                 
       10.3.4      The
  warranty and the liabilities and obligations of Contractor under this Contract
  shall not extend to replacement of normal consumables or apply to any failure
  to comply with the warranty that has been caused by (i) any erosion or derosion
  or normal wear and tear in operation of the subject Work; (ii) any failure of
  Company or a third party, other than Contractor or Subcontractor, to properly
  store, install, operate and/or maintain the subject Work in accordance with
  good industry practices and the O&M Manual; (iii) any modifications made
  to the subject Work by any person other than personnel of Contractor or Subcontractor
  without Contractor’s express written consent prior to such modifications;
  (iv) any neglect, abuse, malicious mischief, vandalism or event of Force Majeure
  (other than a warranty failure) affecting the subject Work; (v) any other negligent
  act of Company or Company’s operator; (vi) operation of the Facilities
  under conditions (including composition of the geothermal fluid) outside of
  the range specified in the Design Conditions; or (vii) operation of the Facility,
  other than by personnel of Contractor or Subcontractor, without Contractor’s
  prior express written consent, outside the Facility’s defined operation
  range. 

          10.4      Implementation
of Warranty 

          The
warranty claims and related Work shall be implemented in accordance with the
Warranty Claim Procedures in Exhibit E.

          10.5      Disclaimer
and Release 

          THE
WARRANTIES, CONDITIONS, OBLIGATION AND LIABILITIES OF CONTRACTOR AND RIGHTS AND
REMEDIES OF COMPANY SET FORTH IN THIS CONTRACT ARE EXCLUSIVE AND IN SUBSTITUTION
FOR, AND COMPANY HEREBY WAIVES, RELEASES AND RENOUNCES, ALL OTHER PRESENT AND
FUTURE WARRANTIES, CONDITIONS, OBLIGATIONS, REPRESENTATIONS AND LIABILITIES OF
CONTRACTOR, TOGETHER WITH ALL OTHER RIGHTS, CLAIMS AND REMEDIES OF COMPANY
AGAINST CONTRACTOR, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, INCLUDING,
BUT NOT LIMITED TO, (A) ANY IMPLIED WARRANTY OR CONDITION OF MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE; (B) ANY IMPLIED WARRANTY OR CONDITION
ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE; (C) ANY
OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT, WHETHER OR NOT ARISING
FROM THE NEGLIGENCE OF CONTRACTOR OR ITS SUBCONTRACTORS, ACTUAL, PASSIVE OR
IMPUTED; OR (D) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY FOR LOSS OF OR
DAMAGE TO THE FACILITY, WORK OR ANY 

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PORTION THEREOF OR FOR ANY INCIDENTAL OR CONSEQUENTIAL
DAMAGES. 

ARTICLE
11.      PERFORMANCE AND
PERFORMANCE RELATED REMEDIES; EXCLUSIVITY; LIMITATION OF LIABILITY

          11.1      Performance
Liquidated Damages and Performance Bonus

                      
11.1.1      In the event that, upon completion of
the Capacity Test, the Net Deliverable Capacity result is less than the
Performance Guarantee, Contractor shall have the option for the period specified
in Exhibit D to undertake any necessary actions to increase the Net Deliverable
Capacity of the Facility to satisfy the Performance Guarantee at its own cost.
If, upon the expiration of such period, the Net Deliverable Capacity of the
Facility as determined by the last Capacity Test is below such Performance
Guarantee, then Contractor shall, within thirty (30) Days, pay to Company as
liquidated damages, and not as penalty, the amounts set forth in Section 3 of
Exhibit K (“Performance Liquidated Damages”); provided, however, that if
Contractor has made any payments of Shortfall Generation Liquidated Damages to
Company pursuant to Section 4.10, Contractor shall be obligated to only pay Net
Performance Liquidated Damages to Company. 

                  
    11.1.2      Notwithstanding
anything to the contrary herein, Performance Liquidated Damages as provided in
this Section 11.1 or the payments described in Section 4.10 shall not be payable
if failure to achieve the Performance Guarantee is due to Force Majeure, Company
Default or any other reason not attributable to Contractor. 

                 
       11.1.3      If the Facility,
  as determined by the last Capacity Test, exceeds the Performance Guarantee in
  respect of Net Deliverable Capacity, Company shall pay Contractor within
  thirty (30) Days of Contractor’s invoice, as a bonus and in addition to
  the Contract Price, the amounts set forth in Section 4 of Exhibit K (“Performance
  Bonus”).

          11.2
Exclusivity 

          The
Liquidated Damages payable under this Contract shall, without duplication, be
the sole and exclusive remedy and measure of damages with respect to any delay
in completion of the Facility or any failure to meet the Performance Guarantee.
Once payment of Liquidated Damages and other amounts has been made, or the
limits set forth in Section 11.5 have been met, and Contractor has performed all
other Work required hereunder with respect to the Facility, Contractor shall be
relieved of any further Liability with respect to such failures. 

          11.3      General
Limitation of Liability 

                      
11.3.1      Notwithstanding any other provision to
this Contract, Contractor’s maximum aggregate Liability under this Contract
(including for Liquidated Damages) from any and all causes shall in no case
exceed the sum of: the lower of one hundred percent (100%) of the Contract Price
(as the same may be adjusted in accordance with this Contract) or one hundred
percent (100%) of the amount of the actual payments for the Work received by
Contractor hereunder. 

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       11.3.2      Except
  to the extent of the Liquidated Damages, Performance Bonus, Schedule Bonus or
  the termination payments described in Article 19, in no event shall either Party
  be liable to the other for any indirect, special, incidental, consequential
  or exemplary damages (which includes loss of profit, revenues or savings), or
  for costs of procurement of substitute goods whether arising in contract, equity,
  tort, or other basis for Liability, even if it has been advised of the possibility
  of such damages.

                      
11.3.3      The foregoing limitations on Liability
in this Section 11.3 shall: 

                    (a)      not
limit Company’s right to receive proceeds of Contractor’s insurance required to
be maintained pursuant to Article 13 of this Contract; 

                    (b)      not
apply to limit, nor shall they include, the costs of Contractor’s or Company’s
indemnification obligations under Article 15; or 

                    (c)      exclude
any Liability of Contractor or Company stemming from the fraud or willful
misconduct of Contractor, any Subcontractor, or their respective employees or
Company or its employees, respectively. 

          11.4     
Other Provisions 

          The
Parties acknowledge and agree that because of the unique nature of the Facility
and the unavailability of substitute facilities, it is difficult or impossible
to determine with precision the amount of damages that would or might be
incurred by Company as a result of Contractor’s failure to complete the Work so
that Substantial Completion is accomplished by the Guaranteed Final Completion
Date and the Facility is completed by the Guaranteed Final Completion Date or so
that the Facility meets the Performance Guarantee. It is understood and agreed
by the Parties that Company shall be damaged by the failure of Contractor to
meet such obligations and that (i) it would be impracticable or extremely
difficult to fix the actual damages resulting therefrom; (ii) any Liquidated
Damages that are payable under this Contract are in the nature of liquidated
damages, and not a penalty, and are fair and reasonable; and (iii) such payments
represent a reasonable estimate of fair compensation to Company for the losses
that may reasonably be anticipated from such failure. The Parties hereby
acknowledge that Section 4.6, Section 4.10 and this Article 11 represent a
reasonable allocation of risk. 

ARTICLE
12.      TITLE; CARE OF THE WORK

          12.1      Passage
of Title 

          Subject
to the provisions of Sections 9.1.1 and 9.4, legal title to and ownership of all
Work and Materials provided hereunder shall pass to and vest in Company the
later of (i) delivery to the Site; or (ii) upon payment of the respective
milestone payment pursuant to the Milestone Payment Schedule. 

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          12.2     
Risk of Loss 

          Contractor
shall be responsible to assure safe delivery of all Materials to the Site.
Except to the extent caused by the negligence or willful misconduct of Company,
Contractor shall bear the risk of physical loss or destruction of or damage to
the Materials and the Work, whether or not incorporated in the Facility at the
Site or located on or off the Site, until the Substantial Completion Date.
Notwithstanding the passage of title as provided in Section 12.1, Contractor
assumes the risk of loss with respect to, and shall be obligated to replace,
repair or reconstruct, any portion or all of the Materials or the Work that is
lost, damaged or destroyed prior to turning over care, custody and control of
such Material or Work to Company as provided in this Contract, irrespective of
how such loss, damage or destruction shall have occurred. In the event of a
termination of this Contract in accordance with the provisions hereof prior to
such turnover, the risk of loss with respect to such Materials and Work shall
pass to Company upon the effective date of termination, whether by Company or by
Contractor. 

          12.3      Care,
Custody and Control 

          Upon
the Substantial Completion Date, Contractor shall turn over to Company the care,
custody and control of the Facility. Company, at its expense, shall properly
operate and maintain such portions of the Facility turned over to it by
Contractor in accordance with applicable Laws, Prudent Industry Practices, the
O&M Manual and the instructions and specific recommendations provided by
Contractor to Company. Contractor may conduct periodic inspections of the
turned-over equipment to ensure that Company is complying with such obligations.
It is further acknowledged and agreed that Company shall provide Contractor, at
all times, free and clear access to the Facility in order to allow Contractor to
perform its obligations under the Contract (including completion and/or
repetition of testing, Punchlist Items and warranties). 

ARTICLE
13.      INSURANCE 

          13.1      Contractor
Provided Insurance 

          Contractor
shall: 

                    (a)      obtain
  and maintain in full force and effect from the Commencement Date through Final
  Completion, at its own cost, the following policies of insurance: 

  
               (i)      Builders
      All Risk insurance in an amount equal to cover the replacement cost of the
      Facility, including transit coverage for purchased plant and equipment;
    

               (ii)      Public
      Liability insurance with bodily injury and property damage combined single
      limits of at least One Million Dollars ($1,000,000) per occurrence and Two
      Million Dollars ($2,000,000) in the aggregate. Such insurance shall cover
      liability for bodily injury to third parties or damage to property to third
      parties arising in connection with the performance of the Work; 

  

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               (iii)      Excess
      Liability insurance with a single limit of at least Five Million Dollars
      ($5,000,000) per occurrence in excess of the limits of the insurance provided
      in paragraph (ii) above;

              (iv)     
      Workers Compensation insurance providing statutory limits of liability,
      and Employers Liability limits of One Million Dollars ($1,000,000) per disease/accident/
      employee, covering Contractor; and

              (v)     
      Marine transit insurance for Materials and/or Equipment procured and to
      be delivered pursuant to this Contract and to provide that Company is named
      as the additional named insured; and 

  

                    (b)      procure
  and maintain such further coverages as Contractor is required to have by any
  applicable Law.

In the event this insurance or any portion of it becomes
commercially unavailable, Company and Contractor shall cooperate to obtain such
replacement insurance as may be available and this Contract shall be modified
accordingly. 

13.2 Company Provided Insurance 

Company shall: 

                    (a)      obtain
  and maintain in full force and effect, at its own cost, the following policies
  of insurance:

  
              (i)      All
      risks property insurance with a limit in an amount not less than the replacement
      cost of the Facility plant and equipment the care, custody and control of
      which has been turned over to Company by Contractor pursuant to this Contract;
    

              (ii)      Public
      Liability insurance with bodily injury and property damage combined single
      limits of at least One Million Dollars ($1,000,000) per occurrence and Two
      Million Dollars ($2,000,000) in the aggregate. Such insurance shall cover
      liability for bodily injury to third parties or damage to property to third
      parties arising in connection with the Site or the Facility; and 

              (iii)      Excess
      Liability insurance with a single limit of at least Ten Million Dollars
      ($10,000,000) per occurrence in excess of the limits of the insurance provided
      in paragraph (ii) above; and

  

                    (b)      procure
  and maintain such further coverages as Company is required to have by any applicable
  Law.

In the event this insurance or any portion of it becomes
commercially unavailable, Company and Contractor shall cooperate to obtain such
replacement insurance as may be available and this Contract shall be modified
accordingly. 

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          13.3      Policies

                      
13.3.1      Contractor’s insurance shall:

                    (a)      name
Company and its directors, officers, representatives, employees and agents and
any identified Financing Parties as additional insureds;

                    (b)      include
the following cross-liability clause: 

“Where more than one party comprises
  the “Insured,” each of the parties shall, for the purpose of such
  insurance, be considered as a separate and distinct unit/entity, and the words
  “the Insured” shall be considered as applying to each party in the
  same manner as if a separate policy has been issued to each of the said parties.
  The insurer shall provide indemnity to each in the same manner and to the same
  extent as if a separate policy has been issued to each, provided that the total
  amount payable in respect of compensation shall not exceed the limits of indemnity”;

                    (c)      provide
that such Contractor’s insurance may not be cancelled, non-renewed or materially
changed by the insurer without giving thirty (30) Days’ prior written notice to
Company; 

                    (d)      waive
any and all rights of subrogation against Company and its respective directors,
officers, representatives, agents and employees, and waive any other right of
the insurers to any offset or counterclaim or any other deduction, whether by
attachment or otherwise, in respect of any Liability of Company or its
directors, officers, representatives, agents and employees; and 

                    (e)      provide
  that any other insurance maintained by Company and its respective directors,
  officers, representatives, agents and employees is in excess of such Contractor’s
  insurance and not contributory with it.

                           
13.3.2      Company’s insurance shall: 

                    (a)      name
Contractor, Subcontractors and their respective directors, officers,
representatives, employees and agents and any identified Financing Parties as
additional insureds; 

                    (b)     
  include the following cross-liability clause:

“Where more than one party comprises
the “Insured,” each of the parties shall, for the purpose of such insurance, be
considered as a separate and distinct unit/entity, and the words “the Insured”
shall be considered as applying to each party in the same manner as if a
separate policy has been issued to each of the said parties. The insurer shall
provide indemnity to each in the same manner and to the same extent as if a
separate policy has 

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been issued to each, provided that the
  total amount payable in respect of compensation shall not exceed the limits
  of indemnity”; 

                    (c)      provide
  that such Company’s insurance may not be cancelled, non-renewed or materially
  changed by the insurer without giving sixty (60) Days’ prior written notice
  to the Contractor; 

                    (d)     
  waive any and all rights of subrogation against Contractor, Subcontractors and
  their respective directors, officers, representatives, agents and employees,
  and waive any other right of the insurers to any offset or counterclaim or any
  other deduction, whether by attachment or otherwise, in respect of any Liability
  of Contractor, Subcontractors or their respective directors, officers, representatives,
  agents and employees; and

                    (e)      provide
that any other insurance maintained by Contractor, any Subcontractors and their
respective directors, officers, representatives, agents and employees is in
excess of such Company’s insurance and not contributory with it. 

          13.4      Payment
of Deductibles 

          If
any of the insurance described above shall have any deductibles, the Party
obligated to procure such insurance shall be solely responsible for payment of
all such deductible amounts associated with such insurance. 

          13.5      Evidence
of Insurance 

          Within
thirty (30) Days of the Commencement Date (or with regard to the Builders All
Risk coverage described in Section 13.1(a)(i), prior to the commencement of Work
at the Site), each Party shall cause its insurers or agents to provide to the
other Party for the other Party’s review and approval certificates of insurance
evidencing the policies and terms specified in this Article 13. Notwithstanding
the foregoing, Contractor shall be entitled to cause its insurers or agents to
provide to Company the certificates of insurance evidencing its builders all
risk policy only when the relevant risk arises. Failure by a Party to obtain the
insurance coverage or certificates of insurance required by this Article 13
shall not in any way relieve or limit such Party’s obligations and liabilities
under this Contract, nor shall the failure of any insurance company for any
reason to pay claims accruing with respect to such Party’s insurance, affect,
negate or release such Party from any of the provisions of this Contract,
including such Party’s indemnity obligations. The insurance coverage to be
provided by each Party pursuant to this Article 13 are not intended to, and
shall not in any manner, limit or modify such Party’s obligations under this
Contract, except to the extent any proceeds of such insurance are applied in
satisfaction of such Party’s obligations. If a Party shall fail to procure or
maintain its insurances, then the other Party shall have the right (but shall
not be obligated) to provide and maintain such insurance at the defaulting
Party’s expense and to deduct the cost thereof from any amount or amounts due to
the other Party or in the event there are no such amounts due and payable, the
defaulting Party shall reimburse the other Party for such costs on demand.

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ARTICLE
14.      DISPUTE RESOLUTION

          14.1      Settlement
by Mutual Agreement 

          Company
and Contractor desire that this Contract operate between them fairly and
reasonably. If during the term of this Contract a dispute arises between Company
and Contractor, or one Party perceives the other as acting unfairly or
unreasonably, or a question of interpretation arises hereunder, then the Parties
shall cause the Company’s Representative and Contractor’s Representative to
promptly confer and exert their good faith efforts to reach a reasonable and
equitable resolution of the issue. If Company’s Representative and Contractor’s
Representative are unable to resolve the issue within fourteen (14) Days (within
five (5) Days if a payment dispute), the matter shall be referred within two (2)
Days of the lapse of such period to the Parties’ responsible officers for
resolution. Neither Party shall seek resolution by mediation or arbitration of
any dispute arising in connection with this Contract until both Parties’
responsible officers, who shall be identified by each Party from time-to-time,
have had at least fourteen (14) Days (seven (7) Days if a payment dispute) to
resolve the dispute following referral of the dispute to such responsible
officers. If the Parties fail to settle such dispute within such period
(including a failure to identify their respective responsible officers and
make necessary referrals within such period), the provisions of Section 14.2
shall apply unless the Parties agree that the dispute is to be resolved
according to the provisions of Section 14.3. 

          14.2     
Mediation 

          If
a dispute under this Contract is not resolved by the Parties pursuant to Section
14.1, upon the request of either Party the Parties shall try in good faith to
settle the dispute by nonbinding mediation administered by the American
Arbitration Association under its Commercial Mediation Rules before resorting to
arbitration. Unless otherwise agreed upon by the Parties, the mediation shall be
held in King County, Washington. Each Party shall bear the cost and expense of
preparing and presenting its own case (including, but not limited to, its own
attorneys’ fees and costs of witnesses). Payment of the mediator and other costs
and expenses of the mediation shall be divided equally among the Parties.

          14.3      Pending
Disputes 

          Notwithstanding
any provision of this Article 14 to the contrary, either Party may commence
litigation within thirty (30) Days prior to the date after which the
commencement of litigation could be barred by any applicable statute of
limitations or other law, rule, regulation, or order of similar import or in
order to request injunctive or other equitable relief in connection with any
bankruptcy or insolvency proceeding or otherwise necessary to prevent
irreparable harm. In such event, the Parties shall (except as may be prohibited
by judicial order) nevertheless continue to follow the procedures set forth
herein. While any disputes under this Contract are pending, including the
commencement and pendency of any of the dispute resolution procedures set forth
in this Article 14, the Parties shall abide by all their obligations under this
Contract without prejudice to a final determination in accordance with the
foregoing provisions of this Article 14. 

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ARTICLE
15.      INDEMNIFICATION

          15.1      General

          Contractor
shall defend, indemnify and hold harmless Company, the Financing Parties, each
of their parent company and affiliates, and the directors, officers, members,
agents, employees, successors and assigns of each of them (each, a “Company
Indemnified Party”), from and against any and all claims, demands, and
causes of action asserted by any Governmental Authority or other third party
against any Company Indemnified Party (other than as a result of a breach of
this Contract by such person) and any Liabilities, including reasonable
attorneys’ fees, incurred by such Company Indemnified Party in connection
therewith to the extent and as a result of Contractor’s performance (or that of
its Subcontractors, agents, employees or consultants) under this Contract,
including, but not limited to (a) on account of any violation of any Law or
Permit to be complied with by Contractor hereunder; and (b) in respect of any
Taxes imposed on or attributable to performance of Contractor (other than sales
or use taxes in the State of Idaho except to the extent that Company has not
made payment to Contractor when due hereunder Taxes in the State of Idaho; in
each case other than to the extent caused by or arising from the negligence or
willful misconduct of such Company Indemnified Party not attributable to
Contractor or any affiliate or Subcontractor of Contractor. 

          15.2      Indemnification
for Bodily Injury or Property Damage 

          Company,
as one Party, and Contractor, as the other Party, shall defend, indemnify and
hold each other, and each other’s lenders, Financing Parties, parent company,
affiliates, officers, directors, members, agents and employees, owners of the
real property comprising the Site, harmless from and against any loss, damage or
liability (including, but not limited to, reasonable attorneys’ fees and other
costs but excluding consequential damages) on account of any claim by a third
party for bodily injury or property damage against the indemnified party caused
by the negligent act or omission of the indemnifying party or the indemnifying
party’s employees, contractors, subcontractors or agents, in connection with the
performance of their respective undertakings under this Contract. 

          15.3      Indemnity
from Liens 

          Contractor
shall defend, indemnify and hold each of the Company Indemnified Parties
harmless from and against (i) all liens arising from the performance of the Work
by Contractor or otherwise caused by any Subcontractor or any employee, agent or
Affiliate of Contractor or any of its Subcontractors or anyone else entitled to
file a lien under Law; and (ii) any loss, damage or liability (including, but
not limited to, reasonable attorneys’ fees and other costs) in connection with
any and all mechanics’ liens filed in connection with Contractor’s Work
hereunder. This Section 15.3 shall not apply to Liens of Contractor which result
from non-payment by Company. 

          15.4      Contractor’s
Infringement Indemnity 

          Contractor
shall indemnify and keep indemnified and hold harmless Company Indemnified
Party(ies) from and against any and all third-party suits, actions claims of any
type 

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of character, type or description, based upon any claim of
infringement of any patent or other license or intellectual property right
(whether by way of trademark or otherwise) resulting directly or indirectly from
furnishing of the Work pursuant to this Contract asserted by any third party
against any Company Indemnified Party and any Liabilities, including reasonable
attorneys’ fees, incurred by such Company Indemnified Party in connection
therewith. Each Party agrees to notify the other as soon as reasonably possible
of any material matters with respect to which the foregoing indemnity is likely
to apply and of which the notifying Party has actual knowledge. If notified in
writing of any action or claim for which the Contractor may be liable to provide
indemnity, the Contractor shall, without limitation, defend (subject to
reasonable consultation with Company) such action or claim at their expense and
pay the cost and damages and attorneys’ fees awarded against Company in such
action or claim; provided, however, that the Contractor shall have the right to
control the defense and settlement of all such actions or claims, which
settlement shall be subject to the consent of Company, if applicable, not to be
unreasonably withheld. This Section 15.4 shall not be applicable to any suit,
claim or proceeding based on infringement or violation of a patent or copyright
(i) relating solely to a particular process or product of a particular
manufacturer specified by Company and not offered or recommended by Contractor;
or (ii) arising from modifications to the Work by Company after Final Completion
of the Facility. If a suit, claim or proceeding is based upon the events set
forth in the preceding sentence, Company shall defend, indemnify and hold
harmless Contractor to the same extent as Contractor is obligated to indemnify
Company. 

          15.5      Company’s
Indemnity 

          Company
shall defend, indemnify and hold harmless Contractor and its Subcontractors and
their respective joint venture partners, directors, officers, agents, employees,
shareholders and affiliates from any and all Liability or Proceedings arising
out of: 

                    (a)      any
  actual or alleged injury or death of persons or damage to property arising out
  of the negligence, willful misconduct or default of Company (except only to
  the extent that the same have been caused by the negligence or default of Contractor
  or its Subcontractors); 

                    (b)      any
and all environmental related liability or cost arising from or related to the
Site, including any actual or alleged injury to persons or property related
thereto or any remedial activity (except to the extent the same was caused by
the negligence or default of Contractor or its Subcontractors in connection with
their performance of the Work); or 

                    (c)      on
  account of any violation of any Law or Permit to be complied with by Company
  hereunder.

          15.6     
Notice and Settlement of Claims 

          A
Party seeking the benefit of an indemnity under this Article 15 shall give the
other Party written notice of any claim giving rise to the indemnity promptly
after such Party learns of the same. The indemnifying Party may, at its own
cost, conduct negotiations for the settlement of such claim and any litigation
that may arise therefrom. The Party claiming the benefit of the indemnity shall
not make any admission that might be prejudicial to the indemnifying Party 

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unless the indemnifying Party fails to take over the conduct of
the negotiations or litigation within a reasonable time after having been so
requested. The indemnifying Party shall not settle any indemnified claim without
the indemnified Party’s prior written approval (not to be unreasonably withheld
or delayed). The Party claiming the benefit of the indemnity shall, at the
request of the other Party, provide reasonable assistance for the purpose of
contesting any such claim or action, and shall be paid all reasonable costs
incurred in doing so and shall have the right to have its own counsel, at its
expense, participate in the defense and negotiation of the claim or action.

ARTICLE
16.      ASSIGNMENT 

          16.1      Assignment
by Company 

          Company
  may not assign any or all of its obligations, rights, title and/or interest
  in and to or arising out of or in connection with the Contract without the prior
  written approval of Contractor, which approval shall not be arbitrarily or unreasonably
  withheld or delayed. Notwithstanding the foregoing, Company may assign its obligations,
  rights, title and/or interest in and to or arising out of or in connection with
  the Contract to an Affiliate who is a special purpose entity wholly owned by
  Company whose sole assets relate to the Facility, without Contractor’s
  consent. No assignment of Company’s obligations, rights, title and/or interest
  in and to or arising out of or in connection with the Contract shall relieve
  Company of any obligation hereunder. 

          16.2      Assignment
by Contractor 

          Contractor
may not assign any or all of its obligations, rights, title and/or interest in
and to or arising out of or in connection with the Contract without the prior
written approval of Company, which approval shall not be arbitrarily or
unreasonably withheld or delayed. Notwithstanding the foregoing, Contractor may
assign its obligations, rights, title and/or interest in and to or arising out
of or in connection with the Contract to an Affiliate, without Company’s
consent. No assignment of Contractor’s obligations, rights, title and/or
interest in and to or arising out of or in connection with the Contract shall
relieve Contractor of any obligation hereunder. 

          16.3      Succession

          This
Contract shall inure to the benefit of and be binding upon the successors and
permitted assigns (as provided for by Sections 16.1 and 16.2) of the
Parties.

ARTICLE
17.      SUBCONTRACTORS

          17.1      Subcontracts

          Subject
to Section 17.2, Contractor may enter into Subcontracts for the performance of
the Work and shall be solely responsible for the satisfactory performance of the
Work and the acts, defaults and omissions of any Subcontractor notwithstanding
any review, approval or other action taken by Company with regard to the
selection of a Subcontractor hereunder. Contractor 

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shall be responsible for the actions of the Subcontractors in
  their performance of the Work as if such actions were those of Contractor. The
  issuance of any Subcontract shall not relieve Contractor of any of its obligations
  under this Contract. All Subcontracts shall be consistent with and in no way
  contrary to or inconsistent with any of the terms or provisions of this Contract.
  No contractual relationship shall exist between Company and any Subcontractor
  with respect to the Work to be performed hereunder, and no Subcontractor is
  intended to be or shall be deemed a third-party beneficiary of this Contract.
  Except as expressly set forth in Section 17.2, nothing contained herein shall
  (a) create any contractual relationship between any Subcontractor and Company
  or (b) obligate Company to pay or arrange for the payment of any Subcontractor.

          17.2      Subcontract
Provisions 

          Contractor
shall ensure that Subcontracts made with Subcontractors having a value of Two
Million Dollars or more are made in writing. Contractor shall make reasonable
efforts to require that each such Subcontract shall provide that the rights and
obligations of Contractor under each such Subcontract are assignable to Company,
its successors and assigns upon Company’s written request accompanied by proof
of source of payment to such Subcontractor’s satisfaction, following any
termination of this Contract. 

          17.3      Approved
Vendors 

          Contractor
shall not subcontract the supply of any equipment for a price of in excess of
One Million Dollars ($1,000,000), except to Major Vendors approved by Company,
which approval shall not be arbitrarily or unreasonably withheld. The vendors
appearing on the Approved Vendors List set forth in Exhibit F have been approved
by Company. The Approved Vendors List attached as Exhibit F is preliminary and
may be amended in the following manner. In the case the need arises for
Contractor to add a Major Vendor to the Approved Vendors List, in Contractor’s
opinion, Contractor shall propose such addition to the Company’s Representative
in writing identifying the type of equipment that could be purchased from such
Major Vendor. Within five (5) Days after receipt of Contractor’s proposal, the
Company’s Representative shall have the right to advise Contractor of any such
potential Major Vendors to which it reasonably objects, together with the
reasons for objection. Contractor shall not add any potential Major Vendor to
the list to which the Company’s Representative so reasonably objects. If the
Company’s Representative fails to respond within such five (5) Day period,
Contractor shall have the right to add said potential Major Vendor to the list.

          17.4      Exclusion

          The
provisions of this Article 17 shall not apply to the suppliers of equipment for
the OEC. 

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ARTICLE
18.      SUSPENSION 

          18.1      Right
of Company to Suspend Work 

          Company
may suspend performance of the Work by Contractor hereunder as provided in
Section 8.1.1. 

          18.2      Initial
Payments to Contractor 

          Contractor
shall be entitled to payment for Work that has been completed as of the
effective date of such suspension or concerning which delivery has been
suspended if such suspension has not ceased within ten (10) Days of the
effective date of such suspension within thirty (30) Days of the issuance of an
invoice therefore by Contractor. 

          18.3      Extended
Suspension 

          In
the event that the duration of the suspensions by Company exceed ninety (90)
Days in the aggregate, then Contractor may give notice to the Company’s
Representative requesting permission to proceed. If permission is not granted
within twenty (20) Days of the delivery of such notice, Contractor may terminate
its obligations under the Contract by so notifying Company in writing, and
Contractor shall be entitled to payments as described in Section 19.2.2.

          18.4      Right
of Contractor to Suspend 

          Contractor
may suspend performance of the Work hereunder, in whole or in part, upon ten
(10) Days’ prior written notice to Company of such suspension (i) where
Company has withheld from payment any amount invoiced by Contractor unless
within fifteen (15) Days of the Company’s Representative’s receipt of any such
invoice Company has released such payment or such withheld payment has been
deposited into the joint bank account of Company and Contractor with Bank of
America or other bank acceptable to Company and Contractor or otherwise set
aside for payment to Contractor in a form acceptable to Contractor pending
resolution of the dispute in accordance with the dispute resolution procedures
set forth in Article 14; (ii) the aggregate amount of the Contract Price
payments being withheld by Company, whether or not deposited in the
above-referenced account, equals Two Hundred Thousand Dollars ($200,000); or
(iii) Company breaches or is in default under any financing obligations with any
Financing Parties. Such suspension shall continue for the period specified in
the suspension notice. 

          18.5      Additional
Changes Resulting From Suspensions 

          Provided
that suspension is not necessary by reason of a default on the part of
Contractor that has not been corrected, in the event of suspension pursuant to
this Article 18 the Contract Price shall be increased by the amount equal to the
additional costs reasonably incurred by Contractor as a result of the suspension
(including costs for the purpose of safeguarding, storage, personnel,
Subcontractors or rented equipment costs, demobilization and re-mobilization
costs and increased costs or charges incurred for rescheduling) and the
scheduled dates specified in this Contract, the Schedule, and all other dates
and milestones herein by which Contractor’s 

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responsibilities are measured shall be adjusted to reflect any
  delays resulting from such suspension (including a period equal to the suspension
  period, a period for demobilization and re-mobilization plus any additional
  period required). If Contractor shall, solely in consequence of such suspension,
  be required to perform any obligations under its warranty at a time which exceeds
  the original schedule for warranty obligations that would have been applied
  if there were no suspension, the additional cost of complying with the warranty
  obligations shall be added to the Contract Price.

          18.6      Resumption
of Work 

          Upon
receipt of notice to resume the Work in accordance with this Contract,
Contractor shall examine the Facility and the Work affected by the suspension.
Contractor shall make good any deterioration or defect in or loss of such
Facility or Work that may have occurred during suspension, and costs incurred in
making such examinations and making good and resuming Work shall be added to the
Contract Price, all of which Work shall be at Company’s expense unless such
suspension occurred by reason of a default on the part of Contractor that was
not corrected within the time period specified in Section 19.1. 

ARTICLE
19.      TERMINATION

          19.1      Termination
by Company 

                      
  19.1.1      Company may terminate the Work and
  this Contract after the occurrence of one or more of the following events of
  default and if, following a written notice from Company to cure such event of
  default, said event of default continues to exist for ten (10) Days in the circumstances
  described in (a) below, and thirty (30) Days in the circumstances described
  in (b) below:

  
              (a)      the
      occurrence of an Insolvency Event involving Contractor; or

               (b)      Contractor
      defaults in its performance under a material provision of this Contract;
      provided, however, that Company may not terminate this Contract if, after
      notice of such default and prior to expiration of the thirty (30) Day period
      set forth above, Contractor has commenced and is diligently pursuing efforts
      to cure such breach. 

  

                      
  19.1.2      In the event of termination as provided
  in Section 19.1.1, Company shall compensate Contractor for all payment milestones
  achieved plus a pro rata portion of the payment milestone amounts for payment
  milestones partially achieved as of termination, but Company shall not compensate
  Contractor for any other costs associated with the termination of the Work.
  Upon termination and such payment, Contractor shall deliver to Company possession
  of the Work in its then condition, including Drawings and Specifications and
  contracts with Subcontractors, and construction supplies dedicated solely to
  construction of the Facility.

                   
   19.1.3      In the event of
termination as provided in Section 19.1.1: (a) Company shall have the right, at
its sole option, to assume and become liable for any reasonable written
obligations and commitments that Contractor may have in good faith undertaken
with third parties in connection with the Work, which obligations and
commitments are by Law or by their 

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terms assumable by Company and are not covered by the payments
  made to Contractor under Section 19.1.2; and (b) Contractor shall be entitled
  to draw the full amount of the Letter of Credit as of the date of such event
  of termination. If Company elects to assume any obligation of Contractor as
  described in this Section 19.1.3, then as a condition precedent to Company’s
  compliance with any subsection of this Article 19, Contractor shall execute
  all papers and take all other reasonable steps requested by Company that may
  be required to vest in Company all rights, set-offs, benefits and titles necessary
  to such assumption by Company of such obligations. Company agrees to indemnify
  and hold Contractor harmless against any Liability under any obligations assumed
  by Company pursuant hereto.

          19.2      Termination
by Contractor 

                    
    19.2.1      Contractor may terminate
  the Work and this Contract after the occurrence of one or more of the following
  events of default and if, following a written notice from Contractor to Company
  to cure such event of default, said event of default continues to exist for
  ten (10) Days in the event of a payment default, and thirty (30) Days in the
  event of any of the other defaults described below:

  
              (a)      the
      occurrence of an Insolvency Event involving Company;

              (b)      Company
      defaults in its performance under a material provision of this Contract,
      including the obligation to make any payment hereunder; provided, however,
      that Contractor may not terminate this Contract if, for all cases except
      for the obligation to make or complete any payment, after notice of such
      default and prior to expiration of the thirty (30) Day period set forth
      above, Company has commenced and is diligently pursuing efforts to cure
      such breach; or

              (c)      Company
      breaches or is in default under any financing obligations with any Financing
      Parties and fails to cure such breach or default within the cure or other
      period provided in the applicable agreement or instrument. 

  

                 
       19.2.2      In the
  event of termination as provided in Section 19.2.1, Company shall pay to Contractor
  the greater of (a) that portion of the Contract Price associated with all payment
  milestones achieved, including any amount in the Letter of Credit which amount
  Contractor may draw down, plus a pro rata portion of the payment milestone amounts
  for payment milestones partially achieved up to the date of Contractor’s
  receipt of notice of termination plus any costs attributable to and incurred
  in terminating the Work, including cancellation charges owed to third parties
  and additional compensation in the amount of twenty percent (20%) for the portion
  of the remaining unpaid Contract Price, but in no event shall the total amount
  exceed the Contract Price, or (b) the termination
  amount payable by Company to Contractor as specified in Section 19.4. If all
  such payments are not received within thirty (30) Days of termination, without
  derogation from other remedies available to Contractor, the license granted
  to Company under Section 9.4 shall automatically terminate and be of no further
  effect.

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          19.3      Due
to Force Majeure 

          If
(a) Company wholly suspends the Work on the Facility for six (6) consecutive
months due to the occurrence of a Force Majeure suffered by Company; or (b)
Contractor is prevented from performing the Work for a period of six (6)
consecutive months as a result of the occurrence of a Force Majeure suffered by
Contractor, then the affected Party may terminate this Contract at no cost or
penalty, other than the payment of all accrued payment obligations due and
payable pursuant to this Contract (excluding loss of anticipated profits for the
Work not yet performed by Contractor) upon not less than fifteen (15) Days prior
written notice to the other Party; provided, however, that nothing in this
Section 19.3 shall relieve or excuse either Party from its obligations under
Sections 19.5 and 19.6.

          19.4      Due
to Company’s Convenience 

          If
Company determines it is in its best interest to terminate this Contract for its
convenience, then Company may terminate this Contract at no cost or penalty if
such notice is given prior to Company issuing Contractor a Notice to Proceed
pursuant to Section 4.1. Company may also terminate this Contract for
convenience after issuing Contractor a Notice to Proceed at no cost or penalty,
other than the payment by Company to Contractor of the sum of (a) the greater of
(i) Five Million Dollars ($5,000,000) less payments previously made by Company
to Contractor under this Contract prior to termination or (ii) all accrued
payment obligations due and payable pursuant to this Contract plus a pro rata
portion of the payment milestone amounts for payment milestones partially
achieved up to the date of Contractor’s receipt of notice of termination
(excluding loss of anticipated profits for the Work not yet performed by
Contractor), (b) any costs attributable to and incurred in terminating the Work,
including cancellation charges owed to third parties, and (c) One Million
Dollars ($1,000,000) for miscellaneous expenses and/or loss of anticipated
profit for the Work not yet performed by Contractor. Such payment shall be made
by Company to Contractor not less than fifteen (15) Days after Contractor has
provided Company written notice of the amounts due. Nothing in this Section 19.4
shall relieve or excuse either Party from its obligations under Sections 19.6
and 19.7. It is understood and agreed by the Parties that Contractor shall be
damaged by Company’s termination of this Contract for convenience and that (i)
it would be impracticable or extremely difficult to fix the actual damages
resulting therefrom; (ii) the termination fee described in clause (c) above is
in the nature of liquidated damages, and not a penalty, and is fair and
reasonable; and (iii) such payments represent a reasonable estimate of fair
compensation to Contractor for the losses that may reasonably be anticipated
from such termination. 

          19.5      Exclusive
Remedy 

          Company’s
payment to Contractor pursuant to either Section 19.3 or 19.4, shall be
Contractor’s exclusive remedy against Company in the event of such termination.

          19.6      Actions
Required Following Termination 

          Upon
early termination of the Work, each Party shall be immediately released from any
and all obligations to the other Party (except for the obligation of each Party
to pay any amount then accrued or due hereunder, or otherwise due under this
Article 19), Contractor immediately 

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shall discontinue the Work and remove its personnel and construction
  equipment from the Site, and except for termination due to Company’s default
  Company shall be entitled to take exclusive possession of the Materials and
  all or any part of the Materials delivered or en route to the Site, to the extent
  that Company has paid Contractor all undisputed amounts hereunder then due and
  payable from Company to Contractor. Contractor shall immediately take such steps
  as are reasonably necessary to preserve and protect Work completed and in progress.

          19.7      Termination
and Transfer of Subcontracts and Other Rights 

          Upon
the early termination of the Work pursuant to this Article 19, including
pursuant to Section 19.4, if requested by the Company, Contractor shall make
reasonable efforts to cancel existing contracts with Subcontractors performing
Work at the Site. If early termination of the Work occurs due to the default by
Contractor, Contractor shall also, upon request by Company (a) deliver and
assign to Company, pursuant to a document produced by Contractor and reasonably
acceptable to Company, any and all Subcontracts, purchase orders, bonds and
options made by Contractor for Work to be performed at the Site (but in no event
shall Company be liable for any action or default of Contractor occurring prior
to such delivery and assignment (except to the extent such action or default was
caused by Company) and Contractor shall defend and hold harmless Company against
any such liability); and (b) deliver to Company originals of all Subcontracts
and all papers and documents relating to Contractor Permits, orders placed,
bills and invoices, lien releases related to the Work. All deliveries hereunder
shall be made free and clear of any liens, security interests or encumbrances,
except as may arise hereunder, be created by Company or may arise in favor of
Contractor due to non-payment by Company. Except as provided herein, no action
taken by Company or Contractor after the termination of the Work and/or this
Contract shall prejudice any other rights or remedies of Company or Contractor
provided by Law, this Contract or otherwise upon such termination. 

          19.8      Surviving
Obligations 

          Termination
or expiration of this Contract (a) shall not relieve either Party of its
obligations with respect to the confidentiality of the other Party’s information
as set forth in Article 21; (b) shall not relieve either Party of any
obligations hereunder which expressly or by implication survive termination
hereof; and (c) except as otherwise provided in any provision of this Contract
expressly limiting the liability of either Party, shall not relieve either
Company or Contractor of any obligations or liabilities for loss or damage to
the other Party arising out of or caused by acts or omissions of such Party
prior to the effectiveness of such termination or arising out of such
termination, and shall not relieve Contractor of its obligations as to portions
of the Work or other services already performed or of obligations assumed by
Contractor prior to the date of termination. This Section 19.8 shall survive the
termination or expiration of this Contract. 

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ARTICLE
20.      INTENTIONALLY OMITTED

ARTICLE
21.      CONFIDENTIALITY

          21.1      Both
Parties to Keep Information Confidential 

          Company
and Contractor shall keep confidential and shall not, without the written
consent of the other Party, divulge to any third party Information of the other
Party. 

          21.2      Use
of Information 

          Subject
always to Sections 9.1.1, 9.4 and 21.1, Company shall not use any Information of
Contractor for any purpose other than the operation and maintenance of the
Facility. Similarly, Contractor shall not use any Information received from
Company for any purpose other than the design, procurement of the Facility,
construction or such other Work as required for the performance of the
Contract. 

          21.3      Exclusions

          The
obligations of any Party under Sections 21.1 and 21.2 shall not apply to
Information of the other Party that: 

                    (a)      now
or hereafter enters the public domain through no fault of the receiving
Party; 

                    (b)      can
be proved to have been in the possession of the receiving Party at the time of
disclosure and which was not previously obtained, directly or indirectly, from
the other Party hereto; 

                    (c)      otherwise
lawfully becomes available to the receiving Party from a third party under no
obligation of confidentiality; or 

                    (d)      the
receiving Party is required by law or any relevant stock exchange or other
competent regulatory authority to publish or otherwise disclose but only to the
extent that it is necessary to publish or disclose the same. 

          21.4      Company
Not to Remove Logos 

          Company
shall not remove or detach from the Work or any part thereof any of Contractor’s
trademarks, designs, names, logos or markings. 

ARTICLE
22.      NOTICES 

               22.1      All
notices and other communications required or permitted by this Contract shall be
in writing and delivered by hand (including by messenger or courier) or by
airmail post or special courier or by telecopier or facsimile (receipt
confirmed), at the addresses or numbers set forth below or at such other
addresses or numbers as the Party receiving notice shall 

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subsequently designate by way of replacement by giving ten (10)
  Days’ written notice to the other Party pursuant to this Section:

	 	If to Company: 	US Geothermal, Inc. 
	 	  	1509 Tyrell Lane, Suite B 
	 	  	Boise, Idaho 83706 
	 	  	Attention: Daniel Kunz 
	 	  	Fax: (208) 424-1030 
	 	  	  
	 	with a copy for 	  
	 	any notice of 	  
	 	claim or dispute 	  
	 	to: 	Stoel Rives LLP 
	 	  	600 University Street 
	 	  	Seattle, WA 98101 
	 	  	Attention: John F. Pierce 
	 	  	Fax: (206) 386-5700 
	 	  	  
	 	If to Contractor: 	Ormat Nevada, Inc. 
	 	  	980 Greg Street 
	 	  	Sparks, NV 89431-6039 
	 	  	Attention: President 
	 	  	Fax: 702-356-9039 
	 	  	  
	 	with a copy for 	  
	 	any notice of 	  
	 	claim or dispute 	  
	 	to: 	Perkins Coie LLP 
	 	  	1201 Third Avenue, 40th Floor 
	 	  	Seattle, WA 98101-3099 
	 	  	Attention: Robert E. Giles, Esq. 
	 	  	Fax: 206-583-8500 

          22.2      Any
notice sent by telecopier or facsimile transmission shall be confirmed within
two (2) Days after dispatch by notice sent by airmail or special courier.

          22.3      Any
notice or confirmation of notice sent by airmail or special courier shall be
deemed (in the absence of evidence of earlier receipt) to have been delivered
ten (10) Days after dispatch and in proving the fact of dispatch, it shall be
sufficient to show that the envelope containing such notice was properly
addressed, stamped and conveyed to the postal authorities or courier service for
transmission by airmail or special courier. 

          22.4      Any
notice delivered by hand, facsimile, telecopier or telegram shall be deemed to
have been delivered on the date of its dispatch. 

          22.5      In
this Article 22, notices shall include any approvals, consents, instructions,
orders, and certificates to be given under the Contract. 

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ARTICLE
23.      MISCELLANEOUS

          23.1      Governing
Law 

          This
Contract and the Exhibits hereto shall in all respects be governed by and
construed under the laws of the State of Idaho, without regard to the principles
of conflict of laws. The selection of Idaho law shall conclusively be presumed
to be a significant, material and reasonable relationship with the State of
Idaho and shall be enforced whether or not there are other relationships with
the State of Idaho. Any dispute arising under or related to this Agreement shall
be resolved by a court of competent jurisdiction in King County, Washington and
each party hereby irrevocably and unconditionally submits to such exclusive
jurisdiction and venue. 

          23.2      Construction

          This
Contract and any documents or instruments delivered pursuant hereto shall be
construed without regard to the identity of the person who drafted the various
provisions of the same. Each and every provision of this Contract and such other
documents and instruments shall be construed as though the parties participated
equally in the drafting of the same. Consequently, the parties acknowledge and
agree that any rule of construction that a document is to be construed against
the drafting party shall not be applicable to this Contract or such other
documents or instruments. 

          23.3      Nature
of Agreement 

          Contractor
and its Subcontractors shall be independent contractors with respect to the
Work, irrespective of whether such Subcontractors are selected or approved by
Company, and neither Contractor nor its Subcontractors, nor the employees of
either, shall be deemed to be the servants, employees, representatives or agents
of Company. This Contract does not create any agency, partnership, joint venture
or other joint relationship between Company and Contractor. Nothing contained in
this Contract shall be construed (a) to authorize either Party hereto to act as
agent for the other Party or to permit a Party hereto to undertake any contract
or other obligation for the other Party or (b) to create any agency,
partnership, joint venture or other joint relationship between the Parties.

          23.4      Severability

          In
the event that any of the provisions or portions, or applications thereof, of
this Contract become invalid, illegal or unenforceable in any respect under the
Law of any jurisdiction, Company and Contractor shall negotiate an equitable
adjustment in the provisions of this Contract with a view toward effecting the
purpose of this Contract, and the validity and enforceability of the remaining
provisions or portions, or applications thereof, shall not be affected
thereby. 

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          23.5      Amendments
and Waivers 

          This
Contract may not be changed or amended orally, and no waiver hereunder may be
oral. Any change or amendment or any waiver of any term or provision of, or
consent granted under, this Contract shall only be effective if given in writing
and signed by the waiving or consenting Party (or both Parties in the case of a
change or amendment). 

          23.6      Survival

          The
provisions of Sections 2.4, 3.3, 5, 9.1.1, 9.4, 9.5, 11.2, 11.3, 11.4, and all
of Articles 5, 14, 15, 19, 21, 22 and 23 shall survive termination or expiration
of the Contract for whatever reason. 

          23.7      Counterparts

          This
Contract may be executed in separate counterparts, each of which shall be deemed
an original, but all of which together shall constitute but one and the same
instrument. 

          23.8      Entire
Contract 

          This
Contract and the Exhibits sets forth the full and complete understanding of the
Parties relating to the subject matter hereof as of the Effective Date and
supersedes any and all negotiations, agreements, understandings and
representations made or dated prior thereto with respect to such subject matter.
Contractor shall not be bound by, and specifically objects to, any term,
condition or other provision that is different from or in addition to the
provisions of this Contract (whether or not it would materially alter this
Contract), which is proffered by Company in any purchase order, receipt,
acceptance, confirmation, correspondence or otherwise, unless Contractor
specifically agrees to such provision in a written instrument signed by
Contractor. 

          23.9      Waivers

          Subject
to Section 23.5, no relaxation, forbearance, delay, indulgence or failure by
either Party to enforce any of the terms, covenants, conditions or other
provisions of this Contract at any time shall in any way prejudice, affect,
limit, modify or waive that Party’s right thereafter to enforce or compel strict
compliance with every term, covenant, condition or other provision hereof, any
course of dealing or custom of the trade notwithstanding. No delay or omission
on the part of a Party shall operate as a waiver thereof, nor shall any waiver
by either Party of any breach of the Contract operate as a waiver of any
subsequent or continuing breach of the Contract. 

          23.10      Counterparts;
Transmitted Copies 

          This
Contract may be executed in any number of counterparts, each of which shall be
deemed an original, but all of which taken together shall constitute one and the
same instrument. To expedite the process of entering into this Contract, the
parties acknowledge that Transmitted Copies of this Contract shall be equivalent
to original documents until such time (if any) as original documents are
completely executed and delivered. “Transmitted Copies” mean copies 

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that are reproduced or transmitted via facsimile or another
process of complete and accurate reproduction and transmission. 

          23.11      Further
Assurances 

          Company
and Contractor shall use reasonable endeavors to implement the provisions of
this Contract, and for such purpose each, at the request and expense of the
other, shall, without further consideration, promptly execute and deliver or
cause to be executed and delivered to the other such, consents, documents or
other instruments in addition to those required by this Contract as the other
may reasonably require to implement any provision of this Contract. 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 

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         IN WITNESS
  WHEREOF, the Parties have caused this Contract to be executed on the date
  first above written.

	Company: 	 	Contractor: 
	 	 	 	 	 
	US Geothermal, Inc. 	 	Ormat Nevada, Inc. 
	 	 	 	 	 
	By: 	  	 	By: 	  
	 	 	 	 	 
	Name: 	Daniel
      Kunz 	 	Name: 	Hezy Ram 
	 	 	 	 	 
	Title: 	President and CEO 	 	Title: 	Executive Vice President
    

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EXHIBIT A 

SCOPE OF WORK ALLOCATION AND INTERFACE POINTS 

1.      Scope
of Work Between Contractor and Company for Facility Construction 

          The
allocation and division of the work to be performed by Company and Contractor is
defined below for the Facility and the remainder of the Project. As used in this
Exhibit A, references to “Power Plant” shall have the same meaning as Facility
and “Geothermal Fluid” shall have the meaning ascribed to that term in Exhibit
D. All technical work is as defined in Exhibit C. The list below does not
replace Exhibit C, but simply confirms and clarifies specific areas of
conformance with that document. 

  	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	  	  	  	  
	1   	POWER PLANT PROJECT & CONSTRUCTION
        MANAGEMENT 	    	    

	  	Free Site access and main access road 	  	Company 
	  	On-Site Overall Site Management 	Lot 	Contractor 
	  	All Trade Labor & Construction Supervision
      	Lot 	Contractor 
	  	Project and Construction Scheduling 	Lot 	Contractor 
	  	Supervision During Preparation Of the Site Area
      	Lot 	Contractor 
	    	Supervision of Initial Start-Up And
        Power Plant Commissioning 	Lot   	Contractor   

	  	Operator Training (Power Plant and Control System)
      	Lot 	Contractor 
	  	  	  	  
	2   	DESIGN, ENGINEERING & DOCUMENTATION
      	    	    

	  	  	  	  
	  	Heat source and cooling water characteristics
        and 

        utilization constraints 	  	Company 
	  	Drawing Schedule 	Lot 	Contractor 
	  	Site General Arrangement 	Lot 	Contractor 
	  	Equipment General Arrangement Drawings 	Lot 	Contractor 
	  	Foundation Plan & Details 	Lot 	Contractor 
	  	Electrical One Line Diagrams 	Lot 	Contractor 
	  	Equipment Schematic & Wiring Diagrams 	Lot 	Contractor 
	  	Lighting Plan 	Lot 	Contractor 
	  	MCC & Electrical Equipment Layout Drawings
      	Lot 	Contractor 
	  	Piping & Instrument Diagrams 	Lot 	Contractor 
	    	Control System Programming (Power Plant,
        Gathering and Injection System, and other Project facilities) 	Lot   	Contractor   

	    	Well Head Control System Equipment
        and Control Strategies 	Lot   	Company   

59 

EXECUTION COPY 

  	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	  	Geotechnical Report 	Lot 	Company 
	  	Utility interconnection study 	  	Company 
	  	Mechanical and electrical detailed design, Power
        Plant 	  	Contractor 
	  	Mechanical and electrical detailed design, gathering
        

        system and well pad 	  	Company 
	  	Water treatment system design 	  	Company 
	      	Mechanical and electrical design for
        raw water supply and blow-down system outside the Power Plant fence line
      	      	Company     

	  	  	  	  
	3 	CIVIL WORKS 	  	  
	  	Site Final Grading, including runoff containment
      	Lot 	Contractor 
	  	Foundations and Anchor Bolts (inside Power Plant)
      	Lot 	Contractor 
	  	Cooling Tower Basin 	1 	Contractor 
	    	Containment for transformers, pentane
        storage, diesel tanks, etc. (inside Power Plant) 	Lot   	Contractor   

	      	Preparation and maintenance of Access
        road, well pads, roads to wells and any other outside of the Power Plant
        area 	      	Company     

	    	Gravel for Power Plant Site Area (Crushed
        Stone Surface) 	Lot   	Contractor   

	  	Fencing Around Power Plant Boundaries 	Lot 	Contractor 
	  	Final Grouting of Equipment, Skids, Etc. 	Lot 	Contractor 
	    	Rubbish storage area (excluding Contractor
        Hazardous Materials) 	    	Company   

	      	Removal and final disposal of Contractor
        rubbish and debris, and Contractor Hazardous Materials from the Facility.
      	      	Contractor     

	  	  	  	  
	4   	STRUCTURAL STEEL & PLATFORMS
        (Inside Plant fence line) 	    	    

	  	Structural Steel And Platforms 	Lot 	Contractor 
	  	Pipe Supports 	Lot 	Contractor 
	  	Conduit & Cable Tray Supports 	Lot 	Contractor 
	  	All Other Structural Steel 	Lot 	Contractor 
	  	  	  	  
	5 	ORMAT ENERGY CONVERTER 	  	  
	  	Turbine – Generator Set 	Lot 	Contractor 
	  	Turbine – Generator oil system 	  	  
	  	Turbine and Generator Controls and Protection
      	Lot 	Contractor 
	  	Electrical system 	  	Contractor 
	  	Vaporizer and pre-heaters. 	  	Contractor 
	  	Condenser (with 316L tubes) 	Lot 	Contractor 

60 

EXECUTION COPY 

  	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	  	Working fluid pumps, piping, and instrumentation
      	Lot 	Contractor 
	  	Pentane Vapor Recovery system 	Lot 	Contractor 
	  	Working fluid (Pentane) initial fill up and allowance
        for purging and losses during startup. 	  	Contractor 
	6 	Injection Pumps 	  	  
	  	Foundations 	  	Contractor 
	  	4160V Electrical Supply and Equipment 	  	Contractor 
	  	Power Metering 	  	Contractor 
	  	Piping and Valves 	  	Contractor 
	  	Instrumentation and control 	  	Contractor 
	  	Injection pump specification 	  	Company 
	  	Purchase of pumps to specification 	  	Contractor 
	  	  	  	  
	7     	RAW WATER SUPPLY 

        (For fire water, construction, cooling water & sanitary use)
      	      	      

	      	Single water supply line to the Power
        Plant fence for all uses (service, pump seals, sanitation, CT makeup,
        etc.) 	Lot     	Company     

	    	Pumps and piping as required to deliver
        water from fence to uses within the Power Plant. 	    	Contractor   

	  	Fittings, Valves, And Hardware 	Lot 	Contractor 
	  	Interconnect Cabling 	Lot 	Contractor 
	  	  	  	  
	8 	COOLING WATER SYSTEM 	  	  
	  	FRP Cooling Tower 	Lot 	Contractor 
	  	Cooling Tower water basin and pump pit 	Lot 	Contractor 
	  	Cooling water supply and return piping 	Lot 	Contractor 
	  	Cooling water circulating water pumps 	Lot 	Contractor 
	  	  	  	  
	9 	PENTANE STORAGE AND FEED SYSTEM 	  	  
	    	Storage tank system comprising Pumps,
        Piping, Valves, instrumentation, and all other ancillary items 	Lot   	Contractor   

	  	Mechanical installation 	  	Contractor 
	  	  	  	  
	10 	FIRE FIGHTING SYSTEM 	  	  
	  	Diesel Firewater Pumps 	1 	Contractor 
	  	Electric Jockey Pump 	1 	Contractor 
	    	Freeze protection and/or shed for fire
        water system and fire pumps 	1   	Contractor   

	  	Underground Fire Loop, Hydrants W/ Hose Reels
      	Lot 	Contractor 
	  	Interconnect Cabling, Testing and Checkout 	Lot 	Contractor 
	  	Fire annunciation and alarm system 	Lot 	Contractor 

61 

EXECUTION COPY 

  	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	  	Mechanical installation 	  	Contractor 
	  	Raw Water Tank with supply line to Power Plant
      	1 	Company 
	  	  	  	  
	11 	WASTE WATER SYSTEM 	  	  
	  	Blow Down Water Disposal (from condenser discharge
        to interface point) 	1 	Company 
	  	Piping, Fittings, Valves, flowmeter, and Hardware
      	Lot 	Contractor 
	  	Mechanical installation 	Lot 	Contractor 
	    	Interconnect Cabling Installation,
        Testing and Checkout 	Lot   	Contractor   

	  	Septic system for toilets and sinks 	1 	Contractor 
	  	  	  	  
	12 	WATER TREATMENT SYSTEM 	  	  
	  	Water Analysis and Treatment Design 	Lot 	Company 
	  	Water treatment system ( equipment and materials)
      	  	Company 
	  	Water treatment installation 	  	Contractor 
	    	Chemicals for initial fill up, commissioning
        and operation 	    	Company   

	  	Slab and foundations for the water treatment
      	  	Contractor 
	  	Mechanical and electrical Installation and connection
      	  	Contractor 
	  	  	  	  
	13 	COMPRESSED AIR SYSTEM 	  	  
	  	Compressor Package – Duplex Compressors
      	1 	Contractor 
	    	Compressed Air Piping, Fittings, Valves
        and Hardware 	Lot   	Contractor   

	  	Instrumentation (Pressure Transmitter And Indicator)
      	Lot 	Contractor 
	  	Mechanical installation 	Lot 	Contractor 
	  	Interconnect Cabling Installation, Testing and
      	Lot 	Contractor 
	  	Checkout 	  	  
	  	  	  	  
	14 	COMMUNICATION SYSTEMS 	  	  
	      	Supervisory Control System – Power
        Plant hardware and interconnection capability for gathering and injection
        system 	Lot     	Contractor     

	    	Programming of control system –
        Power Plant and gathering and injection system 	Lot   	Contractor   

	    	Telephone Connections from fence-line
        to PBX panel and distribution to control system and control room 	Lot   	Contractor   

	  	Telecom hardware inside PBX panel 	Lot 	Company 
	  	Construction telephone service for Contractor
      	Lot 	Contractor 
	  	  	  	  
	15 	BUILDINGS 	  	  
	  	Control Room (Operator Station) with closets
        and 	1 	Contractor 

62 

EXECUTION COPY 

	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	  	toilet facility 	  	  
	  	Off-site offices, warehouse, and maintenance
      building 	Lot 	Company 
	  	Electrical Building 	1 	Contractor 
	  	Mechanical Equipment Building 	1 	Contractor 
	  	Chemical Treatment area shed 	1 	Contractor 
	  	  	  	  
	16   	PLANT LIGHTING, LIGHTNING and
      GROUNDING 	    	    

	  	Site Lighting Distribution Panel 	1 	Contractor 
	  	Outside Lighting Fixtures & Control Sensors
    	Lot 	Contractor 
	  	Conduit And Wires 	Lot 	Contractor 
	  	Site Ground Grid, Conductors, Electrodes, Etc.
    	  	  
	  	Lightning Protection 	  	  
	  	  	  	  
	17 	ELECTRICAL SYSTEMS 	  	  
	  	12.47 / 34.5kV Main Step-Up Transformer 	1 	Contractor 
	  	12.47kV Generator Circuit Breaker 	Lot 	Contractor 
	  	12.47k V / 4160 V Aux Transformer (if required)
    	1 	Contractor 
	  	12.47kV / 480 V Service Transformer 	Lot 	Contractor 
	  	12.47 kV Power And Control Cabling Complete 	Lot 	Contractor 
	    	4160 And 480 V Power And control
      Cabling Complete within Power Plant scope 	Lot   	Contractor   

	    	Motor Control Centers And
      Distribution Panels for Power Plant scope with spares, 	Lot   	Contractor   

	  	Power, Control and Instrument Cabling Complete
    	Lot 	Contractor 
	  	Emergency Diesel Generator 	1 	Contractor 
	    	24 and 125 VDC System, Batteries,
      Cabling and Charges 	Lot   	Contractor   

	    	Conduit, Cable Trays, Terminations,
      Supports and Structures 	Lot   	Contractor   

	  	Electrical Testing and Checkout 	Lot 	Contractor 
	  	Freeze protection systems 	  	  
	  	  	  	  
	18   	34.5 KV EQUIPMENT AND
      TRANSMISSION INTERCONNECT 	    	    

	    	34.5 kV Breakers to Well Pump
      Upstream of plant output meter 	1   	Contractor   

	    	34.5 kV Breakers to Well Pump
      Downstream of plant output meter and transmission line breaker 	1   	Contractor   

	  	34.5 kV revenue metering and protection
      equipment 	Lot 	Contractor 
	  	34.5 kV Breaker to transmission system (line
      breaker) 	1 	Contractor 
	    	Dead-end poles for 34.5 kV lines to
      pumps and transmission line with disconnects 	Lot   	Company   

63 

EXECUTION COPY 

	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	    	Underground or overhead 34.5 kV cable
      from breakers to 34.5kV poles 	Lot   	Contractor   

	  	34.5 kV Disconnect Switch in Switchgear 	Lot 	Contractor 
	  	Surge Arresters 	Lot 	Contractor 
	  	Protective Relaying And Control (Inc.
      Breaker/Xfmr) 	Lot 	Contractor 
	  	Cable, Terminals, And Misc. Hardware 	Lot 	Contractor 
	  	Utility interconnection 	  	Company 
	  	Transmission line 	Lot 	Company 
	  	  	  	  
	19 	WELLS, FIELD GATHERING and WELL HEAD 	  	  
	  	SYSTEM 	  	  
	  	Production, re-injection and makeup well
      drilling 	  	Company 
	  	Well pad equipment including pump and
      auxiliaries 	  	Company 
	  	Production pipe lines and equipment 	  	Company 
	  	Injection pipe line and equipment 	  	Company 
	  	All electrical equipment in the well pads 	  	Company 
	  	Well pad controllers 	  	Company 
	    	Communication interface connection to
      well-pads in PLC/Communication hub at Power Plant fence-line 	9   	Contractor   

	    	Transmission line or cabling
      (electrical and control) to the well pads (well pumps) 	    	Company   

	  	  	  	  
	20 	MECHANICAL WORK – DETAILS 	  	  
	  	  	  	  
	  	Off Loading and Protection Of Equipment At Site
    	Lot 	Contractor 
	  	Setting And Leveling of Equipment On
      Foundations 	Lot 	Contractor 
	    	Installation And Testing of
      geothermal Piping Systems 	Lot   	Contractor   

	    	Installation And Testing of cooling
      water Piping Systems 	    	Contractor   

	  	Installation And Testing of auxiliary Piping
      Systems 	  	Contractor 
	  	  	  	  
	21 	MISCELLANEOUS 	  	  
	  	Operations & Maintenance Manuals 	Lot 	Contractor 
	    	Operators for plant start up,
      commissioning and operation 	    	Company   

	  	Transportation to the site of Contractor’s
      equipment 	  	Contractor 
	    	Replacement of Spares And Consumables
      Used in Installation And Startup 	Lot   	Contractor   

	  	Custom clearance and import duties 	  	Contractor 
	  	State and local taxes, duties and levies 	  	Company 
	  	Geothermal fluid in Design Conditions 	  	Company 

64 

EXECUTION COPY 

	ITEM 	ACTIVITY or EQUIPMENT DESCRIPTION 	QTY 	Supplied By 
	  	Raw water at Design Condition 	  	Company 
	  	Utility hook up 	  	Company 
	  	Plant Performance Test 	  	Contractor 
	  	OEC special tools 	  	Contractor 
	      	Spare Parts Initial Inventory And
      Special Maintenance Equipment (Optional Item Not Included In This
      Contract) 	Lot     	Company     

65 

EXECUTION COPY 

2.      Interface
Points Between Contractor and Company for Facility Construction 

	Description 	Interface 	Conditions 	Comment 
	Geothermal Fluid to Facility Power Plant  
        	Flange downstream of block valve into
      plant, on or adjacent to the Plant fence line. 	Per H&MB Diagram for “Guaranteed
      Design Point”   	Company to supply bypass pipeline
      from production line to injection line 

	Geothermal Fluid to Injection Wells    
            	Flange upstream of block valve out of
      Power Plant, but downstream of brine injection pumps, on or adjacent to
      the Plant fence line. 	Minimum discharge pressure = 60 psi
      above power plant inlet pressure. Maximum = 350 psig     	Pressures per the requirements of
      Paragraph 3.6.2 of the Design Criteria of Exhibit C.     

	Raw Water into Power Plant     	Pipe end at fence-line at depth below
      frost line   	1000 gpm at 13 psig    
        	Single supply line for cooling water
      make- up, sanitary water, and service water 

	Cooling Tower blowdown     	Pipe end at fence-line at depth below
      frost line   	Discharge from cooling water system
      downstream of Condensers 	        

	Power to Utility     	Pole-mounted disconnect inside Power
      Plant fence 	34.5 kV     	Company supplies pole and disconnect
        

	Power to wells (2 feeds)   	Pole-mounted disconnect inside Power
      Plant fence 	34.5 kV     	Company supplies pole and disconnect
        

	HMI at control room inside Facility Power Plant
      fence   	2 operator interface at Power Plant
      control room   	        	        

	HMI at nearby US Geo building    
          	Communications cable and location by
      Company HMI Computer and programming by Contractor 	         
        	         
        

	Production and Injection well controls  
          	Communication Hub Port(s) located in
      the Control Room     	Ethernet        
    	Communication protocol and equipment
      manufacturer to be same as ORMAT 

	Communication Cables to off-site 	Communication Hub in Control Room 	Company provides cables 	Contractor provides pull-box at base
      of 

66 

EXECUTION COPY 

	Description 	Interface 	Conditions 	Comment 
	control sites     	      	      	one 34.5 kV power pole interface with
      conduit to hub 

	Telephone and Internet   	Junction box inside fence   	      	Plenty of spare capacity into and out
      of junction box 

	Access and well field roads 	Fence-line   	    	    

67 

EXHIBIT B 
CONTRACT PRICE
and
PROJECT MILESTONE AND PAYMENT SCHEDULE 
Raft River EPC Contract
between US Geothermal and Ormat

	A. 	Contract Price 	 
    
	  	The Contract Price for the Facility is 	$20,200,000 
	  	  	(twenty million, two hundred thousand US
      dollars) 
	  	  	  
	B. 	Milestone Payment 	  
		Schedule 	 
    

  	# 

          	DESCRIPTION
      
(notes 1 - 5) 	Month 
(notes 7-9)
    	Documentation for Payments 

        (notes 6) 	% of EPC Contract Price
        
      

	  

          
  	  
  
  	  
  
  	  

          
  	Change in 
Committed 
Cost 	Minimum 
cash 
payment 	L/C fund 
amount 
 
  

	1 	Sign Contract 	n/a 	  	0% 	0% 	0% 
	2 	Notice to Proceed 	0.0 	• Contractor's invoice 	15% 	7% 	8% 
	3 

          
  	provide geotechnical and
      
topographical study (by Company) 
  	2.0 
  
  	  

          
  	  
  
  	  
  
  	0% 
  
  

	4 

          
  
  	issue purchase order for heat
      
exchangers materials or issue 
purchase order or subcontract for
      heat 
exchangers (subcontracted) 	2.0 
  
  
 
    	• Contractor's invoice 

        • P.O. for
      heat exchanger tubes or P.O. 
or Subcontract for heat exchanger
      
Subcontractor 	15% 
  
 
      
  	5% 
  
  
 
    	10% 
  
 
      
  

	5 	finalize oec components specification 	2.0 	  	  	  	0% 
	6 

          
  	complete conceptual design (p&id;
      
sld; layout; main equipment 
specification) 	2.0 
  
  	• Contractor's invoice 

        •
      Submittal to Company of 
conceptual design package 	2% 
  
  	2% 
  
  	0% 
  
  

	7 

          
  
 
      
  	provide access to the site and any
      
other required land, easements and 
rights of way, including access
      roads 
and lay down area for start of 
construction (by Company) 	2.5 
  
  
 
      
  	  

          
 
      
  
  	  
  
 
      
  
  	  
  
 
      
  
  	0% 
  
  
 
      
  

	8 

          	issue purchase order for step up
      
transformer 	3.0 
  	• P.O. for step up transformer 

        •
      Contractor's invoice 	4% 
  	2% 
  	2% 
  

	9 

          	issue purchase order for generator
      
  	3.0 
  	• Contractor's invoice 

        • P.O. for
      OEC Generator 	4% 
  	3% 
  	1% 
  

	10 

          	complete control configuration design
      
  	3.0 
  	  

          	1% 
  	1% 
  	0% 
  

	11 

          
  
  	Issue PO for detailed civil
      
engineering 
  
  	4.0 
  
  
 
    	• Contractor's invoice 

        •
      P.O/Engineering agreement for 
Civil Engineeringcivil engineering and
      
Designdesign 	1% 
  
  
 
    	1% 
  
  
 
    	0% 
  
  
 
    

	12 

          	issue purchase order for cooling
      
tower 	4.0 
  	• P.O. for Cooling Tower 

        •
      Contractor's invoice 	4% 
  	2% 
  	2% 
  

	13 

          
  	provide all construction-related
      
Company-obtained permits (by 
Company) 	4.0 
  
  	  

          
  	  
  
  	  
  
  	0% 
  
  

 

    68

  

  	# 

          	DESCRIPTION 

        (notes 1 - 5) 	Month
      
(notes 7-9) 	Documentation for Payments
      
(notes 6) 	% of EPC
      Contract Price   
      

	      	      	     
	      	Change in Committed
      Cost 	Minimum 
cash
      
payment 	L/C fund amount
        

	 14 

          	issue po's for cooling water circ 

        pumps 	4.0 
  	• Contractor's invoice 
• P.O. for
      cooling water pumps 	4% 
  	2% 
  	2% 
  

	 15 

          
  	issue PO for detailed electrical 

        engineering 
  	6.0 
 
      
  	• Contractor's invoice 
•
      P.O./Engineering Agreement for 
Electrical Engineeringand Design 	1% 
 
      
  	1% 
 
      
  	0% 
 
      
  

	 16 

          	commence fabrication of heat 

        exchangers 	6.0 
  	  
  	2% 
  	2% 
  	0% 
  

	 17 

         
      
   	Award Civil Contract 

          
 	6.0 
 
    
 	• Contractor's invoice 
•
      P.O./SubcontractConstruction 
 Contract for civil
      works    	1% 
 
    
 	1% 
 
    
 	0% 
 
    
 

	 18 	complete civil detailed design 	7.0 	  	2% 	1% 	1% 
	 19 	complete mechanical detailed design 	7.0 	  	1% 	1% 	0% 
	 20 

          
  	Award Mech Constr Contract 

          
  	7.0 
 
      
  	• Contractor's invoice 
•
      P.O./Subcontractconstruction 
contract. for mechanical works 	1% 
 
      
  	2% 
 
      
  	-1% 
 
      
  

	 21 

          
  	Award Electr Constr Contract 

          
  	7.0 
 
      
  	• Contractor's invoice 
•
      P.O./Construction contract for 
electrical works 	1% 
 
      
  	1% 
 
      
  	0% 
 
      
  

	 22 	civil contractor mobilization to site 	7.0 	• Contractor's invoice 	1% 	1% 	0% 
	 23 

          	construction power available (by 

        Company) 	7.0 
  	  
  	  
  	  
  	0% 
  

	 24 	commence foundation work 	8.0 	  	  	2% 	-2% 
	 25 	Vaporizer ready for shipment 	10.0 	  	2% 	2% 	0% 
	 26 

          	Cooling Tower Foundations complete 

          	10.0 
  	• Contractor's invoice 
  	2% 
  	2% 
  	0% 
  

	 27 

          	Condenser ready for shipment 

          	10.0 
  	• Contractor's invoice 
• Packing
      List 	3% 
  	3% 
  	0% 
  

	 28 	OEC generator ready for shipment 	10.0 	  	2% 	3% 	-1% 
	 29 

          	Cooling Tower Equipment Ready for 

        Shipment 	10.0 
  	• Contractor's invoice 
• Packing
      List 	3% 
  	3% 
  	0% 
  

	 30 

          	last oec components ready for 

        shipment 	11.0 
  	• Contractor's invoice 
• Packing
      List 	2% 
  	2% 
  	0% 
  

	 31 	OEC Foundations complete 	11.0 	• Contractor's invoice 	1% 	2% 	-1% 
	 32 

          	Receive majority OEC equipment on 

        site 	11.0 
  	  
  	1% 
  	3% 
  	-2% 
  

	 33 

          	Cooling tower pumps ready for 

        shipment 	11.0 
  	  
  	2% 
  	3% 
  	-1% 
  

	 34 	commence electrical work 	11.0 	• Contractor's invoice 	0% 	2% 	-2% 
	 35 	Provide operators ( By Company) 	11.0 	  	0% 	0% 	0% 
	 36 	commence erection oec unit 	12.0 	• Contractor's invoice 	0% 	3% 	-3% 
	 37 	Receive final OEC equipment on site 	12.0 	  	2% 	5% 	-3% 
	 38 

          	geothermal fluid available to Facility
        

        (by Company) 	12.0 
  	  
  	  
  	  
  	0% 
  

  69

  	# 

          	DESCRIPTION
      
(notes 1 - 5) 	Month
      
(notes 7-9) 	Documentation for Payments 

        (notes 6) 	% of EPC
      Contract Price   
      

	  

          
  	  
 
      
  	  
 
      
  	  

          
  	Change in
      
Committed 
Cost 	Minimum 
cash
      
payment 	L/C fund 
amount
      
  

	 39 

         
      
  	34.5 kV utility
      interconnection 
available for interconnect to Facility 
(by
      Company) 	12.0 
 
      
  	  

          
  	  
 
      
  	  
 
      
  	0% 
 
      
  

	 40 	Complete erection of cooling
      tower 	13.0 	  	       
         2% 	3% 	-1% 
	 41 	energize power plant 	15.0 	  	       
         1% 	3% 	-2% 
	 42 	complete erection of the oec unit
    	16.0 	  	       
         4% 	9% 	-5% 
	 43 

          	First admission of
      brine into the unit 
  	16.5 
  	  

          	  
  	  
  	  
 

	 44 

         
      
       
  
  
 
    	substantial completion
      
  
 
  
  
  	17.0 
 
      
 
  
  
  	• Contractor's invoice 

        •
      Certificate of Substantial 
  Completion Certificate
•
      Performance Tests readiness 
notice provided under Section 6.3 of the
      
Contract 	     
         8% 
  
 
  
  
  	10% 
 
      
 
  
  
  	-2% 
 
      
 
  
  
  

	 45 	Commence performance tests 	17.5 	    	  	  	  
	 46 

          
  	guaranteed final
      completion date 
  
  	19.0 
 
      
  	• Contractor's invoice 

        •
      Certificate of Final Completion 
Certificate 	     
         5% 
  
  	5% 
 
      
  	0% 
 
      
  

  70

EXECUTION COPY

 

EXHIBIT C

 

of the 

ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT 

Between US Geothermal, Inc. and Ormat Nevada, Inc., dated December 5, 2005

 

POWER PLANT DESIGN CRITERIA

Revision 0 – December 5, 2005

 

TABLE OF CONTENTS 

 

	
            1.0
 	
            INTRODUCTION
 	
            3
 

 

	
            2.0
 	
            BASIS OF PLANT OPERATION
 	
            3
 

 

	
            3.0
 	
            DESIGN CONDITIONS
 	
            4
 

 

	
             
 	
            3.1
 	
            LEGAL DESCRIPTION FOR POWER PLANT SITE NO.
 	
            14
 
	
             
 	
            3.2
 	
            SEISMIC ZONE
 	
            4
 
	
             
 	
            3.3
 	
            WEATHER DATA
 	
            4
 
	
             
 	
            3.4
 	
            DESIGN POINT CONDITIONS AND REQUIRED PLANT OUTPUT
 	
            6
 
	
             
 	
            3.5
 	
            PROCESS DESIGN CRITERIA
 	
            6
 
					

 

	
            4.0
 	
            CODES AND STANDARDS
 	
            9
 

 

	
            5.0
 	
            GENERAL SCOPE OF WORK REQUIREMENTS
 	
            12
 

 

	
             
 	
            5.1
 	
            INTRODUCTION
 	
            12
 

	
             
 	
            5.2 
 	
            CONTRACTOR ENGINEERING, PROCUREMENT, CONSTRUCTION, 
 

	
             
 	
            AND STARTUP SCOPE
 	
            12
 

	
             
 	
            5.3 
 	
            COMPANY SHORT DESCRIPTION OF SCOPE OF WORK AND 
 

	
             
 	
            RESPONSIBILITY
 	
            18
 

 

	
            6.0
 	
            MECHANICAL DESIGN 
 	
            19
 

 

	
             
 	
            6.1
 	
            PIPING DESIGN
 	
            19
 
	
             
 	
            6.2
 	
            PLANT LAYOUT REQUIREMENTS
 	
            23
 
	
             
 	
            6.3
 	
            MECHANICAL EQUIPMENT DESIGN CRITERIA
 	
            24
 
	
             
 	
            6.4
 	
            UTILITY SYSTEMS
 	
            31
 
	
             
 	
            6.5
 	
            OTHER PLANT AND FACILITY DESIGN CRITERIA
 	
            31
 

 

	
            7.0
 	
            ELECTRICAL DESIGN
 	
            35
 

 

	
             
 	
            7.1
 	
            GENERAL REQUIREMENTS
 	
            35
 
	
             
 	
            7.2
 	
            ELECTRICAL SCOPE OF WORK
 	
            35
 
	
             
 	
            7.3
 	
            DESIGN CONSIDERATIONS
 	
            37
 
	
             
 	
            7.4
 	
            DC SYSTEM
 	
            37
 
	
             
 	
            7.5
 	
            UPS SYSTEM
 	
            38
 
	
             
 	
            7.6
 	
            PLANT LIGHTING AND RECEPTACLES
 	
            38
 
	
             
 	
            7.7
 	
            STUDIES
 	
            39
 
	
             
 	
            7.8
 	
            GROUNDING SYSTEM
 	
            39
 

 

 

Page  1 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY

 

 

	
             
 	
            7.9
 	
            ELECTRICAL HEAT TRACING
 	
            39
 
	
             
 	
            7.10
 	
            CABLE SYSTEM
 	
            39
 
	
             
 	
            7.11
 	
            MOTOR SPECIFICATIONS
 	
            40
 
	
             
 	
            7.12
 	
            VARIABLE SPEED (OR FREQUENCY) DRIVE SPECIFICATION
 	
            40
 
	
             
 	
            7.13
 	
            DIESEL GENERATORSYSTEM
 	
            41
 
	
             
 	
            7.14
 	
            REVENUE METERING AND UTILITY COMMUNICATIONS/TELEMETRY
 	
            41
 

 

	
            8.0
 	
            INSTRUMENTATION AND CONTROLS DESIGN
 	
            43
 

 

	
             
 	
            8.1
 	
            GENERAL REQUIREMENTS
 	
            43
 
	
             
 	
            8.2
 	
            PLC CONTROL SYSTEM HARDWARE DESIGN CRITERIA
 	
            43
 
	
             
 	
            8.3
 	
            PLC SYSTEM SOFTWARE
 	
            44
 
	
             
 	
            8.4
 	
            CABINETS, POWER SUPPLIES AND WIRING
 	
            45
 
	
             
 	
            8.5
 	
            CONTROL VALVE SPECIFICATION
 	
            45
 
	
             
 	
            8.6
 	
            GENERAL INSTRUMENT SPECIFICATION
 	
            46
 

 

	
            9.0
 	
            CIVIL, STRUCTURAL, AND ARCHITECTURAL DESIGN
 	
            47
 

 

	
             
 	
            9.1
 	
            GEOTECHNICAL REPORT (BY OTHERS)
 	
            47
 
	
             
 	
            9.2
 	
            CIVIL WORK CRITERIA
 	
            47
 
	
             
 	
            9.3
 	
            GROUTING OF ROTATING EQUIPMENT
 	
            51
 
	
             
 	
            9.4
 	
            DESIGN LOADS
 	
            51
 
	
             
 	
            9.5
 	
            STRUCTURAL DESIGN
 	
            54
 
	
             
 	
            9.6
 	
            CONSTRUCTION MATERIALS
 	
            55
 
	
             
 	
            9.7
 	
            BUILDINGS
 	
            57
 
					

 

	
            10.0
 	
            SPARE PARTS, SPECIAL TOOLS AND CONSUMABLES
 	
            61
 

 

	
             
 	
            10.1
 	
            SPARE PARTS
 	
            61
 
	
             
 	
            10.2
 	
            SPECIAL TOOLS
 	
            61
 
	
             
 	
            10.3
 	
            CONSUMABLES
 	
            61
 

 

	
            11.0
 	
            SUBMITTALS
 	
            62
 

 

	
            12.0
 	
            TESTING AND ACCEPTANCE
 	
            64
 

 

	
             
 	
            12.1
 	
            GENERAL
 	
            64
 
	
             
 	
            12.2
 	
            PRE-OPERATIONAL TESTING AND STARTUP
 	
            64
 
	
             
 	
            12.2.1
 	
            GENERAL SCOPE OF WORK
 	
            64
 
	
             
 	
            12.2.2
 	
            PROCEDURE
 	
            65
 
	
             
 	
            12.2.3
 	
            TURNOVER PACKAGES
 	
            65
 

 

	
            13.0
 	
            PLANT OPERATIONS AND MAINTENANCE
 	
            67
 

 

	
             
 	
            13.1
 	
            ANTICIPATED MANPOWER
 	
            67
 
	
             
 	
            13.2
 	
            OPERATIONS AND MAINTENANCE MANUALS
 	
            67
 

 

 

 

Page  2 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

1.0       INTRODUCTION 

 

	
             
 	
            1.1
 	
            This document provides the design criteria to be used by the Contractor in performing its responsibilities under the Contract. 
 

 

	
             
 	
            1.2
 	
            The Contractor shall furnish materials, equipment and services required to design, engineer, procure, construct, precommission, start-up, and test a geothermal electrical power plant with a 30 year design life. 
 

 

	
             
 	
            1.3
 	
            The following are definitions for the project participants. 
 

 

	
             
 	
            •
 	
            Contractor – refers to the EPC contractor who is responsible for the engineering procurement, construction and startup of the project. 
 

	
             
 	
            •
 	
            Company – refers to US Geothermal. 
 

	
             
 	
            •
 	
            Company’s Representative – refers to the Company’s engineer or any other party designated to represent the Company. 
 

	
             
 	
            •
 	
            Supplier – refers to a vendor or manufacturers that supplies material to the project under contract to the Contractor or Company. 
 

 

	
            2.0
 	
            BASIS OF PLANT OPERATION 
 

	
             
 	
            2.1
 	
            The plant shall be designed for an annual average availability of 97% for an expected availability of 8,497 hours per year. Scheduled overhauls shall be every 2 years for 7 days. 
 

 

	
             
 	
            2.2
 	
            The Contractor’s design shall provide a plant that facilitates stable operations and operating flexibility. 
 

 

 

 

 

Page  3 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

3.0          DESIGN CONDITIONS 

 

The Raft River Geothermal Project location is in Cassia, County Idaho, approximately 40 miles southeast of Burley, the county seat. Assets existing on this location include geothermal production and injection wells and monitoring wells. 

 

	
             
 	
            3.1
 	
            Legal Description for Power Plant Site No. 1
 

 

The power plant will be located approximately 15 miles south of Malta, Idaho. The facility shall be located on a parcel in the SW1/4 of the SE1/4 of Section 23, T.15S., R.26E., Boise Meridian, Cassia County, Idaho 

 

Elevation of the plant site is approximately 4,834 ft above sea level. 

 

	
            3.2
 	
            Seismic Zone 
 

 

The site is located in Seismic Zone C, as defined by the International Building Code. Seismic design for all new buildings and structures shall be in accordance with the IBC for earthquake with an importance factor of 1.0. Contractor is responsible for confirming the Seismic Zone designation and for conforming to all applicable code requirements. 

 

	
            3.3
 	
            Weather data 
 

 

Weather data is as follows: 

 

	
            Average barometric pressure
 	
            25.00 in Hg (12.28 psia)
 
	
            Maximum barometric pressure, design
 	
            27 in Hg
 
	
            Minimum barometric pressure, design
 	
            24 in Hg
 

 

	
            Ambient Weather Conditions – Based on Malta Agrimet data
 	
            Drybulb T
 	
            Wetbulb T1
 
	
            Annual average temperature
 	
            48°F
 	
            40°F
 
	
            Average temperature, coldest month in year
 	
            29°F
 	
            28°F
 
	
            Minimum winter temperature
 	
            -30°F
 	
            -17°F 
 

 

_________________________________

1 Wetbulb Temperatures calculated with a 20°F cut-off in calculation of averages. Wetbulb and drybulb maximum and minimum are not necessarily coincident. 

 

 

Page  4 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

                

	
            Temperature, warmest month in year
 	
            Avg       71°F
 	
            Avg       55°F
 
	
             
 	
            1st SD    85°F
 	
            1st SD    62°F
 
	
             
 	
            2nd SD   99°F
 	
            2nd SD   68°F
 
	
            Maximum summer temperature 
 	
            111°F
 	
            71°F
 

 

	
            Line tracing, design dry bulb temperature
 	
            -20°F
 
	
            Tank heating, design dry bulb temperature
 	
            -20°F
 
	
            Control building heating, design dry bulb temperature including control room
 	
            Maintain 68°F with - 30°F outside temperature
 
	
            Control Building Air conditioning
 	
            Maintain 82°F with 110°F outside temperature
 
	
            Building heating, design dry bulb temperature for unoccupied buildings.
 	
            40°F minimum with -30°F outside
 
	
            Maximum dry bulb temperature for compressed air system design
 	
            110°F
 
	
            Precipitation and Storms
 Maximum precipitation of storm/duration
 	
            2.0 in. per 24 hours
 
	
            Maximum monthly average rainfall
 	
            1.64 in. (May)
 
	
            Maximum rainfall in one hour
 	
            1.0 in
 
	
            Design rainfall
 	
            100 yearstorm event having a 24-hour duration (2.6 inches) per NOAA data
 
	
            Lightning storms
 	
            Common in summer
 
	
            Average annual rainfall 
 	
            11 inches
 
	
            Wind
 Average wind velocity
 	
            Approximately 10 mph
 
	
            Maximum wind velocity (gusts)
 	
            90 mph per IBC
 
	
            Direction of prevailing wind
 	
            Winter- SE, Summer – 240°
 (cooling system to be oriented to summer wind direction)
 
	
            Design wind pressure
 	
            IBC, 90 mph, Exposure C, Importance Factor 1.0
 
	
            Snow
 Design snow load
 	
            29 pounds per square foot per IBC
 
	
            Frost Depth per IBC
 	
            24 inches
 

 

 

 

Page  5 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
            Climate Zone per IBC
 	
            14B
 
	
             
 	
             
 

 

	
             
 	
            3.4
 	
            <Section 3.4 is not used>
 

 

	
             
 	
            3.5
 	
            Design Point Conditions and Required Plant Output
 

 

 

	
            Brine Flow (kph)
 	
            Brine Inlet Temperature (°F)
 	
            Wet Bulb
 (°F)
 	
            Net Power Plant Output
  (Net of all power plant internal loads, but exclusive of injection pump load)
 
	
            [ *** ] 
 	
            [ *** ] 
 	
            [ *** ] 
 	
            [ *** ] MW at [ *** ] power factor with the required fouling factors of Section 6, as measured at the high side of the step-up transformer and the electrical feed of the brine injection pumps
 

 

The Performance test calculation are based on “as clean” conditions, brine tubeside fouling factors in the heat exchanger of 0.0001, and on the shell side of the tubes and all non-brine containing tubes of 0.00005.  

 

Where power factor and plant output is specified, it will be measured at the high side of the step-up transformer and the electrical feed of the brine injection pumps.  

 

	
             
 	
            3.6
 	
            Process Design Criteria
 

 

	
             
 	
            3.6.1
 	
            Brine Source and Raw Water Chemistry
 

 

The brine supply and return chemistry is in mg/l as shown2

 

	
             
 	
             
 	
            Brine
 	
            Raw Water 
 
	
            Silica 
 	
            (SiO2) 
 	
            [ *** ]
 	
            [ *** ]
 
	
            Boron 
 	
            (B) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Sodium 
 	
            (Na) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Potassium
 	
            (K) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Lithium
 	
            (Li) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Calcium 
 	
            (Ca) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Magnesium 
 	
            (Mg) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Strontium
 	
            (Sr) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Arsenic
 	
            (As) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Chlorine 
 	
            (Cl) 
 	
            [ *** ]
 	
            [ *** ] 
 

 

______________________

2 Numbers shown in the list of chemical quantities are approximate and not binding. 

 

Page  6 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY

 

 

	
            Fluorine 
 	
            (F) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Sulfate 
 	
            (SO4) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Bicarbonate 
 	
            (HCO3) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Carbonate 
 	
            (CO3) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Carbon Dioxide 
 	
            (CO2) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Nitrogen 
 	
            (N2) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Hydrogen Sulfide 
 	
            (H2S) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Methane 
 	
            (CH4) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Argon 
 	
            (Ar) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Ammonia 
 	
            (NH3) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Hydrogen 
 	
            (H2) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            Total Dissolved Solids (TDS) 
 	
            [ *** ]
 	
            [ *** ] 
 
	
            pH (post flash) 
 	
             
 	
            [ *** ]
 	
            [ *** ] 
 

 

	
             
 	
            3.6.2 
 	
            Brine Flow Requirements  
 

 

The plant shall be capable of processing at least 110% of the Design Point Condition Flowrate. 

 

At the power plant boundary, as defined in Paragraph 3.1, conditions are projected to be as follows for the Design Point Condition Flowrate:  

 

Commodity                   Flowrate                     Pressure                           Temperature 

	
             
 	
            Brine Supply
 	
            [ *** ]
 	
            [ *** ]
 	
            [ *** ]
 	
             

	
             
 	
            Brine Return
 	
            [ *** ]
 	
            [ *** ] above
 	
            [ *** ] (min)
 
	
             
 	
            supply pressure3
 	
             

							

 

 

	
             
 	
            3.6.3 
 	
            Raw Water Supply:   
 

 

The raw water for cooling, service, seal, sanitation and fire supression will be delivered by the Company to the plant boundary. The Company will provide a bare pipe end buried to a depth of at least 24inches.. 

 

Commodity                   Flowrate                     Pressure                           Temperature  

	
             
 	
            Raw Water
 	
            Varies as needed
 	
            13 psig
 	
            50°
 
	
             
 	
            Supply
 	
            (the raw water
 	
             

	
             
 	
            system in the
 	
             

	
             
 	
            Facility will be
 	
             

	
             
 	
            designed to handle
 	
             

	
             
 	
            up to 1500 gpm)
 	
             

										

__________________________________

3Injection piping shall be designed for 350 psi minimum injection pump discharge pressure. 

4 This limit shall not apply during the performance test 

 

Page  7 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY

 

 

3.6.4       Plant Output and Additional Parasitic Loads  

 

The plant must achieve a net output per Paragraph 3.5 at the high side of the generator step-up transformer plus the electrical feed to the brine injection pumps. This net output condition must include all Facility pumps, including the following parasitic loads:  Building space conditioning, air compressors, in Plant raw water distribution, lighting inside the power plant facility, etc. Intermittent loads shall be averaged, and the average load accounted for in the net power output of the plant. 

 

 

 

 

Page  8 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

4.0          CODES AND STANDARDS 

 

	
             
 	
            4.1 
 	
            The design, manufacture and erection of equipment and systems shall be in accordance with governing Codes and Standards current at the time of contract award. 
 

 

	
             
 	
            4.2 
 	
            All applicable local, state and federal requirements shall be complied with by the Contractor. 
 

 

	
             
 	
            4.3 
 	
            The detailed design of each system and equipment specification shall contain reference to the specific code or standard to which the item is designed. In general, the following Codes and Standards should apply. 
 

 

	
             
 	
            4.4 
 	
            Any conflict between codes shall be referred to Company’s Representative for resolution. 
 

 

Standard Index Description 

 

	
            AASHTO
 	
            American Association of State Highway and Transportation Officials
 

 

	
            ACI
 	
            American Concrete Institute
 

 

	
             
 	
            a.
 	
            Building Code Requirements for Reinforced Concrete (ACI 318)
 	
             

	
             
 	
            b.
 	
            Building Code Requirements for Concrete Masonry  Structures (ACI 531-79)
 

 

	
            AGMA
 	
            American Gear Manufacturers Association AISC American Institute of Steel Construction
 

 

	
             
 	
            a.
 	
            Specification for the design, fabrication and erection of structural steel for buildings. 
 

 

	
            ANSI
 	
            American National Standards Institute
 	
             

	
            API
 	
            American Petroleum Institute
 	
             

	
            ASCE
 	
            American Society of Civil Engineers
 	
             

	
            ASHRAE
 	
            American Society of Heating, Refrigerating, and Air Conditioning  Engineers
 
					

 

 

Page  9 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
            ASME
 	
            American Society of Mechanical Engineers
 

 

	
             
 	
            a.
 	
            Boiler and Pressure Vessel Code, Sections II, VIII, IX
 
	
             
 	
            b.
 	
            Power Test Codes, as applicable
 	
             

	
             
 	
            c.
 	
            Power Piping Code 31.1
 	
             

					

 

	
            ASTM
 	
            American Society of Testing & Materials
 	
             

	
             
 	
            a.
 	
            Material Specifications as applicable
 	
             

	
             
 	
            b.
 	
            Sampling and Testing Standards as applicable.
 
					

 

	
            AWS
 	
            American Welding Society
 

 

	
            AWWA
 	
            American Water Works Association
 

 

	
            CAGI
 	
            Compressed Air and Gas Institute
 

 

	
            CTI
 	
            Cooling Tower Institute
 

 

	
            EPA
 	
            Environmental Protection Agency
 

 

	
            FM
 	
            Factory Mutual System
 	
             

	
             
 	
            a.
 	
            Handbook of Industrial Loss Prevention
 
	
             
 	
            b.
 	
            Factory Mutual Approval Guide
 	
             

	
             
 	
            c.
 	
            Loss Prevention Data
 	
             

						

 

	
            HI
 	
            Hydraulic Institute Standards
 

 

	
            IBC
 	
            International Building Code
 	
             

	
             
 	
            (Note, by the time of plant construction, the 2003 version is
 
	
             
 	
            expected to be in use by Cassia County)
 	
             

				

 

	
            IEEE
 	
            Institute of Electrical and Electronic Engineers
 

 

	
            ISA
 	
            Instrument Society of America
 

 

	
            MBMA
 	
            Metal Building Manufacturers Association Design Practices Manual
 

 

	
            MSS
 	
            Manufacturers Standardization Society
 

 

	
            NEMA
 	
            National Electrical Manufacturers Association
 

 

	
            NFPA
 	
            National Fire Protection Association
 	
             

	
             
 	
            a.
 	
            National Electrical Code (NEC)
 
				

 

 

Page  10 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            b.
 	
            Fire Protection Codes as appropriate
 

 

	
            OSHA
 	
            Occupational Safety and Health Act, (Latest Edition)
 

 

	
            SSPC
 	
            Structural Steel Painting Council
 

 

	
            TEMA
 	
            Tubular Exchanger Manufacturers Association
 

 

	
            TIMA
 	
            Thermal Institute Manufacturers Association
 

 

	
            UBC
 	
            Uniform Building Code
 

-NOTE: See also “IBC” 

 

	
            UL
 	
            Underwriters Laboratories, Inc.
 	
             

	
             
 	
            a.
 	
            UL Product Lists (where not FM listed)
 
				

 

 

Page  11 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
            5.0
 	
            GENERAL SCOPE OF WORK REQUIREMENTS
 

 

	
             
 	
            5.1
 	
            Introduction
 

 

The criteria presented herein shall apply to the scope of the work for a plant design life of 30 years. The work includes all systems and facilities inside the power plant boundary, and electrical tie-ins with the utility at the plant’s dead-end structure. Work external to the power plant facility will be performed by others. 

 

	
             
 	
            5.2
 	
            Contractor Engineering, Procurement, Construction, and Startup Scope
 

 

	
             
 	
            5.2.1
 	
            Engineering and design for this work shall include, but not be limited to, the following engineering and technical services: 
 

 

	
             
 	
            a.
 	
            Civil Design
 

	
             
 	
            •
 	
            Site drawing 
 

	
             
 	
            •
 	
            Site grading including site roads 
 

	
             
 	
            •
 	
            Site drainage sloped to on-site unlined pond of capacity for 100 yearstorm event with 24-hour duration. 
 

	
             
 	
            •
 	
            Containment areas for all equipment and bulk storage locations which contain oil or fuel, per the requirements of Section 9. 
 

	
             
 	
            •
 	
            Storm Water Pollution Prevention Plan, if required 
 

	
             
 	
            •
 	
            Sanitary system, including a leachfield system for distribution of sanitary effluent 
 

	
             
 	
            •
 	
            Soils reports (provided by others) review, and incorporation of results into final design 
 

	
             
 	
            •
 	
            Material and Fabrication Specifications 
 

	
             
 	
            •
 	
            Construction Specifications 
 

	
             
 	
            •
 	
            Site Survey (initial site survey provided by others) 
 

	
             
 	
            •
 	
            Area slabs on grade, spill containment, and sumps 
 

	
             
 	
            •
 	
            Area paving 
 

 

	
             
 	
            b.
 	
            Struc4tural Design
 	
             

	
             
 	
            •
 	
            Foundation Design, including cooling tower basin
 
	
             
 	
            •
 	
            Foundation location plan
 	
             

	
             
 	
            •
 	
            Mechanical and electrical equipment
 	
             

	
             
 	
            •
 	
            Buildings and sheds
 	
             

	
             
 	
            •
 	
            Transformer and miscellaneous electrical devices
 	
             

	
             
 	
            •
 	
            Miscellaneous platforms/ladders  
 	
             

	
             
 	
            •
 	
            Miscellaneous pipe and electrical supports
 	
             

	
             
 	
            •
 	
            Miscellaneous foundations
 	
             

	
             
 	
            •
 	
            Structural Steel Design –
 	
             

													

- Main pipe/electrical  raceway structural steel (pipe rack)  

-Cooling tower sump and pump area 

-Heat exchanger area steel 

-Miscellaneous platforms, stairways, handrail and grating 

-Area pipe supports 

-Area conduit supports 

-Miscellaneous structural supports 

 

 

Page  12 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

•              Technical Review of Vendor Fabrication Drawings 

	
             
 	
            •
 	
            Material and Fabrication Specifications
 
	
             
 	
            •
 	
            Construction Specifications
 	
             

 

	
             
 	
            c.
 	
            Mechanical Design
 	
             

	
             
 	
            •
 	
            Power Plant General Arrangement and Plot Plan
 	
             

	
             
 	
            •
 	
            Equipment specifications
 	
             

	
             
 	
            •
 	
            Equipment lists
 	
             

	
             
 	
            •
 	
            Piping design internal to the power plant boundary
 
								

-Working fluid supply 

-Working fluid return/storage/recovery 

-Cooling water supply 

-Cooling water return  

-Lube oil -Plant and Seal water 

-Instrument and Plant air  

-Firewater system including, pump and hydrant system 

-Miscellaneous systems 

	
             
 	
            •
 	
            Vendor document review and approval
 	
             

	
             
 	
            •
 	
            Pipe stress
 	
             

	
             
 	
            •
 	
            Piping Plans and sections
 	
             

	
             
 	
            •
 	
            Pipe material and fabrication specifications
 
	
             
 	
            •
 	
            Construction specifications
 	
             

	
             
 	
            •
 	
            Fire Protection (Sprinkler/Deluge) System
 	
             

								

 

	
             
 	
            d.
 	
            Electrical and Instrumentation
 	
             

	
             
 	
            •
 	
            One line diagrams
 	
             

	
             
 	
            •
 	
            Power Design
 	
             

	
             
 	
            •
 	
            Lighting and Freeze Protection  
 	
             

	
             
 	
            •
 	
            Control Logic Diagrams and narratives
 	
             

	
             
 	
            •
 	
            Loop Diagrams
 	
             

	
             
 	
            •
 	
            Electrical Schematics
 	
             

	
             
 	
            •
 	
            Connection Diagrams
 	
             

	
             
 	
            •
 	
            Instrument and I/O List
 	
             

	
             
 	
            •
 	
            Instrument Location Details
 	
             

	
             
 	
            •
 	
            Instrument Installation Details
 	
             

	
             
 	
            •
 	
            PLC Programming and Logic
 	
             

	
             
 	
            •
 	
            Conduit and Cable Schedules
 	
             

	
             
 	
            •
 	
            Grounding Design
 	
             

	
             
 	
            •
 	
            Lighting Design
 	
             

	
             
 	
            •
 	
            Raceway Diagrams
 	
             

	
             
 	
            •
 	
            Material and Fabrication Specifications
 
	
             
 	
            •
 	
            Construction Specifications
 	
             

	
             
 	
            •
 	
            Fire Detection
 	
             

	
             
 	
            •
 	
            Working Fluid Leakage Detection
 	
             

																						

 

	
             
 	
            e.
 	
            Architectural
 

 

 

Page  13 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            •
 	
            Control building design
 	
             

	
             
 	
            •
 	
            Prefabricated power distribution center building
 
	
             
 	
            •
 	
            Firewater pump house
 	
             

	
             
 	
            •
 	
            Mechanical Equipment Building
 	
             

						

 

	
             
 	
            f.
 	
            General Engineering
 

	
             
 	
            •
 	
            Supply all calculations necessary to perform the engineering scope of work. 
 

	
             
 	
            •
 	
            Idaho Professional Engineer Stamping of documents necessary to secure building permits. 
 

	
             
 	
            •
 	
            Supply record drawings, calculations, specifications, vendor documentation, installation instructions, operating procedures, maintenance manuals, and other relevant information for the Project Manuals. 
 

	
             
 	
            •
 	
            On site engineering and technical support, during the construction of the facility necessary to satisfy County building department requirements. 
 

	
             
 	
            •
 	
            Insurance 
 

	
             
 	
            •
 	
            Startup and Testing Procedures 
 

	
             
 	
            •
 	
            Performance Test Report 
 

 

	
             
 	
            5.2.2
 	
            Procurement services shall include but not limited to the following:
 

 

	
             
 	
            a.
 	
            Civil
 	
             

	
             
 	
            •
 	
            Imported fill, as required
 	
             

	
             
 	
            •
 	
            Crushed rock
 	
             

	
             
 	
            •
 	
            Road Base
 	
             

	
             
 	
            •
 	
            Culvert if needed internal to the power plant
 	
             

	
             
 	
            •
 	
            Temporary storm water control material (hay bales, erosion fencing)
 
									

 

	
             
 	
            b.
 	
            Concrete
 	
             

	
             
 	
            •
 	
            Structural concrete, 4000 psi
 	
             

	
             
 	
            •
 	
            Reinforcing steel
 	
             

	
             
 	
            •
 	
            Concrete embedments (anchor bolts, water stop, and misc. steel)
 
	
             
 	
            •
 	
            Structural and mechanical grout
 	
             

								

 

	
             
 	
            c.
 	
            Structural Steel
 	
             

	
             
 	
            •
 	
            Platforms, stairways/ladders, grating and handrail
 
	
             
 	
            •
 	
            Mechanical equipment supports
 	
             

	
             
 	
            •
 	
            Pipe rack support steel with finish coat paint
 	
             

	
             
 	
            •
 	
            Miscellaneous pipe/electrical supports
 	
             

								

 

	
             
 	
            d.
 	
            Mechanical
 	
             

	
             
 	
            •
 	
            All capital equipment listed or required in bidder’s scope of supply
 
	
             
 	
            •
 	
            Lubricants
 	
             

						

 

 

Page  14 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

e.         Piping 

	
             
 	
            •
 	
            Pipe and fittings
 	
             

	
             
 	
            •
 	
            Inline specialty devices
 	
             

	
             
 	
            •
 	
            Motor Operated Valves and control valves
 	
             

	
             
 	
            •
 	
            Expansion joints
 	
             

	
             
 	
            •
 	
            Pipe supports, clips, shoes, guides and anchors
 
	
             
 	
            •
 	
            Manual valves
 	
             

	
             
 	
            •
 	
            Miscellaneous piping material
 	
             

									

 

	
             
 	
            f.
 	
            Electrical, Instrumentation and Controls
 

	
             
 	
            •
 	
            Power cable 
 

	
             
 	
            •
 	
            Galvanized or Aluminum cable trays as required 
 

	
             
 	
            •
 	
            Instrument cable 
 

	
             
 	
            •
 	
            PLC 
 

	
             
 	
            •
 	
            Data Highway/Fiber Optics 
 

	
             
 	
            •
 	
            Instruments 
 

	
             
 	
            •
 	
            Instrument tubing 
 

	
             
 	
            •
 	
            Miscellaneous support materials 
 

	
             
 	
            •
 	
            Grounding cable 
 

	
             
 	
            •
 	
            Light fixtures and local receptacles 
 

	
             
 	
            •
 	
            Power and lighting buildings 
 

	
             
 	
            •
 	
            34.5KV Circuit breakers 
 

	
             
 	
            •
 	
            Step-up transformer to 34.5KV  
 

	
             
 	
            •
 	
            4,160 V Switchgear  
 

	
             
 	
            •
 	
            4,160V and 480V Transformers 
 

	
             
 	
            •
 	
            Prefabricated or on site erected power distribution center containing: 
 

	
             
 	
            •
 	
            Switchgear 
 

	
             
 	
            •
 	
            MCC’s 
 

	
             
 	
            •
 	
            Battery System (with dual chargers) 
 

	
             
 	
            •
 	
            Power Service Relays and Controls 
 

	
             
 	
            •
 	
            Revenue metering 
 

	
             
 	
            •
 	
            Lighting, devices, HVAC (100% recirculation), general purpose power, cable and raceways 
 

	
             
 	
            •
 	
            UPS system 
 

	
             
 	
            •
 	
            Emergency generator  
 

 

	
             
 	
            g.
 	
            Architectural
 

	
             
 	
            •
 	
            Prefabricated or on site erected electrical power distribution center. 
 

	
             
 	
            •
 	
            Control Building, complete with heating, ventilation, and air conditioning as required. Prefabricated is allowable. 
 

	
             
 	
            •
 	
            Firewater Pump House. 
 

	
             
 	
            •
 	
            Cooling water chemical treatment shed 
 

 

	
             
 	
            h.
 	
            General Construction
 	
             

	
             
 	
            •
 	
            Insurance per the Contract
 
					

 

 

Page  15 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            •
 	
            Construction Permits and Licenses (as per Exhibit G)
 
	
             
 	
            •
 	
            Initial Fluid Fills
 	
             

 

	
             
 	
            5.2.3
 	
            Construction and startup services shall include but not be limited to the following:
 
	
             
 	
            a.
 	
            Demolition
 	
             

	
             
 	
            •
 	
            No demolition work will be required.
 	
             

							

 

	
             
 	
            b.
 	
            Civil
 

	
             
 	
            •
 	
            Perform site clearing and grading 
 

	
             
 	
            •
 	
            Grade the site for drainage including plant retention pond. 
 

	
             
 	
            •
 	
            Install sanitary and leechfield system 
 

	
             
 	
            •
 	
            Finish grade the rest of the site 
 

	
             
 	
            •
 	
            Trenching as required for the installation of underground pipe and electrical ductbank. 
 

	
             
 	
            •
 	
            Structural excavation and backfill 
 

	
             
 	
            •
 	
            Soils compaction testing 
 

 

	
             
 	
            c.
 	
            Concrete
 

	
             
 	
            •
 	
            Installation of all foundations including anchor bolts and imbeds 
 

	
             
 	
            •
 	
            Installation of all grout and shims 
 

	
             
 	
            •
 	
            Concrete slump, cylinder and air testing as required per ACI   
 

 

	
             
 	
            d.
 	
            Structural Steel Installation
 

	
             
 	
            •
 	
            Install all structural steel platforms, stairways, ladders, supports, etc. 
 

	
             
 	
            •
 	
            Structural steel bolt tension test   
 

 

	
             
 	
            e.
 	
            Mechanical
 

	
             
 	
            •
 	
            Installation of all mechanical equipment     
 

	
             
 	
            •
 	
            Lubricants 
 

	
             
 	
            •
 	
            Mechanical Testing, Alignment and Run-in to mechanical completion (ready for introduction of the working fluid) 
 

	
             
 	
            f.
 	
            Piping
 

	
             
 	
            •
 	
            Installation of all onsite piping systems 
 

	
             
 	
            •
 	
            Pipe supports 
 

	
             
 	
            •
 	
            Pipe testing 
 

	
             
 	
            •
 	
            Clean and closure 
 

	
             
 	
            •
 	
            Tie-ins at as required 
 

	
             
 	
            •
 	
            X-ray Inspection 
 

	
             
 	
            •
 	
            Freeze protection 
 

 

	
             
 	
            g.
 	
            Electrical, Instrumentation and Controls
 

	
             
 	
            •
 	
            Installation of all electrical equipment (including the prefabricated power distribution center building) 
 

	
             
 	
            •
 	
            Installation of all the onsite conduit/tray and cable/wire
 	
             

	
             
 	
            •
 	
            Installation of 34.5 KV line to the dead-end wood pole and disconnect
 

 

 

Page  16 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

(provided by others) in the power plant switchyard. 

	
             
 	
            •
 	
            Installation and connection of required pole lights and task lights. 
 

	
             
 	
            •
 	
            Install and connect general purpose receptacles and welding outlets. 
 

	
             
 	
            •
 	
            Install and connect the grounding system including lightning protection 
 

	
             
 	
            •
 	
            Install and connect heat tracing where required. 
 

	
             
 	
            •
 	
            Install all instruments and control equipment 
 

	
             
 	
            •
 	
            Pre-operational testing and circuit verifications to mechanical completion (ready for introduction of the working fluid) 
 

	
             
 	
            •
 	
            Megger testing of all conductors 4,160V and above 
 

 

	
             
 	
            h.
 	
            Startup
 

	
             
 	
            •
 	
            Provide management and start-up personnel to perform the following using Company’s operations staff. 
 

	
             
 	
            •
 	
            Pre-operational commissioning and testing 
 

	
             
 	
            •
 	
            Operator and maintenance training (classroom and on-the-job training sufficient for competent operations after departure of Contractor from job site) 
 

	
             
 	
            •
 	
            Power plant startup and performance testing 
 

 

	
             
 	
            i.
 	
            Architectural/Insulation and Finishes
 
	
             
 	
            •
 	
            Buildings
 	
             

-Erect Control building 

-Erect prefabricated (packaged) or on site erected electrical building 

NOTE: The electrical and control buildings may be combined as one building. 

-Erect firewater pump , chemical treatment sheds, and mechanical equipment buildings. 

 

	
             
 	
            •
 	
            Insulation
 

-Pipe insulation (geothermal, water, pentane, and oil as required) 

-Valve insulation (4” and above) 

-Pentane vessels and turbines, except for condensers 

 

	
             
 	
            •
 	
            Finishes
 

-Finish paint non-insulated pipe 

-Structural steel and pipe supports 

 

	
             
 	
            j.
 	
            General
 

	
             
 	
            •
 	
            A comprehensive safety program, including pre-hire drug screening.
 

A site/project specific safety plan shall be implemented during construction. 

	
             
 	
            •
 	
            Quality Control program that is tailored to the needs of the work 
 

	
             
 	
            •
 	
            Project Management including the following services: 
 

-Safety Management 

-Quality Management 

 

 

Page  17 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

-Site Management 

-Site Security  

-Project Scheduling 

-Purchasing and Expediting 

-Warehousing, including offloading, inspection, and storage 

-Document control and Distribution 

-Subcontractor Management –

Technical Services 

	
             
 	
            •
 	
            Full time on site construction management 
 

	
             
 	
            •
 	
            Coordination and interfacing between Company, engineering, major vendors and construction 
 

	
             
 	
            •
 	
            Special instruments and services for performance testing 
 

 

	
             
 	
            5.3
 	
            Company short description of scope of work and responsibility:  
 

 

The following Company’s and others work which is excluded from Contractors’ work. More details are in the List of responsibilities, interface point table and list of permits as described in Exhibits A (Scope of Work Allocation) and G (Permits) of the EPC contract: 

 

	
             
 	
            a.
 	
            Topographic map of site with two foot contours 
 

	
             
 	
            b.
 	
            Full and comprehensive geotechnical report, including soil resistivity analysis. 
 

	
             
 	
            c.
 	
            Design, supply and construction of all gathering and injection systems to the power plant boundary (wells, production and injection lines, down hole well pumps, raw water wells and pipe line etc.) 
 

	
             
 	
            d.
 	
            Raw water and geothermal water in capacity enough for pipe cleaning and hydrotesting 
 

	
             
 	
            e.
 	
            Supply of and interconnection of the power plant deadend structure(s). 
 

	
             
 	
            f.
 	
            Permits per Exhibit G 
 

	
             
 	
            g.
 	
            Operating personnel for pre-commissioning, testing and operation 
 

	
             
 	
            h.
 	
            Start up Commissioning and operation of gathering system, raw water, blow down lines and wells 
 

	
             
 	
            i.
 	
            Raw water well, tank, piping, and electrical to the plant boundary (fence). 
 

	
             
 	
            j.
 	
            Blow down pumping station, if required above condenser discharge pressure. 
 

	
             
 	
            k.
 	
            Company will pay for all construction and startup water and electricity. 
 

	
             
 	
            l.
 	
            Contractor is responsible for all temporary and permanent work to use the water and power on the site. 
 

	
             
 	
            m.
 	
            Chemicals for water treatment system including initial fill up. 
 

	
             
 	
            n.
 	
            Design and supply Water treatment system. 
 

	
             
 	
            o.
 	
            Design, supply and construct Utility interconnection facility and transmission line. 
 

	
             
 	
            p.
 	
            Existing access roads 
 

	
             
 	
            q.
 	
            Spare parts. 
 

	
             
 	
            r.
 	
            Clear, clean and disposal all hazardous materials not introduced to the site by contractor. 
 

 

 

Page  18 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
            6.0
 	
            MECHANICAL DESIGN 
 

 

Reasonable provisions for performance of routine and nonscheduled maintenance shall be included in the design of mechanical systems without requiring that the operating of the plant or the geothermal field be shut down. Examples of such provisions include but are not limited to isolation valves on pumps, heat exchangers and other equipment to provide operating flexibility and increase plant availability/reliability. All equipment exposed to geothermal fluids shall not contain materials, which experience rapid corrosion in a hydrogen sulfide environment or in the working fluid of the power plant. 

 

	
             
 	
            6.1
 	
            Piping Design
 

 

	
             
 	
            6.1.1
 	
            Design Standards
 

 

All power process and brine piping design will be done in accordance with the standards set forth in ASME B31.1 

 

Instrument air distribution piping shall be designed and built according to ISA specifications. The piping shall be a welded system. Filters are to be used upstream of all instrument air users when corrosion resistant pipe is not used. All subheaders shall come off the top of the main header.  

 

Other services shall be designed according to the appropriate code. 

 

Relief valves shall not be used except to protect against extreme or extraordinary upset conditions. 

 

All brine piping shall be designed to include the conditions that may exist for startup of the power plant, including any pipe and brine pumps that will see brine inlet temperatures before the turbine is synchronized. The maximum brine design temperature is 310°F. 

 

	
             
 	
            6.1.2
 	
            Line Sizing
 

 

All process lines shall be sized in accordance with process requirements and good engineering practice. Liquid lines will be sized large enough to avoid excessive velocity. For design purposes, a safety factor of 10% will be included in the pressure drop calculations of major process lines. 

 

Pump suction and discharge lines and equipment shall be designed for the maximum pressures and temperatures to which they will be subjected by the pump at the design flow plus 10% flow, including deadhead condition. 

 

Geofluid piping shall be sized for the design flow rate plus 10%, with 1/8” (0.125”) of rough geothermal scale on the pipe walls. 

 

Page  19 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            6.1.3
 	
            Materials of Construction 
 

 

Piping materials shall be suitable for geothermal service. No copper or copper bearing alloys shall be allowed to contact geothermal fluids. Lines carrying geofluids shall have a 1/8 inch corrosion allowance. 

 

Cooling water piping may be FRP, HDPE, or other non-corrosive material, or carbon steel with a 1/8 inch corrosion allowance. Buried carbon steel pipe shall have a high-quality and proven external corrosion protection for carbon steel pipe. 

 

	
             
 	
            6.1.4
 	
            Pipe Supports 
 

 

Pipe shall be supported in pipe racks or “T” supports or other permanent support designs. “Sleeper” supports set on the ground shall not be used  

 

All pipe racks and supports shall have capability for at least one additional 12” insulated pipe, or one additional pipe of the largest size, if all pipes in the rack are smaller than 12”. The additional pipe must be able to be installed without moving the other pipes on the rack. 

 

Any deviations from this requirement must be submitted to Company for approval prior to final design documents being issued for construction. 

 

	
             
 	
            6.1.5
 	
            Routing
 

 

Clearance and access shall be maintained around all equipment. Detailed access requirements are provided in Paragraph 6.2. 

 

	
             
 	
            6.1.6
 	
            Stress Analysis
 

 

	
             
 	
            6.1.6.1
 	
            Basic Requirements
 

 

All piping systems shall be designed considering the effects of thermal transients, dead and live loads, seismic events, wind loads, pressure, and flow for start-up, normal operating, shutdown and definable upset conditions in accordance with the codes referenced in this section. Calculations shall be based on an assumed standard ambient temperature and they shall take into account the temperature extremes that will exist at the site. 

 

Applicable Codes: 

 

ASME B31.1 “Power Piping” 

 

IBC “International Building Code” 

 

Page  20 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            6.1.6.2
 	
            Load Limitations on Equipment
 

Pumps - All pump nozzles shall be capable of withstanding the forces and moments defined in the pump specifications and in accordance with the manufacturer’s requirements. 

 

Turbines -Preliminary nozzle loads will be coordinated with the manufacturer prior to design of the piping. Final loads shall be reviewed with the turbine manufacturer before shipment. 

 

Heat Exchangers - All heat exchanger nozzles shall be capable of withstanding the forces and moments defined in a table to be included in the heat exchanger specifications. 

 

	
             
 	
            6.1.6.3
 	
            Method of Analysis
 

 

Systems as listed below shall be analyzed by simplified, approximate or comprehensive methods of analysis that are appropriate for the specific case. Formal computer stress analyses shall be performed on the following lines: 

 

	
             
 	
            •
 	
            Lines to and from all rotating equipment greater than two inches nominal diameter. 
 

	
             
 	
            •
 	
            All working fluid and brine lines above 6”.
 
	
             
 	
            •
 	
            All cooling water lines above 14”.
 	
             

 

All computer stress analysis input and output shall be provided to the Company. 

 

	
             
 	
            6.1.6.4
 	
            Seismic Analysis
 

 

Piping systems shall be analyzed for static seismic reactions. 

 

	
             
 	
            6.1.6.5
 	
            Wind Loads
 

 

Piping systems located outdoors shall include wind loading in the calculations. 

 

Supports and/or pipe racks shall be designed for wind load in outdoor locations. However, wind loads need not be considered as acting concurrently with seismic and vice versa. 

 

	
             
 	
            6.1.6.6
 	
            Differential Settlement
 

 

Stress analysis shall take into account the effects of differential settlement as indicated in the geotechnical report. 

 

Page  21 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

6.1.7       Insulation and Freeze Protection 

 

One inch of insulation (minimum) over electrical tracing shall be provided for all lines 2” and under which are exposed to winter temperatures below freezing and which cannot be drained during shutdowns or are stagnant during normal operations. Exposed deadlegs over 2” are not allowed. Lines over 2” which are inherently subject to freezing shall be freeze protected on a case-by-case basis. 

 

The Contractor shall design provisions for freeze protection of the plant equipment if power to the plant is lost during a severe winter storm which results in a multi-day outage.  

 

	
             
 	
            6.1.8
 	
            Isolation Requirements
 

 

The piping system shall be designed to be appropriately isolated for maintenance. This means isolation and a drop-out spool, from all sources of energy such as the main geofluid line into the plant and working fluid storage. Drop out spools must be accessible from ground level or a working platform.  

 

Working fluid power process pumps, fire pumps, and brine pumps shall have upstream and downstream isolation valves so that the entire system does not have to be drained in order to effect their removal for maintenance.  

 

	
             
 	
            6.1.9
 	
            Metering runs
 

 

Wherever a flow meter is required, the piping shall be layed out to meet ASME and ISA meter run requirements. Per these specifications, there shall be sufficient straight pipe upstream and downstream of the meter based on the elbow configuration at the inlet and outlet of the meter run. 

 

Piping diameter upstream and downstream of the brine meter shall be measured to the requirements of the ASME and ISA code if required to do so. 

 

The following flow meters are required:  

 

	
             
 	
            •
 	
            Brine flow into the plant is to be measured with a venturi flow meter.
 	
             

	
             
 	
            •
 	
            Other flow meters as shown in the P&ID’s of the EPC Contract, Exhibit C.
 

 

	
             
 	
            6.1.10
 	
            X-Ray Inspection
 

 

Pipe shall be inspected by X-ray testing of 5% random (full circumferential and/or bottom only) with testing two other welds with each failure. Tests to be conducted per ASME B31.1, including repair 

 

 

Page  22 of 68 

	
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            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

and follow-up inspection procedures for failed tests.

 

	
             
 	
            6.1.11
 	
            Preoperational System Cleaning
 

 

Prior to placing in operation, the piping system shall be cleaned as follows: 

 

	
             
 	
            •
 	
            Vapor lines upstream of the turbines shall be cleaned mechanically or via blows. Cleaning procedures shall be reviewed by Company. 
 

	
             
 	
            •
 	
            All other process piping systems shall be cleaned by flushing mechanically or temporary flushing connections and piping shall be installed as necessary. 
 

	
             
 	
            •
 	
            Air system piping shall be cleaned by air blow to the atmosphere with full compressor flow to each leg of the air distribution system, or by ISA recommended procedure. 
 

	
             
 	
            •
 	
            Turbine lubricating oil systems shall be cleaned in accordance with the manufacturer’s instructions and requirements. 
 

	
             
 	
            •
 	
            Temporary startup strainers with provisions for debris and eventual strainer removal shall be provided upstream of all pumps and the turbine(s). Turbine(s) and pumps will not operate over the long term with a strainer in place. 
 

 

	
             
 	
            6.2
 	
            Plant Layout Requirements
 

 

	
             
 	
            6.2.1 
 	
            All pumps will be located at grade, and may not be located in below-grade pits or sumps. 
 

 

	
             
 	
            6.2.2 
 	
            Maintenance access must be maintained around all rotating equipment and heat exchangers. Maintenance access includes: 
 

 

	
             
 	
            •
 	
            The ability to drive a service vehicle next to the equipment 
 

	
             
 	
            •
 	
            Ability to remove any pump or control valve with a suitable crane. 
 

	
             
 	
            •
 	
            Ability to remove the turbine equipment. 
 

	
             
 	
            •
 	
            Adequate maintenance space and platforms provided around equipment that need frequent maintenance. 
 

	
             
 	
            •
 	
            Space at least at one end of every heat exchanger sufficient to retube the exchanger without moving or removing the heat exchanger shell.  
 

	
             
 	
            •
 	
            Maintenance and operations ladders shall be provided for frequently maintenance equipment. Ladders design will be per OSHA requirements. 
 

 

	
             
 	
             6.2.3
 	
             All pumps that are not set-up as 2 x 50% or 2 x 100% shall be laid-out such that there is sufficient space to retrofit an additional pump in the future. The location of the additional pump shall be shown on the plant layout drawings with appropriate markings to designate that it is intended for future installation. 
 

 

Page  23 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

6.3          Mechanical Equipment Design Criteria 

 

	
             
 	
            6.3.1
 	
            Geofluid-Working Fluid Heat Exchangers 
 

 

These exchangers shall be shell-and-tube design per TEMA C. Plate and frame or U-tube designs shall not be used in brine service. The geofluid shall be on the tube side with a fouling factor of 0.002. The fouling factor on the shell side shall be 0.0005. The corrosion allowance (unless corrosion resistance materials are used) shall be 1/16 inch for all wetted surfaces on both sides except for the tubes which shall be 1/32 inch on the geofluid side and 0.0 on the working fluid side. Copper or copper bearing alloys shall not be used for any tubes. 

 

	
             
 	
            6.3.2
 	
            Water Cooled Heat Exchangers 
 

 

These exchangers shall be shell and tube design per TEMA C. The water shall be on the tube side with a fouling factor of 0.001. The fouling factor on the shell side shall be 0.0005. The corrosion allowance (unless corrosion resistance materials are used) shall be 1/16 inch for all wetted surfaces on both sides except for the tubes which shall be 1/32 inch on the cooling water side and 0.0 on the working fluid side. Copper or copper bearing alloys shall not be used for any tubes. Tube material shall be 316L, 318L, Alloy 2205, or as approved by Company. 

 

	
             
 	
            6.3.3
 	
            Cooling Tower
 

 

	
             
 	
            6.3.3.1
 	
            Basic Tower Design Requirements
 

 

Cooling towers shall be counter flow with low clog or moderate efficiency fill. High efficiency fill shall only be used if water quality analysis by Contractor indicates it is feasible, and such use is approved by Company in writing. The cooling tower structure shall be FRP. Bolting hardware shall be 304 SS, or better. 

 

One access stairway and one ladder shall be supplied to the cooling tower operating deck. Deck lighting shall be provided. A handrail shall be provided around the perimeter of the deck. 

 

The drift shall be no more than 0.005% of circulating water flow.  

 

Freeze protection methods appropriate to the location must be supplied, and shall consist at a minimum of variable speed drives for each fan motor. 

 

The cooling tower shall be oriented to minimize recirculation and fallout on the substation or other plant equipment. Maximum separation between the cooling tower and the substation shall be provided in the layout. 

 

Page  24 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            6.3.3.2
 	
            Fans, Motors and Stacks 
  

 

Cooling tower motors shall be TEFC. The drive shafts shall be stainless steel or composite. Composite drive shafts shall be provided with an erosion resistant finish to protect the fibers. Fans shall be manually adjustable pitch at stand still. Fan stacks shall be velocity recovery design. Fan to fan stack clearance shall meet fan manufacturer specification. All structural steel and steel equipment cases (e.g. gear box and motors) shall have a coating system appropriate to wet corrosive environment. 

 

	
             
 	
            6.3.3.3
 	
            Cooling Tower and Cooling Tower Chemical Treatment Area Auxilliary Equipment 
 

 

	
             
 	
            •
 	
            The cooling tower pump pit design shall include the capacity for removable pump screens, per the requirements of Section 9.2.8. 
 

 

	
             
 	
            •
 	
            Pre-insulated and heat-traced bulk chemical storage tanks with ultrasonic level instruments, seismic restraints, fill lines, and accessories will be provided by Company, and installed by Contractor per the requirements of Section 9.2. 
 

 

	
             
 	
            •
 	
            Chemical injection pumps, chemical piping, and freeze protection shall be provided by Company and installed by Contractor per the requirements of Section 9.2. 
 

 

	
             
 	
            •
 	
            Contractor will provide power and instrument connections necessary for the operation of the heat tracing and to tie the Company-supplied instrumentation into the PLC. 
 

 

	
             
 	
            6.3.4
 	
            Process Pumps
 

 

	
             
 	
            6.3.4.1
 	
            General Requirements
 

 

Process Pumps, including pumps that handle brine, shall be ANSI. All pumps are to have spares as specified below. All pump flanges shall be raised face.  

 

	
             
 	
            6.3.4.2
 	
            Materials of construction
 

 

	
             
 	
            •
 	
            No cast iron pumps will be allowed in a hydrocarbon service.  
 

	
             
 	
            •
 	
            Brine pump materials shall have a proven history of geothermal service.  
 

	
             
 	
            •
 	
            Cooling water and service water pumps shall be cast iron with bronze impellers. 
 

 

	
             
 	
            6.3.4.3
 	
            Mechanical Seals
 

 

Pumps shall have mechanical seals with the exception of cooling water circulation pumps located in a cooling tower basin. Pumps in brine service shall have a clean water flushing system for the mechanical seals. Mechanical seals 

 

Page  25 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

shall be single or double type cartridge seals appropriate for the service. They shall be the product of an established manufacturer and shall be designed for high reliability.  

 

	
             
 	
            6.3.4.4
 	
            NPSH Requirements
 

 

Except for the OEC feed pumps the NPSH available shall be at least 25% more than the NPSH required at the maximum flow conditions (including the pump capacity requirements, below) at the pump inlet flange. All pumps, shall be designed with at least 5 pipe diameters of straight pipe upstream of the pump suction. 

 

	
             
 	
            6.3.4.5
 	
            Pump Capacity Requirements
 

 

All centrifugal pumps shall be sized to meet the flow and pressure requirements of the design and off-design cases (including a 10% increase in brine flow and its resultant increase in heat exchanger pressure drop, and the plant output specifications for Winter Daily Minimum Temperature in Section 3.5. The pumps shall provide a design capacity 10% greater than the maximum operating requirement at the operating differential head. The impeller diameter shall be at least 1 inch smaller than the maximum allowable impeller diameter for the selected model. The pump curve shall be continuously rising from cut-off to shutoff. The design point shall be to the right of the best efficiency point. 

 

	
             
 	
            6.3.4.6
 	
            Pump and spares shall be as follows:
 

 

The design philosophy of this section is to minimize capital costs while providing sufficient reliability for the plant to meet its pro-forma requirements of 97% annual average capacity factor. Alternate proposals that achieve this objective may be submitted for approval to the Company. 

 

	
             
 	
            •
 	
            Brine pumps shall be vertical pumps with 4160V motors and shall be 2 x 50% each. 
 

	
             
 	
            •
 	
            Working fluid process pumps:  2 x 50% with no spare required for warehouse stock. 
 

	
             
 	
            •
 	
            Seal water and service water pumps: 2 x 100%. No spares required for warehouse stock. 
 

	
             
 	
            •
 	
            Oil pumps:  Redundant A/C pumps and air-driven pumps for both the lube oil and seal oil systems. 
 

	
             
 	
            •
 	
            Cooling water pumps:  2 x 50%. No spares required for warehouse stock. 
 

	
             
 	
            •
 	
            Miscellaneous pumps: 1 x 100%. No spares required. 
 

	
             
 	
            •
 	
            Fire pumps per Section 6.3.11. 
 

 

For all pumps, the quality must be sufficient for an expected operating life of several years without failure. 

 

Installed paired pumps (2 x 100% or 2 x 50%) shall be designed with isolation 

 

Page  26 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

valves to allow the removal of one pump while the power plant remains on line and generating power. 

 

Spare motors and pump parts will be acquired under the Company’s spare parts budget, and do not need to be included in the warehouse spare requirements as described above. 

 

	
             
 	
            6.3.5
 	
            Turbine, Generator, and Gear Box
 

 

The vendor shall supply a complete functional turbine generator system. 

 

	
             
 	
            6.3.5.1
 	
            General Requirements
 

 

Turbine and generator shall be designed to produce the power requirements of Paragraph 3.5 at the high side of the step-up transformer. The electrical generation system shall also be designed in the same way.  

 

The turbine will be multistage axial flow, suitable for geothermal service and the process fluids. The materials shall be adequate for the intended service and life expectancy. The turbine shall have a stop valve and control valve in series with a startup strainer. The piping and strainer shall be designed so that the strainer may be removed after commissioning. Turbine flanges shall be designed to withstand full NEMA forces.  

 

The generator enclosure shall be WPII and may be air or water cooled.  

 

The lube oil system shall have duplex filters with a differential pressure indication and switchable on-line. Necessary cooling and heating of the oil system shall be provided. The lube oil piping shall be stainless steel downstream of the filters.  

 

	
             
 	
            6.3.6.2
 	
            Turbine Control and Monitoring Requirements
 

 

The turbine-generator system shall have  

 

	
             
 	
            •
 	
            The turbine control system shall be a Woodward electronic, or may be controlled with the plant control system PLC if the Contractor or Supplier has experience with such a design. Turbine control via PLC is preferred but shall include Contractor support for 3-years after startup. Alternatives may be proposed for approval by the Company.  
 

	
             
 	
            •
 	
            The turbine controls shall be capable of controlling the turbine speed to 125% of the rated speed in the event of a full-load trip, and to a maximum speed rise of 113% of the rated speed in the event of a full-load run-back to house load. 
 

	
             
 	
            •
 	
            The system shall be equipped with an automatic synchronizer and generator protective relaying system. The generator system shall contain voltage regulation and VAR control. 
 

	
             
 	
            •
 	
            The turbines shall be equipped with SKF Machine Conditioning 
 

 

 

Page  27 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

Transmitters (MCT) The Generator shall be equipped with PMX vibration transmitter  and Bently Nevada vibration X-Y probes, proximate units and key-phasor to allow local analysis. Vibration level display in the control room shall be by local display, PC, or PLC. 

	
             
 	
            •
 	
            The turbine and generator controls shall be displayed in the control room with a local instruments for monitoring the system.  
 

	
             
 	
            •
 	
            Shaft-driven main oil pumps are preferred and allowed, but not required. 
 

 

The turbine/generator system shall be capable of running back to house load in the event of a full-load transmission line breaker trip.  

 

	
             
 	
            6.3.7
 	
            Rotating equipment installation requirements
 

 

	
             
 	
            •
 	
            Grouting requirements are defined in the Civil Specification, Section 9. 
 

 

	
             
 	
            •
 	
            Rotating equipment shafts shall be aligned for angular and offset alignment by reverse dial indicator or laser method. Rotating equipment except for turbine systems shall not have indicated run-out of more than 0.003 inches and angular misalignment of more than 0.0005 inches per inch of dial indicator separation. Turbine system alignment shall conform to the manufacturers specifications. 
 

 

	
             
 	
            •
 	
            Alignment shall be performed by a specialist (Contractor or vendor). 
 

 

	
             
 	
            •
 	
            Company shall be notified at least 48 hours prior to both the grouting and the alignment being performed, so that Company can witness. 
 

 

	
             
 	
            6.3.8
 	
            Working fluid storage requirements: An ASME storage tank shall be provided sized to hold 75% of the complete inventory of working fluid. The system shall contain at least one working fluid transfer pump that is either hard-piped to all accumulation points, or is portable and can be moved from location to location. 
 

 

	
             
 	
            6.3.9
 	
            Air Emissions and NCG vent system requirements The non-condensable vent system from the condenser and/or other locations shall contain a vapor recovery system sized at least as large as a reasonable winter air infiltration rate.
 

 

	
             
 	
            6.3.10
 	
            Compressed Air System 
 

 

The facility will be provided with a package air compressor system to provide clean dry compressed air for instrumentation only. 

 

The compressed air system shall consist of the following: 

 

	
             
 	
            •
 	
            Two (2) x 120% capacity air compressors with automatic start controls on different set pressures and lead/lag control. 
 

	
             
 	
            •
 	
            Inlet filter 
 

	
             
 	
            •
 	
            One air receiver. 
 

	
             
 	
            •
 	
            Coalescing prefilter and afterfilter. 
 

	
             
 	
            •
 	
            Duplex desiccant air dryer, heated type. 
 

 

 

Page  28 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            •
 	
            Instrument air headers.
 

 

Screw or reciprocating compressors may be used. 

 

The air compressors shall be of identical type and rating. The compressed air shall be oil free. 

 

The two identical compressors shall be used in parallel and each compressor shall be sized for the combined maximum instrument air load of all equipment plus 15%. 

 

Provisions shall be made for each compressor to automatically back up the other compressor in the system. 

Instrument air dryer shall be a twin tower desiccant, heated regeneration type. 

 

Instrument air shall be dried to a minus 40 degree °F dew point and shall be supplied at 100 psig nominal pressure (min). 

 

The instrument air supply shall require filtration. 

 

The ASME-stamped air receiver shall be designed for a supply pressure of 125 psig from the compressors. A common discharge line shall be provided for air compressors downstream of the aftercoolers. 

 

The packaged air compressor system shall include electrical breakers, controls and monitoring equipment. 

 

	
             
 	
            6.3.11
 	
            Fire Protection System
 

 

The power plant site shall be supplied with a fire protection system. The system shall comply with applicable NFPA requirements. An underground firewater loop shall be provided complete with hydrants with hose houses and monitors at strategic locations to provide required coverage of the site and its open and enclosed facilities.  

 

The source for the fire protection water shall be the cooling tower basin. After the EPC Notice to Proceed, and during the detailed design review, an alternative method to supply fire protection water from the cooling tower make-up line when the cooling tower basin is empty shall be investigated by the Company and the Contractor, with such alternatives subject to a Change Order if implemented. 

 

Piping, equipment and materials shall be suitable for the liquid being pumped and local soil corrosivity conditions. 

 

The fire system design shall have one diesel fire pump of a capacity in 

 

Page  29 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

accordance with NFPA requirements but not less than 1500 gpm each at 120 psi differential. System pressure shall be maintained with a jockey pump. Electrical, piping, and space shall be provided for a second spare electric or diesel fire pump. 

 

Manually operated deluge systems will be installed to protect the individual turbine lube oil systems, and turbine bearings. Deluge system will include heat or smoke detectors for alarm and the means for manual activation of the deluge system at a safe distance from the equipment being protected. 

 

A fire protection panel shall be installed in the control room for monitoring the fire protection system. 

 

The fire pumps shall be housed in a building. Heating and ventilation shall be provided in accordance with NFPA, and the unoccupied building requirements of this specification. 

 

Fire protection water for all enclosed facilities shall be supplied from the fire water loop. In addition to the detection equipment for deluge systems, smoke detectors shall be installed at strategic locations in the control room, prefabricated electrical building, and fire water pump house. All detectors shall be monitored on the protection panel in the control room. 

 

The system shall include: 

 

• Diesel driven fire water pump 

• Electric driven jockey pump 

• Main fire water loop 

• Storage Tank (or cooling tower basin) 

• Manual deluge system for individual turbine lube oil systems. 

• Manual deluge system for main transformers. 

• Hydrants 

• Heat/smoke detectors. 

• Monitoring panel. 

 

Fire water loop shall extend to the turbine area with hydrant locations and branches to deluge systems as required. A jockey pump shall pressurize the system. 

 

Each hydrant shall have a hose house on a concrete pad. 

 

Post indicating valves shall be provided on the fire water main line to isolate portions of the fire protection system in case of a line break or hydrant break. 

 

All systems shall be engineered, designed, and constructed in accordance 

 

Page  30 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

with NFPA requirements.

 

	
             
 	
            6.4
 	
            Utility Systems
 

 

	
             
 	
            6.4.1
 	
            Service Water System 
 

 

The power plant design shall include an underground utility water system which will distribute water to two hose bibs on opposite sides of the power block, a hose bib in the chemical treatment area, to the brine injection pump mechanical seals, sanitation, cooling water make-up and other in-plant uses. Freeze avoidance and protection is required. One hose cart with 200 feet of industrial grade hose shall be supplied.  

 

Raw water shall be supplied to the power plant boundary in a single pipeline from Company’s existing fire water tank at the old Raft River power plant site. Water will be available at the conditions specified in Section 3.6.3. 

 

	
             
 	
            6.4.2
 	
            Plant Service Air System
 

 

A plant service air system is not required.  

 

	
             
 	
            6.4.8
 	
            Potable Water System
 

 

A potable water system will not be installed. Water for sanitary uses will be from the raw water system supplied by the Contractor. The water system shall be set up for a future potable water tank. 

 

	
             
 	
            6.4.9
 	
            Sanitary Sewage Disposal
 

 

Sanitary sewage from the plant shall be collected and handled through a septic tank and leach system. The system shall be designed in accordance with the Uniform Plumbing Code and per Cassia County, Idaho and Idaho State requirements. See Section 13 for the number of personnel in order to size the system. 

 

	
             
 	
            6.5
 	
            Other Plant and Facility Design Criteria
 

 

	
             
 	
            6.5.1
 	
            Acoustic Criteria
 

 

All Equipment shall comply with Occupational Safety and Health Administration U.S. Department of Labor (OSHA) Standard for General Industry Section 1910.95. 

 

The maximum noise generated by any individual equipment should not exceed 85 decibels as measured on the A scale at a distance of 3 feet. 

 

Page  31 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

If the specified noise level is exceeded, the engineering, design, and material for noise controls, e.g., lagging, silencers, and enclosures, as required to achieve compliance will be provided or signs shall be placed at areas and equipment enclosures where ear protection is required. 

 

OSHA 1926.52 

Permissible Noise Exposures Table 

	
             
 	
            Duration per Day (Hour) 
 	
            Sound Level dBA 
 

	
             
 	
            8 
 	
            90 
 

	
             
 	
            6 
 	
            92 
 

	
             
 	
            4 
 	
            95 
 

	
             
 	
            3 
 	
            97 
 

	
             
 	
            2 
 	
            100 
 

	
             
 	
            1 1/2 
 	
            102 
 

	
             
 	
            1 
 	
            105 
 

	
             
 	
            1/2 
 	
            110 
 

	
             
 	
            1/4 
 	
            115 
 

	
             
 	
            6.5.2
 	
            H2S and Corrosion Protection 
 

 

When hydrocarbon working fluids are used, atmospheric corrosion does not need to be considered. 

 

Corrosion protection is required for atmospheric corrosion due to geofluid and geofluid condensate exposure. 

 

Aluminum is not to be submitted substituted for copper in wire or bus bars. 

 

	
             
 	
            6.5.3
 	
            Heating, Ventilating and Air Conditioning
 

 

The heating ventilating and air conditioning systems will be designed according to the following codes: 

 

	
             
 	
            a.
 	
            American Society of Heating, Refrigeration and Air Conditioning Engineers (ASHRAE) 
 

	
             
 	
            b.
 	
            Air Moving and Conditioning Association (AMCA Standard) 
 

	
             
 	
            c.
 	
            Air Conditioning and Refrigeration Institute (ARI) 
 

	
             
 	
            d.
 	
            Underwriters’ Laboratory (UL) 
 

	
             
 	
            e.
 	
            National Fire Protection Association (NFPA) 
 

	
             
 	
            f.
 	
            Uniform Building Code 
 

 

The HVAC system shall be mounted at grade. Window units are not acceptable. The compressor shall be a SEER 12 or better.  

 

Building space conditioning temperature requirements are per Section 3.4 for both occupied and unoccupied spaces. 

 

 

Page  32 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

Air distribution devices shall not create air velocities in excess of 50 fpm in the 5-foot zone of occupancy. Exhaust air quantities shall be determined by code requirements or by air changes per hour method. 

 

Electric switchgear and/or instrumentation equipment rooms shall have a total recirculation air conditioning system. 

 

The control room fresh air inlet shall be filtered for dust. The filters are to be accessible and easily changed. 

 

	
             
 	
            6.5.3
 	
            Plumbing 
 

 

Domestic hot and cold water, drains and vents shall be provided for plumbing fixtures. Domestic hot water heaters shall be electric on-demand devices Fixtures will include water closets, urinals, lavatories, mop receptor, floor drains, and roof drains. Copper or bronze plumbing fittings, tubing or pipe shall not be used. 

 

Roof drains shall be sized per Uniform Plumbing Code. 

 

	
             
 	
            6.5.4
 	
            Safety Showers 
 

 

Two safety shower/eye wash units shall be provided at the OEC and water treatment areas as required. Freeze protection is required, preferably by actuation of an underground valve. 

 

	
             
 	
            6.5.6
 	
            Insulation System
 

 

Insulation shall be provided to conserve heat energy, provide personnel protection from hot surfaces and prevent nuisance water condensation on cold surfaces. 

 

All hot parts shall be covered with mineral wool, fiberglass or calcium silicate of a suitable thickness. To avoid deformation, calcium silicate shall be used where the piping would be readily walked on. Flat surfaces, cylindrical surfaces and irregular surfaces located outside shall be lagged with aluminum, properly sealed. Flat or cylindrical services located inside shall be lagged with aluminum or canvas with aluminum paint. 

 

Irregular surfaces located inside shall be enclosed with preformed aluminum jackets or covered with canvas and finished with aluminum paint. Equipment requiring frequent access for maintenance shall be provided with easily removable and reusable insulation and lagging systems. 

 

Surface temperature of any lagging or insulation shall not exceed 140°F. 

 

Page  33 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

For heat conservation insulation, the materials used shall be either preformed fiberglass, mineral wool or calcium silicate with an 0.25 inch thick desert tan colored aluminum jacket. For temperatures to 200°F, the minimum insulation thickness is 1.5 inches and above 200°F, 3 inch thickness. 

 

Insulation for personnel protection shall extend from the floor or grating level to an elevation seven feet above this level. The minimum insulation thickness is 1 inch. 

 

All parts where the exposed surfaces temperature will be below the expected dew point temperature and the resulting condensation would be a nuisance, shall be insulated with fiberglass or polyurethane of suitable thickness and covered with vapor barrier jacketing. 

 

Asbestos materials shall not be used. 

 

	
             
 	
            6.5.7
 	
            Painting and Coatings
 

 

Equipment supplied under this contract shall be painted in accordance with Supplier’s standard practice with due consideration for the operating environment. Factory applied painting is required with repair of construction damage immediately following Unit startup.  

 

Epoxy two coat system (one prime and one finish coat) per Company approved paint supplier shall be applied to balance of plant equipment and structures. Surface preparation shall be to near white blast per SSPC. 

 

Page  34 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
            7.0
 	
            ELECTRICAL DESIGN 

 

The electrical 1-line diagram of Exhibit C of the EPC Contract shall be the basis of the electrical system design. 

 

	
             
 	
            7.1
 	
            General Requirements
 

 

Design of the plant electrical systems together with switchgear, circuit breakers, transformers, and motor control centers shall satisfy all needs of the plant and its connection to the transmission line. Generator output shall be as specified in the table below. Electrical power for use in the plant shall be 4160V, 480V, 240, 3 phase and 240/120 Volt single-phase, 60 cycle AC. A fully coordinated protective system shall be included. A solid state uninterruptible power system shall be utilized to supply continued 120V power for critical control equipment. 

 

The turbine-generator shall be capable of operating in isochronous mode. 

 

The plant auxiliary electrical distribution system shall consist of the AC distribution system, the DC distribution system, and lighting and utility power systems. 

 

The required voltages for the plant equipment are: 

	
             
 	
            Generator Voltage
 	
            12.47kV
 
	
             
 	
            Transmission Voltage
 	
            34.5kV
 	
             

 

	
             
 	
            7.2
 	
            Electrical Scope of Work
 

 

	
             
 	
            a. 
 	
            Indoor transmission voltage equipment (except for transformer and interconnect point) sized for the full output of the supplied generator during, and consisting of: 
 

 

	
             
 	
            •
 	
            55°C Rise Main Low Loss Transformer  
 

	
             
 	
            •
 	
            Transmission Voltage SF6 or vacuum insulated breakers  
 

	
             
 	
            •
 	
            One branch line to wellfield before plant metering 
 

	
             
 	
            •
 	
            One in-line breaker to transmission line after plant metering (“transmission line breaker”) 
 

	
             
 	
            •
 	
            One branch line to wellfield after plant metering with space for utility metering on branch line (metering by others). 
 

	
             
 	
            •
 	
            Underground or Overhead feed to transmission Voltage pole disconnect (pole and disconnect by Company) 
 

	
             
 	
            •
 	
            Transformer protective relay  
 

	
             
 	
            •
 	
            High side (revenue quality) metering & instruments (including PF, MVARS, MW) 
 

	
             
 	
            •
 	
            Additional space for utility to add it’s own revenue metering as specified in Section 7.14. 
 

 

	
             
 	
            b.
 	
            Generator System which consists of:
 

 

 

Page  35 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            •
 	
            Turbine - Generators 
 	
             

	
             
 	
            •
 	
            Generator breaker(s) and generator surge protection  
 	
             

	
             
 	
            •
 	
            Power cables
 	
             

	
             
 	
            •
 	
            Turbine - Generator protective relaying and metering  
 
					

	
             
 	
            •
 	
            Automatic synchronization capability across generator breaker, and step-up transformer high-side breaker. 
 

 

	
             
 	
            c. 
 	
            4,160V system which consists of: 
 

	
             
 	
            •
 	
            Station Transformer to 4,160V (10% spare capacity for future growth)  
 
	
             
 	
            •
 	
            4,160V switchgear
 	
             

	
             
 	
            •
 	
            4,160V motor controllers  
 	
             

	
             
 	
            •
 	
            Spare section with cable routing to outside of building
 	
             

	
             
 	
            •
 	
            Section set-up to accept an external diesel generator feed
 	
             

	
             
 	
            •
 	
            5 kV power cables
 	
             

	
             
 	
            •
 	
            Protective relaying and metering
 	
             

									

 

	
             
 	
            d.
 	
            480V system which consists of:
 	
             

	
             
 	
            •
 	
            Station Transformer to 480V (10% spare capacity for future growth)  
 
	
             
 	
            •
 	
            480V switchgear
 	
             

	
             
 	
            •
 	
            480V motor control centers  
 	
             

	
             
 	
            •
 	
            600V power cable
 	
             

	
             
 	
            •
 	
            Protective relaying and metering (volts and amps)
 	
             

	
             
 	
            •
 	
            15% spare cubicles with cable routing to outside of building
 	
             

										

 

	
             
 	
            e.
 	
            125 Vdc system which consists of:
 	
             

	
             
 	
            •
 	
            Station batteries
 	
             

	
             
 	
            •
 	
            Battery rack capacity sufficient for 50% more batteries.
 
	
             
 	
            •
 	
            2-100% battery chargers
 	
             

	
             
 	
            •
 	
            125 Vdc distribution panel
 	
             

								

 

	
             
 	
            f.
 	
            120 Vac system which consists of:
 	
             

	
             
 	
            •
 	
            120 Vac UPS equipment and distribution panel  
 	
             

	
             
 	
            •
 	
            120 Vac distribution transformers and panels
 	
             

	
             
 	
            •
 	
            batteries sufficient to meet the design specification
 
							

 

	
             
 	
            g.
 	
            Freeze protection system
 

 

	
             
 	
            h.
 	
            Lighting system
 

 

	
             
 	
            i.
 	
            Grounding system
 

 

	
             
 	
            j.
 	
            Raceway system
 

 

	
             
 	
            k.
 	
            Lightning system
 

 

	
             
 	
            l.
 	
            Diesel Generator
 

 

 

Page  36 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

7.3          Design Considerations 

 

	
             
 	
            7.3.1
 	
            General
 

 

Insulation levels, short circuit current capabilities, protective relaying schemes and mechanical strength of all equipment shall be selected and coordinated in accordance with good engineering practices. 

 

	
             
 	
            7.3.2
 	
            Protection System
 

 

	
             
 	
            a.
 	
            Protection for the electrical equipment shall be designed with the following objectives: 
 

 

	
             
 	
            •
 	
            prevent and/or minimize damage to equipment 
 

	
             
 	
            • 
 	
            minimize the effect of the disturbance on the uninterrupted portion • of the system 
 

	
             
 	
            •
 	
            prevent injury of personnel in the event of electrical faults or abnormal system conditions 
 

	
             
 	
            •
 	
            minimize the loss in power generation 
 

 

	
             
 	
            b.
 	
            The protective system shall be designed to assure the maximum continuity of service with minimum damage to equipment. Protective devices will constantly monitor the electrical system to detect abnormal conditions and automatically initiate isolation of affected equipment nearest to the fault. Selectivity shall apply to phase to phase, 3 phase, and ground faults. 
 

 

	
             
 	
            7.4
 	
            DC System
 

 

The DC system shall consist of two 125V DC battery banks, two 100% chargers, and a distribution panel to provide power for controls, DC motors, and miscellaneous DC items. 

 

The DC system shall operate at a nominal 125 volts, ungrounded. A standard DC ground detection scheme utilizing a ground detector relay should be used. 

 

The station battery shall have sufficient capacity to supply the demand of the connected loads to permit an orderly and safe shutdown of the generating units. The capacity includes 45 minutes continuous operation for the connected load. 

 

The battery rack shall have capacity for 50% additional batteries to be added in the future. 

 

Recommended engineering practices for ventilation, containment, isolation, and corrosion protection for and from the battery system shall be followed in the design of the system. 

 

Page  37 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

7.5          UPS System 

 

Control system computers, phone, and other critical 120V a/c electronic equipment shall be protected with a commercially available UPS. 

 

	
             
 	
            7.6
 	
            Plant Lighting and Receptacles
 

 

The plant lighting system shall consist of 480 V and 240/120 V, 3 phase-4w loads as needed to supply adequate zone lighting in accordance with recommended IES lighting levels. 

 

Emergency lighting shall be confined to escape-route lighting and essential areas such as control room and switchgear rooms and shall consist of self-contained maintenance free battery packs with at least 90 minute capacity. 

 

High intensity, high efficiency lighting fixtures shall be used in outdoor areas, and will use photo cells with a manual switch in parallel for control. All lighting in finished areas shall have local mounted switches. 

 

Indoor lighting shall be electronic instant-on fluorescents (T-8). 

 

The lighting system shall be designed to give the maintained illumination at operating level not less than shown below: 

 

	
             
 	
            LOCATION
 	
            FOOTCANDLE
 

Indoor Areas: 

 

	
             
 	
            Control Room and Control Areas
 	
            70-80
 

Stock Room, Washroom, Change Room

	
             
 	
            and General Service Areas
 	
            15-20
 
	
             
 	
            Back of Control Panels (Inside Open Door)
 	
            13-15
 
	
             
 	
            Electrical Equipment and Compressor Rooms
 	
            20-30
 
	
             
 	
            Offices and Lab
 	
            80
 	
             

 

Outdoor Areas: 

 

Switchracks, Pump Rows, Valves and 

	
             
 	
            Equipment Areas
 	
            4-6
 	
             

	
             
 	
            Operating Platforms and Process Areas
 	
            4-6
 	
             

	
             
 	
            Loading Areas
 	
            15-20
 
	
             
 	
            Stairways, Walkways
 	
            4-6
 	
             

	
             
 	
            General Areas
 	
            1-2
 	
             

	
             
 	
            Gauge Glasses
 	
            5-7
 	
             

 

Convenience receptacles shall be provided in outdoor areas, spaced at approximately 100 feet apart. Convenience receptacles shall also be provided in finished areas on 8’ spacing. 

 

Page  38 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            7.7
 	
            Studies 

 

 

Complete short circuit, voltage drop (steady state and transient, such as motor starting), grounding system and protective device coordination studies shall be performed for Company review. These studies shall include device coordination time-current curves. In the short-circuit study, short circuit interrupting and momentary duties for a 3-phase bolted fault at the switchgear lineup shall be calculated. Ground fault current and phase to phase studies shall be performed. 

 

	
             
 	
            7.8
 	
            Grounding System
 

 

	
             
 	
            a. 
 	
            A site survey shall be performed to determine the grounding grid design for the station. 
 

	
             
 	
            b. 
 	
            A ground grid shall be provided for the plant and shall be in accordance to latest NEC standards. The plant and substation fences shall be grounded. 
 

 

	
             
 	
            7.9
 	
            Electrical Heat Tracing
 

 

The first line of defense against freeze protection shall be to bury the pipe or equipment as practical. Where that is not possible or practical, electrical heat tracing for freeze protection of all necessary piping, instruments and equipment shall be provided.  

 

The electric heat tracing shall be designed as a system. The system shall be able to handle items that normally will freeze in cold temperatures plus items that will freeze when the plant is shutdown in cold weather. The system shall be complete with thermostatic control, monitoring and power distribution. 

 

The system shall be Raychem, Tyco Thermal Controls, or Company approved equal. Power limiting cables shall be used in geofluid service and working fluid service. Self regulating cables can be used in utility service. 

 

Instruments such as transmitters that are subject to freezing shall be enclosed in a premanufactured traced enclosure. Consideration must be given the electrical area classification that the electrical tracing system is in. 

 

	
             
 	
            7.10
 	
            Cable System
 

 

	
             
 	
            a.
 	
            General
 

 

The cable system shall be divided into three main groups in accordance with their voltage class. 

 

	
             
 	
            b.
 	
            Power Cables
 

 

Low voltage cable-up to 600 volts 

 

Page  39 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

Medium voltage cables-601 volts to 5 kV 

High voltage cables – above 5 kV to 34.5 kV 

 

	
             
 	
            c.
 	
            Cable Specifications
 

 

	
             
 	
            •
 	
            5 kV power cable will be shielded and shall have Ethylene propylene rubber (EPR) insulation and jacket. 5 kV motor feeder cable shall be non-shielded. Type THWN insulation shall be used for all 5 kV power cable. 
 

	
             
 	
            •
 	
            Power and control power cables up to 480 V shall be rated 600 V and have type THWN insulation. 
 

	
             
 	
            •
 	
            Instrument cables shall be rated 300 V, shielded, and shall be 18 guage minimum. 
 

 

Instrument cables shall be used in the low level signal circuits such as transducers, recorders, etc. Multiconductor instrument cables, or pulls of multiple single cables, shall have 20% spares, or two spare pairs, whichever is greater. 

 

	
             
 	
            d.
 	
            Cable Sizing 
 

 

All power cable shall be sized in accordance with the requirement of the National Electrical Code. 

 

	
             
 	
            e
 	
            Cable Installation
 

 

	
             
 	
            •
 	
            Instrument cable shall be separated from power cables whether in conduit or cable tray per IEEE. 
 

	
             
 	
            •
 	
            Direct burial of power cable is permitted per IEEE. Buried power cable must follow pre-defined routes, with shortest distance straight-line runs to individual end points not allowed. An as-built of buried power cable must be provided. 
 

	
             
 	
            •
 	
            Direct burial of instrument cable shall not be allowed. Instrument cable must be in conduit or cable tray. 
 

 

	
             
 	
            7.11
 	
            Motor Specifications
 

 

All motors shall be TEFC, 1.15 service factor and high or super efficiency. Motors greater than 300 HP shall be 4,160V; motors under 300 HP and above 1/2 HP shall be 480V. 

 

	
             
 	
            7.12
 	
            Variable Speed (or Frequency) Drive Specification
 

 

Where required by this Specification Document, or selected by the contractor, VFD’s shall meet the following specifications:

 

	
             
 	
            7.12.1
 	
            Redundancy and Back-up
 

 

 

Page  40 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            •
 	
            each have their own VFD, • or they may be driven by the same VFD, but backed-up by a conventional power supply and a normally bypassed control valve. 
 

 

	
             
 	
            •
 	
            or a spare VFD or the critical components shall be included as warehouse stock.
 

 

	
             
 	
            7.12.2
 	
            Characteristics
 

 

	
             
 	
            •
 	
            Motors supplied with VFD’s shall be inverter duty rated. 
 

 

	
             
 	
            •
 	
            VFD’s shall be per NEMA ICS. 
 

 

	
             
 	
            •
 	
            Drives 60 HP and larger shall use direct torque control technology with no carrier frequency. 
 

 

	
             
 	
            •
 	
            Minimum efficiency shall be 97%. 
 

 

	
             
 	
            7.13
 	
            Diesel Generator System 
 

 

The Diesel Generator (DG) shall supply power for three purposes: 1) when the plant loses power and fails to fall back to house load the DG shall effect an orderly shutdown of the plant, through the supply of plant lighting, HVAC, heat tracing, battery charging, UPS and other critical loads.  

 

	
             
 	
            7.13.1
 	
            Functional Requirements
 

 

	
             
 	
            •
 	
            Diesel or gasoline Generator 
 

	
             
 	
            •
 	
            Rated for 60 days continuous usage at full load. 
 

	
             
 	
            •
 	
            Designed for 20 year life. 
 

	
             
 	
            •
 	
            Fuel storage capacity sufficient for 24 hours at full load for a generator capable of black start, and for 48 hours otherwise, shall be supplied via a combination of one or more of the base of the DG skid and a freeze-protected external fuel tank. Fuel tank(s) shall meet NFPA requirements. 
 

	
             
 	
            •
 	
            The diesel generator shall be supplied with a high-quality commercial exhaust silencer. 
 

 

	
             
 	
            7.14
 	
            Revenue Metering and Utility Communications/Telemetry  
 

 

	
             
 	
            7.14.1
 	
            Metering Requirements 
 

 

Revenue metering facilities shall be provided by the Contractor including a Form 9S meter base suitable to accept a utility provided Landis & Gyr S4 three element meter. The Contractor shall provide necessary wiring to connect to an integral modem within the meter. 

 

The revenue metering instrument transformers to be provided by the Contractor shall be as follows: 

 

	
             
 	
            •
 	
            Current transformers shall be dry type, insulated for the applicable voltage, and have the ratio matching the expected plant output. Current transformers shall have an ANSI metering accuracy of 0.3 
 

 

Page  41 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

B 1.8, and shall have sufficient thermal and mechanical capacity to withstand the maximum momentary current rating of the substation circuit breakers. The secondary terminals shall be screw type with self~ locking screws. Polarity shall be marked with standard markings on all current transformers. Current transformers shall have a 5 amp secondary current. 

 

	
             
 	
            •
 	
            Potential transformers shall have an ANSI metering accuracy class of 0.3 at a W burden, or better, with a ratio matching the expected voltage. The Impulse Insulation Level for the potential transformers shall be equal to or greater than the Impulse Insulation Level of the switchgear. Secondary fuses shall be provided to protect the potential transformers. Potential transformers shall have a 120-volt secondary voltage. 
 

 

Instrument transformer secondary circuits shall be wired out to a 10-pole meter test switch located in an accessible lockable enclosure suitable for the environment. The secondary terminals of the current transformers shall be wired out to the test switch shorting terminal blocks. 

 

All instrument transformer secondary wiring shall be stranded tinned copper conductor, type SIS, cross-linked polyethylene insulation, rated 600 volt, and installed within steel conduit or lockable enclosure. The wire size shall be #10 with 105 stands per conductor. Splicing and tapping of wiring shall not be permitted. All wiring shall be fitted with solderless, non-insulated, ring-type compression terminal connectors. All wire terminals shall be attached using a positive ratchet locking crimping tool. More than two terminations per pole of terminal blocks and devices will not be permitted. 

 

If metalclad switchgear is utilized, the minimum acceptable accuracy class for metering instrument transformers shall be in accordance with the latest edition of ANSI Standard C37.20.2. The revenue metering equipment shall be installed in a lockable dedicated utility metering cubicle within the switchgear. 

 

	
             
 	
            7.14.2
 	
            Communications/Telemetry Requirements 
 

 

The Contractor’s equipment shall provide generation output data using DNP3 Level 2 Slave communications protocol via modem, and Company provided dedicated 4-wire analog communications circuit. 

 

The telemetering facilities shall be connected to the same bus as the Idaho Power Company revenue metering equipment. 

 

Page  42 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

8.0          INSTRUMENTATION AND CONTROLS DESIGN  

 

	
             
 	
            8.1
 	
            General Requirements 
 

 

Monitor/control of plant equipment will be accomplished from a central control room. To provide a reliable and integrated operator interface, a distributed control system (PLC) will be utilized. The PLC shall be designed to serve as the primary monitoring/control system of the plant. 

 

The PLC system shall be capable of true plant wide automation. The architecture of the system must accommodate both functional and geographical distribution of the hardware throughout the site while allowing system wide access to the distributed data. The system architecture shall support a Windows XP Window client/server environment, or it’s successor, with multiple program partitions. The software shall be object oriented and meet the requirements of IEEE 802.4 as a minimum. The PLC systems shall be manufactured using state of the art microprocessors and peripheral equipment suiting the needs of process control applications. PLC systems shall include only completed, tested and operational programs that are fully documented and described clearly. Installed spare I/O capacity and spare space requirements of 20 % will be met per the specification. Process connected device CPU loading shall not exceed
60% for the monitoring and control of the process under normal and abnormal process conditions.  

 

Subject to compliance with the PLC requirements, the following vendors are acceptable to the Company:  Alan-Bradley, Schneider/Modicon. 

 

	
             
 	
            8.2
 	
            PLC Control System Hardware Design Criteria
 

 

Contractor shall supply written verification from the Supplier that the PLC system will be available for sale for at least another 2 years, and that the Supplier intends to support the product (including spare parts) for at least a minimum of ten (10) years from the time of delivery of the equipment to the job site. 

 

The system shall include all necessary hardware, drawings, schematic diagrams, and test equipment required to execute fault identification. System shall incorporate precious metal plating of component lead wiring, connectors, etc. System construction shall preferably avoid techniques, e.g., wire wrapping, which are particularly prone to damage by corrosive atmospheric pollutants. All systems must provide capability for expansion, which shall be achieved by straight addition, not modification of, hardware, and with minimum of software and configuration changes. All CRT displays shall be color. System shall be able to support, and PLC VENDOR shall be able to supply, and warrant the requested peripheral devices. Systems shall be subject to rigorous quality assurance and testing programs at all stages of manufacture redundant communication data links shall always be provided between devices on the highway.
Both data links shall be continuously monitored and failures alarmed as a system alarm. Changeover from one data link to the other in case of failure of one shall be automatic and shall not interrupt process control. Failure of both data links between controllers and display generators shall not prevent operation of the process controllers. 

 

Page  43 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

Microprocessor based controllers or controller server systems will be of a dual redundant configuration. The system shall have the capability to provide faster scan rates for some selected analog and digital points, a scan rate of 100 milliseconds per point or better shall be possible. 

 

Global access by tag number to each process and calculated variable from any node is essential. 

 

The PLC VENDOR shall provide: Control and I/O Devices, Two Consoles (remote Operator and an Operator/Engineer Workstation with minimum configuration Pentium 4, 3.0 GHz, 512 MB RAM, CDRW Drive, internal 100 GB hard disc drive, 19 inch LCD- monitor, and an external hard drive which mirrors the internal hard drive), system software applicable to all user requirements, Interfaces to other systems, cabinets for PLC Devices, System Cables, Data Highways (internal and external), System and Application Software, and Testing/Training/Documentation for the PLC System. Input/Output (I/O) Modules) like: Analog Input, Analog Output, Digital Input, Digital Output, RTD, Thermocouple, and Periodic Input. The PLC System shall include: Processor Modules, SOE Card (1 ms resolution), Two (2) Laser Jet Printers, Serial Interface Module, Data Highway Interface, and Data Highway. The communication interfaces are required to
contain a high degree of error checking and special note is to be taken of the loading and response times. The PLC communication interfaces shall be replaced on-line without interruption to the system. The interfaces shall be fault tolerant and shall transmit all system diagnostic alarms for display as an integral part of the PLC alarm system. The control system shall have an availability requirement of at least 99.99%. Single point component failure shall not result in loss of availability of the control system. 

 

	
             
 	
            8.3
 	
            PLC System Software 
 

 

The system shall use digital techniques in order to achieve fail-safe control of the process operation. Additionally the design shall provide for logical grouping of process information to allow faster process condition recognition. Operator selection of control parameters and alarm windows shall be by trackball or mouse. Configuration modifications may be carried out on line. The operator displays shall be LCD. System status display selection capability and continuous system alarm monitoring shall be provided on the operator console. The system shall be simple and flexible with regard to re-configuration of loop connection and display formats to suit changes in operational requirements. The system must have the capability to be totally reconfigured on-site with the hardware and software system supplied. Dynamic data display on CRT shall have an update time of 1 second or less. Controller’s response
(time interval between input change and new output) shall be within 1 second. Commands from the console to activate field devices shall be accomplished with 0.5 second. Alarm inputs shall be displayed within 1 second. Graphics call up time shall be 1 second or less. System shall include audio annunciation, display, and logging facilities for alarms. “First Out” capability shall be provided on all alarm/shutdown functions. System status display selection capability and continuous system alarm monitoring shall be provided on the operator console. 

 

Page  44 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

 Contractor shall supply integrated programming and control via the PLC for Company-supplied equipment located outside of the power plant Facility, based on Company-input logic definition with guidance from Contractor. 

 

The PLC shall require minimum maintenance and routine calibration, and shall have comprehensive self-checking calibration and self-diagnostic fault capabilities including self-test failure alarms. Comprehensive system status information shall be available for display on standard operator consoles. 

 

	
             
 	
            8.3.1
 	
            PLC Documentation
 

 

Contractor shall supply Company with full documentation of PLC programming, including subroutines and control algorithms. 

 

	
             
 	
            8.4
 	
            Cabinets, Power Supplies and Wiring
 

 

PLC Cabinet doors and panels shall be fitted with dust tight seals and shall conform to IP-51 Standards, or better, unless PLC manufacturer environmental requirements are met through the use of IP-41 Standards cabinets. All equipment cabinets, processors, CRT console peripheral items, or PLC devices utilizing 240/120 VAC power must be properly fused. Separate earthing shall be provided i.e., electrical safety ground for the PLC cabinets and metal work, and signal ground for field instruments. Instrument shields shall be earth grounded at the marshalling cabinet. 24VDC power supply with battery backup is acceptable. 

 

	
             
 	
            8.5
 	
            Control Valve Specification
 

 

	
             
 	
            •
 	
            Shall be flanged or wafer type construction. 
 

	
             
 	
            •
 	
            Valve material shall be carbon steel body with stainless steel or stellite trim, unless the service environment requires otherwise. Stellite trim shall be used for valves in geofluid service. 
 

	
             
 	
            •
 	
            Stainless steel valves shall be used in stainless steel piping.  
 

	
             
 	
            •
 	
            Pneumatically operated valves shall be supplied with I/P converters and positioners. Position transmitters are required on any valves in critical valve service. 
 

	
             
 	
            •
 	
            Valves that are required to be corrosion resistant shall be 316 SS.  
 

	
             
 	
            •
 	
            Valves with motor operators shall have current to position converters.  
 

	
             
 	
            •
 	
            Process control valves (e.g. downstream of the feed pump) shall be provided with isolating block valves that will permit the valve to be removed for service without draining the entire working fluid system. The control valve may be included inside the pump isolation valves. Handwheels and bypass valves are not required.  
 

	
             
 	
            •
 	
            Control valves in brine service shall be capable of being isolated within the power plant boundary through a combination of plant inlet and outlet valves (included in Company Scope), or pump valves, or dedicated valves. The valve must be capable of being removed and serviced without the need to drain the entire cross-country pipeline system. Because of the clean nature of the Raft River geo fluid, common geothermal bypass and isolation standards 
 

 

 

Page  45 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

are not required. A handwheel for manual control is required. The actuator shall be sized to at least 25% larger than the maximum process requirement dP, or the shaft limit, whichever is less. 

	
             
 	
            •
 	
            All instrument tubing shall be 316 SS, or may be plastic if rated for 10 years outdoor service in the ambient temperature conditions as specified in Section 3. 
 

	
             
 	
            •
 	
            Control valves are to be designed for fail-safe position  
 

	
             
 	
            •
 	
            Control valves shall meet applicable noise requirements. 
 

	
             
 	
            •
 	
            Control valves in brine service or other scaling service shall only be quarter-turn eccentric cam type, such as Masoneillan Camflex II or Fisher V-500. No rising stem or sliding seat valves shall be used. 
 

 

	
             
 	
            8.6
 	
            General Instrument Specification 
 

 

	
             
 	
            •
 	
            Pressure gauge – shall have a phenolic case, 4 to 6 inch dial, 316 SS bourbon tube and socket, and 1 inch rear blowout disc. 
 

	
             
 	
            •
 	
            Thermocouples – shall be ISA type K, 1/4 inch nominal outside diameter with stainless steel sheath and elements of the spring load design. All thermocouples shall be duplex type.  
 

	
             
 	
            •
 	
            Thermowells - Thermowells in geofluid service shall be 316 SS made from one solid block. Process thermowells may be threaded or flanged. 
 

	
             
 	
            •
 	
            Bimetallic Thermometers – shall have 5 inch disk with adjustable angle faces and 316 SS thermowells. 
 

	
             
 	
            •
 	
            RTD’s – shall be three wire 100 ohm and shall be provided complete with thermowell as an assembly, where a thermowell is required. 
 

	
             
 	
            •
 	
            Pressure switches – shall be of the DPDT type and all wetted parts be 316 SS. 
 

	
             
 	
            •
 	
            Level Switches – shall be of the float or displacer type and be of the DPDT type. 
 

	
             
 	
            •
 	
            Gauge Glasses – shall have block valves with integral ball check valves and be of the armored type. 
 

	
             
 	
            •
 	
            Flow Elements – Flow tubes shall normally be carbon steel body with stainless steel throat. Orifice flanges shall be provided with flange taps and jack bolts. Orifice plates shall be the paddle type made of 316 SS. 
 

	
             
 	
            •
 	
            Safety and Relief Valves – shall be in accordance with ASME requirements. Discharge piping shall be routed to reduce hazard to personnel. Thermal relief valves shall be 3/4” NPT minimum. All other relief valves shall be flanged, full nozzle type. Materials will be carbon steel bodies with stainless steel trim. Rupture discs shall be installed under relief valves in brine service. 
 

	
             
 	
            •
 	
            Transmitters – shall be smart, 4-20 maDC for control signals, be of the two wire type, with wetted parts constructed of 316 SS, and be enclosed in a NEMA 4 housing with integral junction box and wiring terminals. 
 

	
             
 	
            •
 	
            Alarms and Trips – Equipment shall be provided with accurate alarm and trip devices with ample safety margins to protect all equipment. Trip contacts shall be primary element switches. 
 

	
             
 	
            •
 	
            Lower Explosion Limit (LEL) and other hazardous material monitoring/alarm systems shall have monitors/transmitters mounted at appropriate places through out the plant. Monitoring/alarm panels shall be mounted in the 
 

 

 

Page  46 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

control room.  

 

	
            9.0
 	
            CIVIL, STRUCTURAL, AND ARCHITECTURAL DESIGN  
 

 

	
             
 	
            9.1
 	
            Geotechnical Report (by Company)
 

 

A geotechnical soil investigation and analysis, including soil resistivety, shall be conducted to establish foundation design parameters, leach field and grounding requirements. Detailed civil/structural design criteria shall be included in the geotechnical report. 

 

	
             
 	
            9.2
 	
            Civil Work Criteria  
 

 

	
             
 	
            9.2.1
 	
            Earthwork
 

 

Earthwork including excavating, backfill materials and compacting backfill shall be as recommended in the geotechnical report prepared by CH2M Hill, dated October 2005, titled “Geotechnical Report – Raft River Geothermal Project”, and other such geotechnical reports as may be reasonably required by Contractor to design and construct the Facility to the relevant codes and standards, and communicated to Company within three (3) weeks of the signing of the EPC Contract. Unless otherwise specified in the geotechnical report(s), all backfill shall be compacted to 95% dry density with in-place lifts not to exceed 6-inches. If such backfill will not be subjected to external loading, compaction to a  90% dry density is allowable. Contractor has assumed that the native soils can adequately support the anticipated foundation loading. Any soil improvement work that requires more than the standard
soil replacement (2 to 3 ft’ underneath foundation) shall be considered a Change in the Work and subject to a Change Order. 

 

	
             
 	
            9.2.2
 	
            Traffic and Parking Areas
 

 

All areas within the Facility subject to normal car, truck, or crane traffic, including a parking area sized for a minimum of six vehicles shall be constructed with a 6” thickness of a modified “Pit Run Sub-base” comprising generally an aggregate composition of a) 3 – 12% No. 200, b) 5 – 20% No. 100, c) 30 – 60% No. 4, d) 60 – 100% 2-inch, e) 0% larger than 2-inch. The aggregate shall be compacted to 95% dry density in accordance with AASHTO T99. Other design requirements include: 

 

	
             
 	
            •
 	
            Plant road width:  20 feet minimum 
 
	
             
 	
            •
 	
            Minimum turning radius:   20 feet
 
	
             
 	
            •
 	
            Design speed 10 mph
 
						

 

Culverts and pipes shall be designed in accordance with AASHTO-HS20-44 loading criteria, except for areas subject to special heavy transporting 

 

Page  47 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

equipment, which shall be designed for an axle load given by the supplier. 

 

Guard posts (6” diameter concrete filled) will be placed where required to protect structures and equipment against possible damage from vehicles. 

 

	
             
 	
            9.2.3
 	
            Storm Drainage 
 

 

Runoff, resulting from rainfall, shall be conveyed to drainage ditches by sloping the tributary surface area. Surface slopes of 1.0 percent are preferred. Flatter slopes may be used if necessary. 

 

Design rainfall shall be 1 inch per hour intensity and 2.6 inches in 24 hours. Calculations shall be performed to verify adequacy of drainage system design. 

 

Design velocity for earth drainage ditches shall be appropriate to avoid erosion of the bottom slope of ditches. 

 

Design frequency for the power plant site shall be based on a 100 year storm with a minimum time of concentration Tc = 5 minutes. Other areas shall be designed for 100 years frequency with Tc = 10 minutes. 

 

Storm drainage from within the power block, building, and switchyard area shall drain to an on-site unlined pond, the locations of which shall be as agreed to between the Company and Contractor t. Other areas of the fenced area are not required to drain to the unlined pond. 

 

	
             
 	
            9.2.4
 	
            Oil, Chemical, and Fuel Spill Containment
 

 

The design shall follow specific Company permit requirements. Generally the spill containment system shall be designed to curb areas where oil and fuel are present. The curbs or walls shall be able to contain 110% of the volume of the oil or fuel plus margin for rain or firewater. Each curbed or wall area shall contain a 2 foot x 2 foot x 2 foot sump for pumping. The sumps shall be covered with grating and shall have a 2 inch outlet valve if the sump can be drained by gravity. Walls shall have stiles for access. The top of curbs shall be one inch above grade in order to prevent tripping. 

 

	
             
 	
            9.2.5
 	
            Heat Exchanger Cleaning Solids Containment
 

 

The heat exchangers shall be provided with a solids containment area for hydroblast cleaning of the brine-containing heat exchanger tubes. A pad with a curb 1” above grade and a depth of 4” to 6” shall be provided to catch the solids from the hydroblasting cleaning operations, including reasonable expected overspray. Each curbed area shall contain a 3 foot x 3 foot x 3 foot sump for pumping. The sumps shall be covered with 

 

Page  48 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

grating and shall have a 2 inch outlet valve if the sump can be drained by gravity. 

 

	
             
 	
            9.2.6
 	
            Underground Utilities Protection 
 

 

Installation of underground utilities shall be at least two feet below finish grading or as specified in the geotechnical report. Underground electrical runs shall be marked with red concrete or direct buried cable will be flagged. 

 

Pipes will be checked for traffic loads using the Marston Formula and with reference to AASHTO “Standard Specifications for Highway Bridges”. 

 

	
             
 	
            9.2.7
 	
            Cooling Tower Basin Design The cooling tower basin shall 
 

 

	
             
 	
            •
 	
            generally be in accordance with the cooling tower manufacturer recommendations and the Contractor’s most recent cooling tower design of similar duty built in the Imperial Valley within the three years previous to this EPC Contract. 
 

	
             
 	
            •
 	
            extend sufficiently beyond the sides of the cooling tower structure where falling water is present such that water is not blown out of the basin during normal site wind conditions.  
 

	
             
 	
            •
 	
            provide sufficient depth for a reasonable accumulation of mud in the basin and the ability to fluctuate the basin water level by a reasonable amount for normal operations. 
 

	
             
 	
            •
 	
            The top of the cooling tower basin wall shall be twelve to eighteen inches, minimum, above finished grade to inhibit debris from entering the basin. 
 

	
             
 	
            •
 	
            Be designed to prevent infiltration of water to the ground. 
 

	
             
 	
            •
 	
            Allow for expansion of another cooling tower cell in the future. 
 

	
             
 	
            •
 	
            The cooling tower basin slab shall be sloped to facilitate periodic removal of sediment by spraying with water to wash the sediment to a collection point in the pump pit. 
 

 

	
             
 	
            9.2.8
 	
            Cooling Tower Pump Pit Design 
 

 

The cooling tower pump pit design shall include  

 

	
             
 	
            •
 	
            The transition from the cooling tower basin to the pump pit, and the pump pit itself, shall be designed to the cooling tower pump manufacturer’s requirements in respect to turbulence at the cooling tower pump intakes in order to provide maximum pump life. 
 

	
             
 	
            •
 	
            methods to restrict the entrance of mud into the pump pit from the cooling tower basin where it is intended to accumulate. 
 

	
             
 	
            •
 	
            Provisions or space for the installation of removable pump screens by the Company, should such screens be deemed to be required either during the course of the EPC contract and subject 
 

 

 

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to a Change Order, or at some time in the future.  

 

	
             
 	
            9.2.9
 	
            Cooling tower bulk chemical storage area
 

 

Contractor shall provide an outdoor uncovered chemical storage area that conforms to the following requirements. 

 

	
             
 	
            •
 	
            Contractor will provide a separate concrete below-grade spill containment capacity of 100% of the tank volume for each of three storage tanks comprising 8,000 gallons of 98% sulfuric acid in a 10 foot diameter tank; 8,000 gallons of sodium hypochlorite in a 10 foot diameter tank; and 2,500 gallons of dispersant in a 7 foot diameter tank. 
 

	
             
 	
            •
 	
            The tanks shall be situated and oriented so as not to interfere with the air flow into the cooling tower, per tower manufacturer guidelines for their performance guarantee.  
 

	
             
 	
            •
 	
            The containment area wall shall extend six to twelve inches above grade and shall be no more than 42 inches tall from the slab to the top of the wall. 
 

	
             
 	
            •
 	
            The floor of the sulfuric acid containment area and 6” up the walls shall have an acid-resistant long-life coating to protect the concrete from incidental spills. 
 

	
             
 	
            •
 	
            Each containment area shall have a collection sump per the requirements of Section 9.2.4. 
 

	
             
 	
            •
 	
            The bulk chemical truck unloading area will be paved and drain into the spill containment area. 
 

	
             
 	
            •
 	
            Adjacent to and above each tank containment area, Contractor shall install the chemical feed-pumps on a slab that slopes back to the containment area.  
 

	
             
 	
            •
 	
            A buried 6” PVC Schedule 80 pipe shall be provided from inside the containment area and below each pump to above the cooling tower basin wall. The pipe shall drain into the containment area. Company shall install polyethylene tubing from the pump to the cooling tower basin via the 6” PVC pipe. 
 

	
             
 	
            •
 	
            Mechanical equipment, instrumentation, and electrical requirements are provided in Section 6.3.3.3. 
 

 

	
             
 	
            9.2.10
 	
            Cooling Tower Chemical Treatment Building
 

 

Adjacent to the chemical storage area a chemical treatment building shall be provided per the terms of Section 9.7. 

 

	
             
 	
            9.2.11
 	
            Other Cooling Tower Chemical Treatment Area Requirements
 

 

	
             
 	
            •
 	
            Safety shower and eye wash per Section 6.5.5.
 	
             

	
             
 	
            •
 	
            Service water for chemical washdown
 	
             

	
             
 	
            •
 	
            Instrumentation tie-in to PLC for tanks and for pump control.
 
					

 

 

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            9.3
 	
            Grouting of Rotating Equipment 
  

 

Rotating equipment of 25 HP or greater shall be grouted with epoxy grout that is approved by the Company. The epoxy grout shall be installed by a contractor that is certified by the grout vendor, and has substantial experience in epoxy grouting, to perform the installation. All rotating equipment grouting will be witnessed by the Company’s Representative. A 48 hours advanced notification will be given. Grouting or drypacking of rotating equipment under 25 HP shall be done with Five Star Grout or Company approved equal. 

 

	
             
 	
            9.4
 	
            Design Loads 
 

 

The following design loads shall be used: 

 

	
             
 	
            9.4.1
 	
            Dead Loads (D)
 

 

	
             
 	
            a.
 	
            Dead loads include the weight of framing, roofs, floors, walls, partitions, platforms and all permanent equipment and materials. The vertical and lateral pressures of liquids shall also be treated as dead loads. 
 

 

	
             
 	
            b.
 	
            Floors shall be checked for the actual equipment loads. For permanently attached small equipment, piping, conduits, and cable trays, a minimum of 20 psf shall be added to floors and roofs. 
 

 

	
             
 	
            c.
 	
            Where the piping is to be supported from platforms or walkway beams, actual loads shall be determined and used. 
 

 

	
             
 	
            9.4.2
 	
            Live Loads (L and LO)
 

 

	
             
 	
            a.
 	
            Live Loads (L) 
 

 

Live loads include floor area loads, snow loads, laydown loads, equipment handling loads, lateral earth pressure and vehicles. The floor area live load shall be omitted from areas occupied by equipment whose weight is specifically included in dead load. Live load shall not be omitted under equipment where access is provided, for instance, an elevated tank on four legs. 

 

	
             
 	
            b.
 	
            Live Loads During Operation (LO) 
 

 

In loading combinations including earthquake motions, the live loads shall be limited to the designation “LO”, which is defined as the live load expected to be present when the plant is operating. The “LO” loads shall be established in accordance with the layout and mechanical requirements, shall be applied simultaneously with the 

 

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seismic forces, and shall be shown in the calculations. These loads may vary depending on the function of a specific area. Because of the overall light occupancy of power plants, when investigating the overall behavior of the structure or large portion thereof, the occupancy loads need not be considered. 

 

In the laydown areas, the actual weight of the equipment as spread out on the floor shall be considered “LO’. 

 

Crane loads shall be considered live loads. 

 

	
             
 	
            c.
 	
            Minimum Design Live Loads
 

 

The following minimum live loads shall be used in the design. Certain other applicable loads are listed separately in succeeding sections. 

 

General 

	
             
 	
            Roofs
 	
            20 psf
 	
             

	
             
 	
            Offices
 	
            50 psf
 	
             

	
             
 	
            Stairs and Walkways
 	
            100 psf
 

	
             
 	
            Railing: 
 	
            25 plf or 200 lbs applied in any  direction at top of railing 
 

	
             
 	
            Platforms and Gratings
 	
            100 psf
 	
             

	
             
 	
            Surcharge adjacent to plant structures
 	
            200 psf
 	
             

	
             
 	
            Truck support structures
 	
            AASHTO HS20-44
 
	
             
 	
            Snow Load
 	
            29 psf per IBC
 	
             

					

 

Special Areas, 

	
             
 	
            Cooling Tower Deck
 	
            75 psf
 	
             

	
             
 	
            Turbine lay-down area
 	
            100 psf
 
	
             
 	
            Control Room
 	
            50 psf
 	
             

	
             
 	
            Switchgear Floor 
 	
            250 psf or equipment weight, if greater
 

	
             
 	
            Battery Room
 	
            250 psf
 
	
             
 	
            Raceways
 	
            15 psf
 	
             

	
             
 	
            Pipeways  
 	
            *
 	
             

					

 

Actual load but not less than 35 psf on each level. 

 

	
             
 	
            d.
 	
            Live Load Reduction
 

 

No reduction shall be allowed for warehouse storage areas. 

No reduction shall be allowed for slabs, beams, joists and girders, for loads exceeding 100 psf. 

 

 

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e.             Machinery Foundation Design 

 

Bearing capacities and other relevant data are provided per Section 9.1 and Section 9.2.1. Designs shall account for dynamic loads which may occur during normal and upset conditions. 

 

	
             
 	
            9.4.3
 	
            Earth Pressure
 

 

Earth pressures shall be in accordance with the recommendations from the geotechnical report(s). In no case shall the loads be less than the requirements of the IBC.  

 

	
             
 	
            9.4.4
 	
            Groundwater Pressure
 

 

For structural and buoyancy calculations, the high groundwater table shall be provided in the geotechnical report(s). The effect of a design flood shall also be considered. 

 

	
             
 	
            9.4.5
 	
            Wind Loads (W)
 

 

All structures shall be designed for wind loading in accordance with ASCE 7.02 based on 90 mph wind (per IBC) exposure C, importance factor 1.0, or the IBC whichever results in higher loadings. 

 

	
             
 	
            9.4.6
 	
            Seismic Loads (E)
 

 

All structures shall be designed in accordance with the IBC, Zone C. 

 

	
             
 	
            9.4.7
 	
            Special Considerations and Temporary Loads
 

 

	
             
 	
            a.
 	
            Design restrictions on shoring removal that are different from the normal practice recommended by ACI codes shall be shown on the specific design drawings. 
 

	
             
 	
            b.
 	
            Generally, the structural backfill may be placed when concrete reaches 60 percent of f’c. Structures designed primarily for earth retention shall not be backfilled for 28 days. Other backfill restrictions, if any, shall be shown on the specific design drawing. 
 

	
             
 	
            c. 
 	
            The design load on structures subject to impact loading shall be increased by 25 percent unless otherwise specified. 
 

 

	
             
 	
            9.4.8
 	
            Deflections and Settlements
 

 

	
             
 	
            a. 
 	
            Deflection of structures and structural members shall conform to the requirements of the IBC and other referenced codes. 
 

 

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            b. 
 	
            Differential settlement shall be limited based on criteria given in the Geotechnical Report. 
 

 

	
             
 	
            9.4.9
 	
            Thermal Loads
 

 

	
             
 	
            a.
 	
            All vessels and exchangers shall be investigated for thermal expansion. 
 

	
             
 	
            b.
 	
            Other thermal loads caused by expansion or contraction due to a change in temperature from the erection condition shall receive proper consideration. Such loads shall include 1) forces caused by partial or complete anchorage of piping or equipment, 2) forces caused by sliding or rolling friction of equipment, 3) forces caused by expansion or contraction of the structure. 
 

	
             
 	
            c.
 	
            Initial temperature for calculating expansion or contraction in structural design = 70°F. 
 

 

	
             
 	
            9.5
	
            Structural Design  
 

 

	
             
 	
            9.5.1
 	
            General
 

 

All steel structures shall be designed in accordance with the AISC 9th Edition and IBC, unless more recent editions have been released. Soil bearing pressure shall be checked for the actual loads. Reinforced concrete shall be designed, using the ultimate strength method. 

 

	
             
 	
            9.5.2
 	
            Factor of Safety
 

 

A minimum factor of safety shall be provided for all structures as shown below: 

 

	
             
 	
            Overturning:
 	
            1.50
 
	
             
 	
            Sliding:
 	
            1.50
 
	
             
 	
            Buoyancy
 	
            1.25
 

 

	
             
 	
            9.5.3
 	
            Loading Combinations and Allowable Stresses
 

 

	
             
 	
            a. 
 	
            Concrete - The IBC and ACI 318-02 code shall govern for all concrete structures. 
 

 

	
             
 	
            b. 
 	
            Structural Steel - The allowable stress design method will be used. The structural members load resisting capacity, S, is to be based on the allowable stresses. The following load combinations shall apply: 
 

 

	
             
 	
            (1)
 	
            D+L<S
 	
             

	
             
 	
            (2)
 	
            D + LO + E < 1.33 S
 	
             

	
             
 	
            (3)
 	
            D + LO + W < 1.33 S
 
					

 

 

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(4)          .9D + E < 1.33 S  

 

	
             
 	
            c.
 	
            Connections
 

 

All connections shall have a minimum of two 3/4” diameter high strength bolts. All high strength bolt connections shall be bearing type connections with threads including in shear planes. All high strength bolts shall be 3/4” diameter and larger. Bolts 5/8” diameter and smaller shall be machine bolts. 

 

Shop connections may be welded or bolted. Field connections shall preferably be bolted. 

 

	
             
 	
            9.6
 	
            Construction Materials
 

 

	
             
 	
            9.6.1
 	
            Concrete
 

 

	
             
 	
            a.
 	
            Concrete design compressive strengths shall be as follows:  
 

 

	
             
 	
            Use  
 	
            f’c
 

 

	
             
 	
            All structural concrete
 	
            4,000 psi
 
	
             
 	
            Electrical duct encasement and
 	
            2,000 psi
 

lean concrete backfill 

 

	
             
 	
            b.
 	
            Compressive strength (f’c) refers to strength at 28 days.
 

 

	
             
 	
            9.6.2
 	
            Reinforcing Steel
 

 

Bar sizes No. 3 through No. 18 shall be deformed billet steel, conforming to ASTM Designation A615, Grade 60. 

 

Spirals shall be deformed bars conforming to ASTM A82. Welded wire fabric shall conform to ASTM A185. 

 

	
             
 	
            9.6.3
 	
            Anchor Bolts
 

 

Anchor bolt steel, washers, and nuts, shall conform to ASTM A307, A-36 or A-193. Allowable stress on anchor bolts shall be 20,000 psi based on net tensile stress area of bolts. Headed stud anchor bolts shall conform to ASTM A-108. 

 

	
             
 	
            9.6.4
 	
            Structural Steel Structural steel shapes and plates shall conform to ASTM A36 or A572,
 

 

 

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Grade 50. 

 

Structural pipe members shall conform to ASTM A53, Types E or S, Grade B or ASTM A106, Grade A. 

 

Allowable stresses in structural steel shall be determined in accordance with the AISC code, 9th Edition. 

 

All high strength bolts, nuts and washers shall conform to ASTM A325. All other bolts and nuts shall conform to ASTM A307, Grade B. All filler metal shall conform to AWS D1.1. 

 

	
             
 	
            9.6.5
 	
            Concrete Masonry
 

 

Concrete block masonry units shall be Grade ‘A’ conforming to ASTM C90 design compressive strength f m psi shall be as follows: 

 

	
             
 	
            a.
 	
            With special inspection:
 	
            1,350 psi
 

 

	
             
 	
            b.
 	
            Without special inspection:
 	
            675 psi
 

 

	
             
 	
            c.
 	
            Grout:   Minimum compressive strength of 2,000 psi at 28 days.
 

 

	
             
 	
            d.
 	
            Mortar:  Type M, 2,500 psi minimum compressive strength at 28 days.
 

 

Allowable stresses in concrete masonry shall be determined in accordance with the IBC.  

 

	
             
 	
            9.6.6
 	
            Platforms, Walkways and Stairs
 

 

Minimum Widths: Operating & maintenance platforms: 3’-6” 

 

Walkway: 3’-0” 

 

Stairs: 3’-0” 

 

Grating for platforms and walkways shall be welded to supports as per typical details unless removeability is required. Removable sections shall be limited to 150 lbs. 

 

	
             
 	
            a.
 	
            Stairs
 

 

Preferred limit for rise/run combination shall be: rise 6-1/2”, run 11” to rise 7-1/2” run 10”. Rise height and run width shall be uniform throughout any flight of stair including any foundation structure used as one or more runs of the stairs.  

 

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Maximum vertical distance between landing: 

 

12’ when stair is required for general use. 

18’ when stair is only used to attend the equipment. 

 

Each minimum landing width shall be 3’-0”. Stair tread shall have a visible abrasive nosing. 

 

	
             
 	
            b.
 	
            Ladders
 

 

Step-off platforms shall be provided at 30’ maximum intervals. 

 

When ladder height exceeds 20’ above grade, a cage shall be provided. Self-locking gates shall be as required by OSHA. 

 

Ladders with a 5 degree of repose shall be installed instead of vertical ladders when there is regular operation traffic or where maintenance access is often required. 

 

	
             
 	
            c.
 	
            Handrails and toe boards
 

 

As required by OSHA. 

 

	
             
 	
            9.7
 	
            Buildings
 

 

	
             
 	
            9.7.1
 	
            Prefabricated or on site erected Electrical Building
 

 

The Electrical Building is a stand-alone building. All exterior walls and roof will be insulated. Exterior doors are to be insulated. This building will be air conditioned and heated if required per minimum inside temperature specifications. 

 

The following equipment, as a minimum, shall be located in the Electrical Equipment Building: 

 

Switchgear 

Motor Control Center 

Uninterruptible Power Supply 

Protective Relay Board 

Battery Charger and DC Batteries 

 

	
             
 	
            9.7.2
 	
            Fire Water Pump and  Mechanical Equipment Houses 
 

 

The Fire Water Pump House shall be an industrial grade permanent metal building with concrete slab on grade. All exterior walls and roofs are to be insulated. This building will be heated and ventilated, as required. 

 

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The following equipment, as a minimum, shall be located in the mechanical equipment building: 

 

	
             
 	
            •
 	
            Diesel Generator (DG)  (or gasoline generator)
 
	
             
 	
            •
 	
            Air compressors
 	
             

 

	
             
 	
            9.7.3
 	
            Control Building
 

 

A pre-engineered metal building will be utilized. This building may be combined with the electrical building. All exterior walls shall be insulated to a minimum of R-19. The roof will be insulated to a minimum of R-30. The building will be heated and air conditioned. 

 

All windows and doors, interior and exterior, shall be metal framed. Exterior doors will be metal, insulated, and shall have reinforced half lights and will be keyed alike with knob locks and deadbolts. Outside doors shall not open directly into the control room. All windows shall be double paned with solar reflector glass. The exterior sheeting shall be 24 gauge with a color to be determined by the Company. The building interior shall be finished with a color to be determined by the Company. Floors will be linoleum tiled with a color to be determined by the Company. The ceiling will be hung with acoustic absorbing tile. Florescent lights will be hung in the ceiling. Low glare diffusers shall be used in the control room. Hot water (non potable) may be via an Instaheat under sink device. Electrical, data and phone outlets shall be provided in the control room and office. 

 

The control room will contain: 

	
             
 	
            •
 	
            Self-closing door with a half light. 
 

	
             
 	
            •
 	
            PLC Operator Interface and integral desk with power, data, and phone outlets 
 

	
             
 	
            •
 	
            Fire alarm panel, turbine panel, gas monitoring panels. 
 

	
             
 	
            •
 	
            PLC instrument I/O interface cabinets 
 

	
             
 	
            • 
 	
            other operator and plant control devices (if any)
 

	
             
 	
            •
 	
            Allocation of space for: 
 

	
             
 	
            o
 	
            Two 6’ x 4’ bookshelves for plant operation manuals and project manuals. 
 

	
             
 	
            o
 	
            filing cabinet 
 

	
             
 	
            o
 	
            Two workstation desks for visitors, with phone, data, and power outlets. 
 

 

One unisex ADA (American’s with Disabilities Act)-compliant restroom will contain: 

 

	
             
 	
            •
 	
            A toilet, sink, mirror, soap and towel dispenser.
 
	
             
 	
            •
 	
            mop and broom closet
 	
             

	
             
 	
            •
 	
            mop faucet
 	
             

					

 

Communication closet containing: 

 

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            •
 	
            Space for telephone switching equipment 
 

	
             
 	
            •
 	
            Space for Intranet and Internet communication equipment 
 

	
             
 	
            •
 	
            Dead-end runs for all voice and phone communications 
 

	
             
 	
            •
 	
            Multiple outlets for communication devices 
 

	
             
 	
            •
 	
            Two dedicated 120V electrical circuits for the convenience outlets 
 

 

The building shall also contain: 

 

	
             
 	
            •
 	
            6’ x 8’ storage room with locking door.
 

 

	
             
 	
            9.7.3
 	
            Cooling Water chemical treatment building 
 

 

Located adjacent to the Chemical storage area described in Section 9.2, Contractor shall provide a lit and lightly insulated storage building for miscellaneous cooling water treatment chemicals. Building shall be designed to accomplish the following objectives 

 

	
             
 	
            •
 	
            Located at sufficient distance from cooling tower so as to not interfere with air flow to cooling tower per cooling tower manufacturer requirements for their performance guarantee. 
 

	
             
 	
            •
 	
            Contain a buried 6” Schedule 80 PVC pipe from the building to above the cooling tower basin wall through which Company will install tubing to deliver chemicals to the cooling tower 
 

	
             
 	
            •
 	
            Be of sufficient size to store 6 barrels of chemicals and one 275 gallon tote container. 
 

	
             
 	
            •
 	
            Contain a man-door and a rolling door through which to bring in chemical on a fork lift or a dolly. 
 

	
             
 	
            •
 	
            The floor shall be sloped away from the rolling door so that any spill or washdown will drain to the 2500 gallon storage tank containment area (See Section 9.2) through a high capacity floor drain. 
 

	
             
 	
            •
 	
            The walls that do not contain the rolling door shall be curbed to prevent corrosion of the building from spilled chemicals. 
 

	
             
 	
            •
 	
            The building shall be provided with power outlets sufficient to run chemical pumps and heat tracing to be provided by Company, if required. 
 

 

	
             
 	
            9.8
 	
            Site Requirements
 

 

	
             
 	
            9.8.1
 	
            Site Perimeter Fence
 

 

The plant shall be enclosed by a grounded industrial quality 7-feet high galvanized chain link fence with three strands of barbed wire, supported by angle brackets, facing out. A gate will be provided at the plant entrance. All gates shall be built over a concrete apron that extends 3’ forward and back from the gate and 2’ beyond the width of the opening on each side.  

 

The electrical substation will also be fenced and contained a pedestrian and vehicular access gate.  

	
             
 	
            9.8.2
 	
             

 
 

 

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Site Preparation 

 

The site will be cleared and grubbed as necessary for the facilities, operations and construction as specified herein. Areas not required for plant operation shall remain natural. Erosion control for storm drainage during the construction phase shall be implemented in accordance with the stormwater permit, if needed. An area within the plant site will be graded, if needed by the Contractor to provide for construction trailers and activities. After completion, these areas shall be regraded, and made free and clear of debris and unused construction material. 

 

 

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10.0        SPARE PARTS, SPECIAL TOOLS AND CONSUMABLES  

 

	
             
 	
            10.1
 	
            Spare Parts
 

 

The Contractor’s procurement specifications shall request the equipment suppliers to provide a recommended spare parts list with prices for two years operation.  

 

	
             
 	
            10.2
 	
            Special Tools
 

 

The Contractor’s procurement specifications shall require equipment suppliers to provide any special tools, equipment or lifting devices required to install, test, clean, or maintain the equipment. Special tools for the turbine maintenance shall be supplied by the Contractor. The Contractor will provide all instruments required for the performance testing (if are not part of the permanent Plant instrumentation. Instruments used for  the performance tests shall be of the accuracy as specified in Exhibit D. 

 

	
             
 	
            10.3
 	
            Consumables
 

 

The Contractor shall supply the first fill of all lubricants, oils and motive fluid. 

 

 

 

 

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11.0        SUBMITTALS  

 

	
             
 	
            11.1 
 	
            The Contractor shall submit to the Company and the Company’s Representative information describing the equipment furnished by Contractor in a timely manner, such that the schedule for design and construction of the facility shall not be delayed. The Contractor shall, as a minimum, submit to the Company the following information: 
 

 

The Company shall have the right to review and comment on the following documents in addition to those referenced in other parts of the contract. 

 

	
             
 	
            •
 	
            Project Procedures Manual 
 

	
             
 	
            •
 	
            Contractor Change Order Estimates 
 

	
             
 	
            •
 	
            Contractor Quality Control Procedures 
 

	
             
 	
            •
 	
            Contractor Request for Progress Payments 
 

	
             
 	
            •
 	
            Contractor’s Site Safety and Security Program 
 

	
             
 	
            •
 	
            Performance Test Procedures and Results 
 

	
             
 	
            •
 	
            Operation and Maintenance Manuals 
 

 

	
             
 	
            11.2
 	
            The Company shall be provided with the following according to the following schedule:
 

 

	
             
 	
            •
 	
            Contractor’s Engineering Drawings issued for review. 
 

	
             
 	
            •
 	
            Vendor Submittals including Shop Drawings, Catalog Cuts, Construction Procedures and Scheduling Information 
 

	
             
 	
            •
 	
            Vendor Guarantees 
 

	
             
 	
            •
 	
            Contract Performance Schedule Updates 
 

	
             
 	
            •
 	
            System Test and Start-up Procedures, Test Packages 
 

 

	
             
 	
            11.3 
 	
            The sequence of submission of all submittals shall be such that all information is available for checking each submittal when it is received. Within seven (7) days after receipt, unless as otherwise agreed upon for critical items, the Company will return two copies of the submittals with comments. 
 

 

	
             
 	
            11.4 
 	
            The submittals shall be accompanied by a letter of transmittal identifying the drawings submitted. 
 

 

	
             
 	
            11.5
 	
            Drawings
 

 

	
             
 	
            a.
 	
            General 
 

 

All drawings, data nameplates control programming and Instruction Books shall be in the English language and all dimensions and units of measurements shall be in the United States standard units. 

 

At the conclusion of the work, all drawings shall be submitted as a viewable file in a format such as Adobe Acrobat pdf. Contractor’s CAD drawings shall 

 

 

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be submitted in AutoCAD format.  

 

	
             
 	
            b.
 	
            Drawing Quality
 

 

The submittal shall have every line, character, and letter or symbol clearly legible. All original drawings shall be CAD. All 8-1/2 x 11 drawings shall be on bond paper. 

 

	
             
 	
            c. 
 	
            Scale Required 
 

 

All drawings shall be drawn accurately to a scale sufficiently large to show all pertinent features. Dimensions shown on all drawings shall be in feet and inches. 

 

	
             
 	
            d.
 	
            Type of Prints Required
 

 

Documents shall be submitted in any convenient size as listed below. 

 

“A” size is 8-1/2 in. by 11 in. 

“B” size is 11 in. by 17 in. 

“C” size is 22 in. by 34 in. 

“D” size is 30 in. by 42 in. 

 

	
             
 	
            •
 	
            Final Drawings: All final as built drawings shall be in the following form:
 

 

All final as built drawings submitted to the Company shall consist of (2) two D-sized prints and two CD’s. All 8-1/2” x 11” drawings may be on bond paper. “B” size 11 x 17 and “E” size 34 x 44 shall not be used. All final as built drawings shall be submitted in accordance with the provisions in the EPC contract. 

 

	
             
 	
            •
 	
            Issued for Construction (IFC) Drawings
 

 

IFC Drawings generated by the engineer shall be so marked by the engineer and where required shall be stamped, signed and dated by a professional engineer licensed by the State of Idaho. The signed professional engineer, shall be licensed in the discipline appropriate to the drawing.  

 

All drawings shall be issued to the Company when issued to the constructor.  

 

	
             
 	
            • 
 	
            Issued for Review (IFR) Drawings. 
 

 

Certain key drawings will require review by the Company. The Company requires 3 copies for review.  

 

 

Page  63 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

12.0        TESTING AND ACCEPTANCE  

 

	
             
 	
            12.1 
 	
            General 
 

 

Prior to final acceptance, the power plant shall be inspected and tested for mechanical completion, conformance to the contract, specifications and design documents, performance, and reliability. This testing shall be governed by protocols and procedures agreed to between Contractor and Company.  

 

Performance testing shall be in accordance with Exhibit D. The Contractor shall be responsible for preparing the test procedures and protocols, submitting them for Company’s approval, conducting the tests, and reporting the results.  

 

	
             
 	
            12.2 
 	
            Pre-Operational Testing and Startup 
 

 

This subsection describes and defines general requirements which pertain to the procedures leading to the startup of all equipment provided under these specifications. The Contractor shall be responsible for complete calibration, checkout, testing, and commissioning of all equipment and systems provided by this Contract. All work shall be performed in accordance with the procedures and methods described herein.  

 

	
             
 	
            12.2.1 
 	
            General Scope of Work 
 

 

The Contractor shall provide craft labor, supervision, administration and management, and supply all test and calibration equipment, materials, and services necessary to perform the system calibration, checkout, and initial operation complete in accordance with these specifications for the entire scope of Work provided. This includes training Company’s operating personnel and directing operation of the work as required. The Contractor’s startup manager shall provide overall coordination of the startup program from the completion of construction through initial operation.  

 

Individual systems and items of equipment shall be completed on a turnover package basis in a sequence that will permit systematic checkout and trial operation of each such component before it is incorporated in the initial operation.  

 

The Company will make available its operating personnel during the startup period to work under the Contractor’s technical direction. The Contractor shall provide all other workmen required to make adjustments and correct deficiencies during the equipment and plant checkout and operation.   

 

The Contractor will be responsible for directing the work, from Notice to Proceed through Final Completion, or as otherwise agreed in writing between  

 

Page  64 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

the Contractor and Company, in a safe and efficient manner. The purpose of this section is to establish a systematic approach to construction completion, system demonstration and turnover of plant equipment and systems to the Company.   

 

The Contractor shall submit to the Company a commissioning plan detailing the general procedures for startup and testing, and providing the turnover packages as described below.  

 

	
             
 	
            12.2.2 
 	
            Procedure 
 

 

Compliance Checks  - As facility equipment, systems, and subsystems are sufficiently completed to permit testing, Startup and/or operation, they will be checked for compliance with drawings and specifications. A listing of compliance checks shall be included in the turnover packages. The checks will be performed by the Contractor prior to commencement of the startup activities. The Contractor will be responsible for these compliance checks. Prior to commencement of the compliance check, a documented checking signoff  will be developed by the Contractor for equipment and systems for the purpose of ensuring and documenting that major aspects of the Work have been properly installed and checked. The documentation will include sign-off provisions for the responsible Contractor personnel.  

 

A construction punch list will be prepared for incomplete work and deficiencies. The Company and Contractor will review the system check list and construction punch list, and determine the extent of work required prior to turnover for test and startup. Construction punch list items, which do not preclude safe testing and startup, may be deferred until after startup.  

 

	
             
 	
            12.2.3 
 	
            Turnover Packages 
 

 

Turnover packages will be prepared and delivered to Company for each system or subsystem prior to initial operation to identify system boundaries, testing requirements, and compliance check procedures.  

 

Each turnover package will be assigned a unique number and title and a log will be maintained by the Contractor’s startup manager of all turnover packages indicating status through system completion. The turnover package will include the following:  

 

	
             
 	
            • 
 	
            A letter of transmittal (system release form) identifying the system being turned over. 
 

	
             
 	
            • 
 	
            Open items list which describe the exceptions and uncompleted work items within the boundaries of the system. 
 

	
             
 	
            • 
 	
            List of mechanical equipment, electrical equipment, and instrument index within the system. 
 

	
             
 	
            • 
 	
            If applicable, interim marked-up drawings to reflect system as-built 
 

 

 

Page  65 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

conditions (P&IDs, piping and electrical, electrical single lines and electrical diagrams.) 

 

	
             
 	
            • 
 	
            Flush, leak test hydro records, continuity, and other test records as applicable. 
 

	
             
 	
            • 
 	
            Completed system compliance check records. 
 

 

A startup and system turnover schedule will be prepared by the Contractor and reviewed by Company for the orderly execution of this phase of the Work.  

 

When the Contractor determines that the equipment has been assembled, constructed or completed in accordance with the drawings, and that written operating procedures are available, the Contractor shall notify Company of the achievement of mechanical completion for sign-off and approval by Company. 

 

Upon acceptance of any system or subsystem, the Company shall properly operate and maintain systems or subsystems under the Contractor’s technical direction in accordance with Contractor’s, Subcontractor’s, or Supplier’s instructions and procedures. 

 

Page  66 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

13.0        PLANT OPERATIONS AND MAINTENANCE  

 

	
             
 	
            13.1 
 	
            Anticipated Manpower  
 

 

Based on the plant in the above scope of work, the anticipated manpower to operate the plant is as follows:  

 

Position                                          
                  Number  

	
             
 	
            Plant Manager 
 	
            1 
 
	
             
 	
            Electrical/I&C Technician 
 	
            1 
 
	
             
 	
            Mechanical Maintenance 1 Helper 
 	
            1 
 
	
             
 	
            Shift Operator 
 	
            4 
 	
             

	
             
 	
            Shift Operator Helper 
 	
            4 
 	
             

					

 

	
             
 	
            13.2 
 	
            Operations and Maintenance Manuals 
 

 

Contractor shall provide detailed system and equipment instructions from the turbine generator supplier, the design engineer, condenser/ejector supplier, PLC supplier, and other major equipment suppliers.  

 

The contractor shall supply five (5) copies of the instruction books for all equipment incorporated in the work specified herein to the Company. These shall give complete and detailed installation and operation instructions, with particular emphasis on sequence and methods to be used in future maintenance, disassembly, and reassembly. Special precautions, sequence of work, recommendations on methods of assembly, and adjustment of all parts requiring adjustment shall be covered in detail. Parts catalogs and other data shall be included for easy identification of parts for ordering replacements.  

 

The above requirements shall be assembled together with three sets of all major drawings reduced to or copied onto 11 inch by 17 inches paper and bound in a permanent, strong, and serviceable cover without folding the drawings.  

Instruction books as a minimum shall include as required the following:  

 

	
             
 	
            1.
 	
            Recommended methods for assembly and adjustment of all parts requiring assembly or adjustment as part of O&M , including bearings. 
 

 

	
             
 	
            2.
 	
            Overall system diagram, process flow sheets and/or process and instrument drawings. 
 

 

	
             
 	
            3.
 	
            Schematic diagrams showing each discrete component in symbolic form along with its connecting points. 
 

 

	
             
 	
            4.
 	
            Wiring diagrams showing internal and external connections to all components  
 

 

 

Page  67 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

	
             
 	
            5.
 	
            Physical layout drawings identifying each major component. The parts lists shall be keyed to the devices shown on the physical layout drawings. 
 

 

	
             
 	
            6.
 	
            Component parts list identifying each discrete component. The parts list shall be keyed to the devices shown on the physical layout drawings. 
 

 

	
             
 	
            7.
 	
            Detailed operating instructions consistent with the operation and maintenance provisions provided or required by the various equipment suppliers as a condition of their warranty obligations. 
 

 

	
             
 	
            8.
 	
            Recommended maintenance procedures including required test and calibration intervals. 
 

 

	
             
 	
            9.
 	
            Test and calibration procedures for all devices including test equipment connection drawings. 
 

 

	
             
 	
            10.
 	
            Procedures for troubleshooting the equipment and systems. 
 

 

	
             
 	
            11.
 	
            List of recommended spare parts. 
 

 

	
             
 	
            12.
 	
            Manufacturer’s instruction bulletins for all transducers, relays, instruments, etc., supplied by manufacturers outside the vendor’s own company. 
 

 

Page  68 of 68 

	
            Design Criteria - RR EPC Contract, Exhibit C
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY

 

 

[23 pages of diagrams have been omitted and filed separately with the Commission pursuant to a request for confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.]

 

 

 

File: RR-EPC_Exib-D_12-05-05_Rev0

 

EXHIBIT D 

of the 

ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT 

Between US Geothermal, Inc. and Ormat Nevada, Inc., dated December 1, 2005 

PERFORMANCE TEST AND CORRECTION CURVES 

Revision 0 – December 5, 2005 

This Exhibit sets forth the requirements for the conduct of the Performance Tests in accordance with the Engineering, Procure and Construction Contract and the criteria for establishing successful completion of these tests. 

 

	
            1.
 	
            DEFINITIONS
 

 

For the purposes of this Exhibit D capitalized terms when used shall have the meaning defined in the Contract, and as set forth below: 

 

Capacity Test:  The test to be conducted as defined in Section 2.3 below to determine the Net Deliverable Capacity of the Facility. 

 

Correction Curves:  As defined in Section 7 and Schedule B of this Exhibit D. 

 

Design Conditions:  The Geothermal Fluid, ambient air wet bulb temperature and power factor parameters as defined in Exhibit C sections 3.5 of the EPC Contract. 

 

EPC Contract:  Engineering, Procurement and Construction Contract between Company and Contractor, of which this Exhibit D is a part. 

 

Geothermal Fluid or Brine: The geothermal brine to be supplied by Company to the Facility as described in Exhibit C. 

 

Net Deliverable Capacity:  The actual net power generated by the Facility net of all power loads for pumps and other internal uses of the Facility, as demonstrated in the Capacity Test and calculated according to formula 2 of Schedule A of this Exhibit D. 

 

Net Power Correction Factor:  The resultant correction factor of the product of the individual Correction Curves and the uncertainty factor, as defined in formula 1 of Schedule A of this Exhibit D. 

 

Performance Guarantee:  Per the Power Plant Design Criteria of Exhibit C, paragraph 3.5, of the EPC Contract. 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

/

EXECUTION COPY 

 

 

Reliability Test: The test to be conducted as defined in Section 2.4 below. 

 

Synchronization Test: The test as defined in Section 2.1, below 

 

Trip Test: The test as defined in Section 2.2 below. 

 

Turbine Run Back Test: The test as defined in Section 2.5 below. 

 

	
            2.
 	
            PERFORMANCE TESTS
 

 

Additional information and requirements of the Performance Tests are provided in Section 6 or the EPC Contract. 

All tests shall be conditional upon adequate and continuous supply of Geothermal Fluid and availability of electrical grid. If such conditions are inadequate, the tests will be considered according to the EPC Contract. 

 

The Performance Tests will be comprised of the Synchronization Test, the Trip Test, the Reliability Test, the Capacity Test and the Turbine Run Back Test.  

 

The results of the Capacity Test shall be corrected for variations in the conditions as specified in this Exhibit D. 

 

	
             
 	
            2.1
 	
            Synchronization Test
 

 

The Synchronization Test will demonstrate that the plant is capable of automatic synchronization to the power transmission lines, and has reached the point where it is capable of delivering power to the grid. The generator shall be brought to synchronization speed and synchronized to the grid using Contractor’s recommended procedures. The unit shall operate at a positive flow of power from the plant to the grid for one hour, followed by a single trip test from whatever the unit’s one-hour operation has been to confirm that the unit will shut down safely. The results shall be recorded as per the attached “Test Record of the Synchronization Test”. 

 

Critieria for Completion of the Synchronization Test 

 

The Synchronization Test shall be considered successful if the test is conducted without any equipment malfunction and the plant is deemed ready for further testing per this Exhibit D. 

 

If the grid is unavailable for the Synchronization Test through no fault of the Contractor, the test will be deemed complete on the date that the plant is deemed ready to be synchronized, including all purging of pentane lines and other pre-startup activities. 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

2.2          Trip Test 

 

The purpose of the test is to demonstrate that the ORMAT® Energy Converter (OEC) can be operated safely and reliably in the following conditions: 

 

	
             
 	
            a. 
 	
            The OEC shall run at stable condition at 50% (±5%), 75% (±5%), and 100% (±5%) of the Design Conditions power, and at maximum facility output, conditional upon adequate supply of Geothermal Fluid and the electric grid for between fifteen (15) minutes and one (1) hour without any failure or malfunction. 
 

 

	
             
 	
            b. 
 	
            The OEC shall be tripped manually with the OEC remaining in a safe condition without any damage and capable of immediate restart.  
 

 

	
             
 	
            c. 
 	
            After the OEC comes to a standstill and after re-setting the unit, it shall be started again according to the start procedure as described in the O&M Manuals and resume normal operation conditions. 
 

 

The test will be recorded as per the attached “Test Record of the Trip Test”. 

 

Criteria for Completion of the Trip Test 

 

The Trip Test shall be considered successful if the test is conducted without any equipment malfunction or failure, and the turbine/generator does not exceed the manufacturer’s overspeed limit (not to exceed 130% of the synchronized speed of 1800 rpm). 

 

	
             
 	
            2.3
 	
            Capacity Test 
 

 

The Capacity Test shall determine the Net Deliverable Capacity of the Facility. 

 

The Facility shall be tested for a period of twelve (12) hours  (the “test period”). Data shall be recorded once every ten (10) minutes for the test period. The test period shall be used to verify the Facility capacity, during which the Geothermal Fluid conditions, ambient air wet bulb temperature and power factor shall be within the ranges covered by the Correction Curves, but in any case the OEC stipulated nameplate capacity shall not be exceeded.  

 

Out of the test period, one continuous six (6) hour period shall be selected for the Capacity Test. The six hour Capacity Test period shall be selected as the one during the test period that provides the Net Power Correction Factor (CF, as defined in Schedule A of this Exhibit D) that is closest to the value of 1.0 (one point zero) when averaged over the six hour test interval.  

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

The test results will be recorded per the attached “Test Record of Capacity Test”, or similar form as may be agreed by the Contractor and Company at the time of the test. 

 

The Capacity Test results shall be calculated in the following manner: 

 

	
             
 	
            •
 	
            The instrument readings taken during the test period and the approved Correction Curves shall be used to calculate the corrected Net Deliverable Capacity (NDC) of the Facility in accordance with formula 2 of Schedule A to this Exhibit D. 
 

 

	
             
 	
            •
 	
            Contractor shall compare the NDC with the Performance Guarantee. If such comparison shows that the Facility has not achieved the Performance Guarantee, the Capacity Test may be repeated thereafter in accordance with Section 4 of this Exhibit D. 
 

 

Net Deliverable Capacity Deficiency or Surplus 

 

The Net Deliverable Capacity Deficiency (NDCD), if any, shall be used for the purposes of calculating liquidated damages under Section 11.2.1 of the Contract.  

 

The Net Deliverable Capacity Surplus (NDCS), if any, shall be used for the purposes of calculating the performance bonus payment under Section 11.3.2 of the Contract. 

 

The NDCD or the NDCS shall be calculated using formula 3 and 4, respectively, of Schedule A to this Exhibit D. 

 

	
             
 	
            2.4
 	
            Reliability Test 
 

 

The period of the Reliability Test will demonstrate reliable continuous operation of the Facility. 

 

The Reliability Test will be conducted to demonstrate that the Facility can meet 98.5% Availability, over a continuous 168 hour period, conditional upon adequate supply of the Geothermal Fluid and the electrical grid.   

The test results will be recorded per the attached “Test Record of Reliability Test”. 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

Calculation of Availability 

 

Availability will be calculated as follows. 

 

Availability (%) = HG / PH 

where: 

 

	
             
 	
            HG
 	
            =
 	
            Hours of Generation
 
	
             
 	
            =
 	
            (PH – LH)
 	
             

 

During the Reliability Test, the hours of generation shall include brine flow variation from 50% to 110% of design brine flow and manual trips of a production well pump and a pentane feed pump to verify stable operation under ordinary and expected upset conditions. Pump trips shall be undertaken at the discretion of Contractor within the 1st 24 hours of the test. Load change rate will be limited to 2 MW/minute, except after a pump trip. In any case, the minimum Brine flow shall be above 50% of Design Conditions during the test. 

 

	
             
 	
            LH
 	
            =
 	
            Lost Hours of Generation
 

 

In the event that the Facility trips during the Reliability Test, the Lost 

Hours of Generation (in hours) shall be the time that it takes to return to 

the generation level that preceded the trip, or the particular event that 

induced the trip. 

 

	
             
 	
            PH
 	
            =

=
 	
            Period Hours of the Reliability Test Period

168 hours (minimum).   
 

 

Criteria for Completion of the Reliability Test 

 

Upon completion of the minimum 168 hour test period, the Reliability Test will be deemed passed if the calculated Availability is greater than or equal to 98.5%. If the Availability is less than 98.5%, the test may continue on an hour by hour basis until the Reliability Test has been passed, upon agreement of Contractor and Company, which shall not be unreasonably withheld. At any time during the test, Contractor may choose to forfeit the test and restart at a later time. 

 

	
             
 	
            2.5
 	
            Turbine Run Back Test
 

 

The purpose of the test is to demonstrate that the Facility will reliably run back to house power in the following conditions: 

 

	
             
 	
            a. 
 	
            Subject to adequate supply of Geothermal Fluid and the electric grid for one (1) hour without any failure or malfunction, the OEC shall run at stable condition at 100% (±5%), 75%(±5%), and 50% (±5%) of the 
 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

Design Condition Net Deliverable Capacity, and at the maximum available Facility output not to exceed the generator nameplate capacity and not less than the anticipated house load. 

 

	
             
 	
            b 
 	
            The line breaker shall be tripped manually with the Facility remaining in a safe condition without any damage and operating at house power. The frequency of the power produced during the run-back shall not exceed that recommended by the electric and electronic equipment manufacturers of any component in the Facility. 
 

 

The test will be recorded as per the attached “Test Record of the Turbine Runback Test”. 

 

	
            3.
 	
            TEST PROTOCOLS
 

 

The procedures for conducting the tests, including instrument calibration data, instrumentation data, and frequency of measurements will be detailed in individual test protocols. The individual test protocol will be drafted by Contractor and submitted to Company for review and approval at least ninety (90) days prior to the start of any individual test. Within twenty (20) days of receipt of the draft test protocol, Company will provide any comments or suggestions; if none are forthcoming; the test protocol will be deemed accepted. All components of the test protocol, including revisions, will be agreed upon by all parties at least twenty (20) days prior to the commencement of the tests. The test protocol will be consistent with the terms of this Exhibit D. 

 

The test protocols shall explicitly state the industry codes and standards that will be used, the instrumentation required, the form of the expected results, and the anticipated time duration of the test. 

 

	
            4.
 	
            REPEATING TEST
 

 

	
             
 	
            4.1
 	
            Performance Tests – Other than Capacity Test
 

 

The Performance Tests, other than the Capacity Test, may be repeated if the Performance Test criteria are not met, or problems or deficiencies arise during the conduct of the tests which require cessation thereof, or Contractor opts to retest to improve test results. Contractor will establish the actions to be taken to bring about a successful completion of the tests at Contractor’s cost. Contractor shall take such actions and the tests shall be repeated. 

 

Repeating one or more of the tests does not require repeating any of the other tests. 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

4.2          Performance Tests – Capacity Test 

 

The Capacity Test cannot be repeated after a Capacity Test result equals or exceeds the Performance Guarantee. 

 

If the Facility fails to achieve the Performance Guarantee during the initial Capacity Test, Contractor may repeat the test under the following conditions, at Contractor’s cost: 

 

	
             
 	
            a.
 	
            if Company and Contractor agree, such agreement not to be unreasonably withheld, that a test instrument was miscalibrated or the test result was otherwise erroneous. 
 

 

	
             
 	
            b.
 	
            If heat exchangers are inspected and found not to be in “as new” clean conditions 
 

 

	
             
 	
            c.
 	
            After Contractor has taken corrective measures by repairing or replacing and/or re-performing the affected part of the Work necessary to eliminate the Defect(s) or causes that have resulted in the Net Deliverable Capacity being less than the Performance Guarantee. 
 

 

	
             
 	
            d.
 	
            At Contractors discretion, without undertaking corrective measures or showing such miscalibration or error, provided that the Net Power Correction Factor is closer to the value 1.0 (one point zero) than the prior Capacity Test, although the Net Power Correction Factor can be either negative or positive from test to test. 
 

 

Contractor shall be entitled to repeat the Capacity Test, within a period of up to one hundred eighty (180) Days from the Substantial Completion Date or, if Section 6.4 of the EPC Contract applies, from the date that Contractor is able to commence the Capacity Test. 

 

	
            5.
 	
            INSTRUMENTATION
 

 

Contractor will specify a list of key instruments to be used during the Performance Tests in accordance with the test protocol described in Section 3 of this Exhibit D prior to the initiation of the test. The instruments will be calibrated in accordance with the standards of a recognized national organization. 

 

	
             
 	
            5.1
 	
            Instrumentation Accuracy
 

 

Solely for the purposes of these tests, the following instrumentation will be required to have the following minimum after-calibration accuracies. The accuracies shall be updated in accordance with the final installed and calibrated instrumentation: 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

	
            Kilowatt and kilowatt-hour meters
 	
            ± 0.75% (of full scale)
 
	
            Brine flow rate
 	
            ± 1.5% (of full scale)
 
	
            Temperature
 	
            ± 1°F
 	
             

	
            Pressure
 	
            ± 1% (of full scale)
 	
             

	
            Power Factor
 	
            ± 2% (of reading)
 	
             

					

 

	
             
 	
            5.2 
 	
            Measurements of Ambient Wet Bulb Temperature, Geothermal Fluid Conditions and Electrical Power
 

 

As a condition for the conduct of the tests, the Geothermal Fluid conditions, ambient air wet bulb temperature and power factor must be within the ranges covered by the Design Conditions. All conditions shall be measured at the points as defined in the following table: 

 

	
            Measurement 
 	
            Location 
 	
            Responsible Party 
 
	
            Net Power Plant Electrical Production 
 	
            1. High side of the Main Step-up Transformer 2. Electrical feed point of the injection pumps 
 	
            Contractor 
 
	
            OEC Gross Power 
 	
            Generator Management Relay 
 	
            Contractor 
 
	
            Power Factor 
 	
            Generator Management Relay 
 	
            Contractor 
 
	
            Brine Flow Rate 
 	
            Brine supply interface point to the Facility 
 	
            Contractor 
 
	
            Brine Inlet Temperature 
 	
            Brine supply interface point to the Facility 
 	
            Contractor 
 
	
            Pin Brine Inlet Pressure 
 	
            Brine supply interface point to the Facility 
 	
            Contractor 
 
	
            Pout Brine Outlet Pressure 
 	
            Brine discharge interface point from the Facility 
 	
            Contractor 
 
	
            P suction Brine Inlet Pressure to the injection pumps 
 	
            Injection Pumps Suction line 
 	
            Contractor 
 
	
            P discharge Brine Discharge Pressure from the injection pumps 
 	
            Injection Pumps Discharge line 
 	
            Contractor 
 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

6.           CERTIFICATION 

 

	
             
 	
            6.1 
	
            Test Data Certifications 
 

 

Upon successful completion of each performance test performed under this Exhibit D, Contractor and Company shall jointly sign the test data and shall jointly issue a confirmation that the agreed testing protocols specified in this Exhibit D have been followed. 

 

	
             
 	
            6.2
 	
            Performance Test Certifications – Other than Capacity Test
 

 

Upon successful completion of the performance tests performed under this Exhibit D, Contractor and Company shall jointly sign the test reports and shall jointly issue a certificate that testing has been completed and passed the requisite acceptance criteria for the Facility specifying the actual test results and confirming that the agreed testing protocols specified in this Exhibit D have been followed. Non-issuance of the certificate as aforesaid shall be referred to the dispute resolution procedures under Section 14 of the EPC Contract. 

 

	
             
 	
            6.3
 	
            Performance Test Certifications – Capacity Test 
 

 

Contractor shall deliver to Company notice that the Capacity Test has been completed, and the results of the test as soon as possible after the Capacity Test, and in any event prior to testing team and testing equipment leaving the Site. Within ten (10) Days of the Capacity Test, Contractor shall furnish to Company written notification of the results thereof in the form of a final report. The Company shall provide a written statement to the Contractor of the Company’s acceptance of the test, or of any objections to the test results that the Company may have. Such written statement shall be provided within five (5) working days (US basis) of Company’s receipt of the Capacity Test final report. In the event that Company fails to provide to Contractor a written statement within the designated time, the aforementioned results shall be deemed accepted by Company. If Company and Contractor disagree on
the interpretation of the results of the Capacity Test, the dispute shall be referred to dispute resolution in accordance with Section 14 of the EPC Contract. 

 

	
            7.
 	
            CORRECTION CURVES
 

 

Correction curves for changes in the ambient air wet bulb temperature, brine flow rate, brine inlet temperature and power factor from the Design Conditions are provided in Schedule B to this Exhibit D. 

 

In case of deviation of actual conditions from Design Conditions, the Correction Curves will be used to determine the correction factors (F1, F2, ...... etc.) to be applied as defined in Schedule A. 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

The Correction Curves shall be provided in graphical (curve) and equation (curve fit) formats. 

 

	
            8.
 	
            CORRECTION FACTORS
 

 

	
             
 	
            F1
 	
            Ambient air wet bulb temperature net power correction factor as defined by the applicable Correction Curve formula. 
 

 

	
             
 	
            F2
 	
            Brine flow rate net power correction factor as defined by the applicable Correction Curve formula. 
 

 

	
             
 	
            F3
 	
            Brine inlet temperature net power correction factor as defined by the applicable Correction Curve formula.  
 

 

	
             
 	
            F4
 	
            Power Factor correction factor as defined by the applicable Correction Curve formula. 
 

 

	
            9.
 	
            MEASUREMENT UNCERTAINTIES
 

 

For each one of the parameters, the uncertainties of the measurements required to calculate the parameter will be accumulated as per their percentage impact in calculating the total uncertainty of the parameter tested. In case of measurement uncertainties of parameters with correction curves, the percentage uncertainties will be determined by the percentage impact of the uncertainty on the measured parameter according to the correction curve. The resulting accumulated percentage uncertainty is applied to the parameter tested, determining the Measurement Uncertainties of each parameter. 

 

	
             
 	
            Z1
 	
            -
 	
            Uncertainty factor of the electrical meter reading
 

 

	
             
 	
            [ *** ]
 

 

Where: 

 

	
             
 	
            [ *** ]
 

 

	
             
 	
            Z2
 	
            -
 	
            Uncertainty factor of the Facility net power.
 

 

	
             
 	
            [ *** ]
 

Where: 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY 

 

 

 

[ *** ] 

 

 

Note:   The (+) sign in the uncertainty calculation will be used in capacity deficiency (CD) situation, while the (-) sign will be used otherwise. 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY 

 

 

SCHEDULE A: FORMULAS 

 

	
            1.
 	
            CNEP  
 	
            =
 	
            “Corrected Power Plant Net Electrical Production” [MW]
 

 

	
             
 	
            CNEP  
 	
            =
 	
            [ *** ]
 

 

Where: 

 

	
             
 	
            NEP = 
 	
            “Power Plant Net Electrical Production” [MW] [ *** ] 
 

 

[ *** ] as defined in Section [ *** ] of this Exhibit D. 

 

	
             
 	
            CF   
 	
            =
 	
            “Net Power Correction Factor”
 

 

	
             
 	
            CF   
 	
            =
 	
            [ *** ]
 

 

Where [ *** ] are as defined in Section [ *** ] of this Exhibit D. 

 

	
             
 	
            PDP     = 
 	
            Correction of Net Power Plant Output due to deviation from Plant Designed Pressure Drop [MW] 
 

 

	
             
 	
            PDP   
 	
            =
 	
            [ *** ]
 

 

Where [ *** ] are as defined in Section [ *** ] of this Exhibit D and [ *** ] is the ratio between [ *** ] 

 

	
            2.
 	
            NDC
 	
            =
 	
            Facility “Net Deliverable Capacity” [MW]
 

 

	
             
 	
            = 
 	
            [ *** ] 
 

 

	
            3.
 	
            NDCD  
 	
            =  
 	
            Facility “Net Deliverable Capacity Deficiency” [MW]
 

 

if [ *** ] 

NDCD = [ *** ] 

 

if [ *** ] 

NDCD  = [ *** ] 

 

	
            4.
 	
            NDCS   
 	
            =
 	
            Facility “Net Deliverable Capacity Surplus” [MW]
 

 

if [ *** ] 

NDCS = [ *** ] 

 

if [ *** ] 

NDCS = [ *** ] 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY 

 

 

SCHEDULE B 

 

CORRECTION CURVES1 

 

 

	
            F1
 	
            Ambient wet bulb air temperature net power correction factor
 

 

	
            F2
 	
            Brine flow rate net power correction factor
 

 

	
            F3
 	
            Brine inlet temperature net power correction factor
 

 

	
            F4
 	
            Power Factor net power correction factor
 

 

 

 

 

 

_________________________ 

 

1Note:  curves are in a separate file “RR-EPC_Corr-Curves_12-01-05.pdf

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

SCHEDULE C

 

TEST RECORDS

 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

 

EXECUTION COPY 

 

 

RAFT RIVER GEOTHERMAL POWER PLANT #1

 

Wet Bulb Temperature Correction Curve

(Water Cooled Option)

 

[GRAPH[

 

[***]

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY 

 

 

RAFT RIVER GEOTHERMAL POWER PLANT #1

 

Brine Flow Correction Curve

(Water Cooled Option)

 

[GRAPH[

 

[***]

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

EXECUTION COPY 

 

 

RAFT RIVER GEOTHERMAL POWER PLANT #1

 

Brine Inlet Correction Curve

(Water Cooled Option)

 

[GRAPH[

 

[***]

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

 

EXECUTION COPY 

 

 

RAFT RIVER GEOTHERMAL POWER PLANT #1

 

Generator Power Factor Correction Curve

(Water Cooled Option)

 

[GRAPH[

 

[***]

 

 

	
            Performance Test - Raft River EPC Contract, Exhibit D
 	
            Rev 0 – 12/05/05
 

 

*Certain portions of this exhibit
have been omitted and filed separately with the Commission pursuant to a request for
confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of
1934, as amended.  

 

 

 

72

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EXHIBIT E 

WARRANTY CLAIM PROCEDURES 

          1.      Where
Company has agreed in accordance with the terms of the Contract to take
corrective action, and upon notifying Contractor as set forth in Section 10.3.1
of the Contract, Company may undertake corrective action, but Contractor
reserves the right to investigate and determine the eligibility of such warranty
claim. 

          2.      Company
shall notify Contractor in accordance with Section 10.3.1 of the Contract and
provide documents per paragraph 3 below together with a written cost estimate of
the corrective action required. As soon as reasonably possible following the
receipt of said documents and cost estimate, Contractor shall investigate the
defect and shall issue written instructions to Company on the corrective action
to be undertaken, or Contractor shall undertake corrective action by its own
employees or agents. 

          3.      The
following procedures shall be observed in all Contractor warranty claims for the
Facility in connection with which Company taken corrective action at
Contractor’s request as identified in paragraph 1 above: 

                    (a)      A
failure report, which shall contain technical and logistic information
sufficiently detailed to enable Contractor to assess the damage to the Work and
to evaluate appropriate corrective action in the form as agreed to by Company
and Contractor, shall be provided by Company as soon as reasonably practicable
after the occurrence of any event giving rise to a warranty claim. 

                    (b)      Warranty
claims shall be submitted in accordance with paragraph (d) below, and shall
include, as a required minimum, the following documents: 

          (i)      Applicable
failure report; 

          (ii)      List
of equipment and materials purchased or used in accomplishing the repair,
schedule of operations and subcontractors hours applicable to each claim, and a
copy of any internal work orders or purchase orders prepared in connection with
each such claim; 

          (iii)      Company’s
maintenance and repair records with respect to the equipment for which the claim
is being made (Company shall include with such maintenance and repair records
the manufacturer/vendor part number and serial number and the identification by
part number and serial number of the next major assembly call-out (such as, but
not limited to, turbine, generator, electrical cabinet)); and 

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EXECUTION COPY 

          (iv)     
copies of invoices received or prepared for costs and expenses claimed. 

The documentation to be provided pursuant to paragraphs (b)(ii)
and (b)(iii) above, shall be in a form reasonably acceptable to Contractor. 

                    (c)      All
warranty claims pertaining to failure of the equipment for which Company has
independently undertaken corrective action during any calendar month shall be
submitted to Contractor on or before the last day of the following calendar
month. Claims shall be paid by Contractor on a net 30 basis. Work performed by
Company under a warranty claim shall be billed on a “time and material” basis as
defined below: 

                    (d)      “Time
and Material” in connection with a warranty claim is defined as follows: 

          (i)      With
respect to “Time”, the product of one hundred fifteen percent (115%) of the
normal hourly wage (including fringe benefits, insurance and taxes) Company pays
with respect to its particular employee (not including overhead) multiplied by
the number of hours each employee performed the particular Work. 

          (ii)      With
respect to “Material”, one hundred ten percent (110%) of the actual purchase
price paid by Company or an affiliate to a third party for the materials
incorporated or consumed in connection with the Work; and 

          (iii)      With
respect to Work performed by a subcontractor (other than an entity which
directly or indirectly controls, is controlled by, or is under common control
with, Company, Work done by any such entity being deemed Work done by Company
through its own employees for purposes of this definition), one hundred ten
percent (110%) of the actual amount paid by Company to the subcontractor for
such Work. 

                    (e)      Accounting
settlement between Company and Contractor due to warranty claims shall occur on
a quarterly basis. 

                    (f)     
Company shall maintain adequate records to support all warranty claims and allow
Contractor to audit warranty claims upon no less than ten (10) Days period
notice. 

74

EXECUTION COPY 

EXHIBIT F 

APPROVED VENDORS LIST 

  	Equipment Item 	Name of Supplier/Vendor 
	Turbine/OEC 	Ormat Systems 
	Generator   	
      Ideal Electric Co., Kato Engineering, Hundai ; Brush HMA
      

	Feed Pump and Brine 	
      Goulds Pumps, Floway Pumps, FlowServe, Johnston

	Pumps 	
      Pump Company, Ingersoll Dresser; ITT; Bunghartz

	Air Coolers *1 	
      Ormat Systems 

	Tube and shell Heat Exchangers*1 	
      Ormat Systems   

	Cooling Towers 	
      Cooling Tower Depot, Marley 

	Auxiliary Transformers 	
      Haward, Virginia Transformer Corp., ABB, Cooper , Siemens
      

	Air Compressors     	
      Atlas Copco, Cooper (Joy) Turbo Division, AC Compressors,
      Quincy, Hamworthy Belliss & Morcom (UK), Said Macchine Impianti (IT),
      Ingersol Rand 

	Switchgear     	
      Powell, Powercon Corp., S&C Electric Canada Ltd,
      Babco Electric & Engineering Ltd (CN), Blenkhorn & Sawle (CN),
      Ardan (ISR), Schneider (ISR) ; Siemens 

	Central Station Control   	
      Ormat Systems 

        HMI-Citect, Cimplicity 

        PLC-Allen Bradley, GE 

	Motor Control Center     	
      Allan Bradley, GE, Merlin Gerin; Moller Electric Inc.
      (CN), ADEX (ISR), ILS (ISR), Schneider (FR), ABB; Siemens ; Holec;
      Terasaki 

	Step-up Transformer 	
      Waukesha Electric System, Virginia Transformer
  

75

EXECUTION COPY 

  	Equipment Item 	Name of Supplier/Vendor 
	    	Corp., Elco (ISR), Fortune Electric
      Co. (TW), ABB; Fortune; 

	Pumps   	Goulds Pumps, Floway Pumps,
      FlowServe, Bungartz (GER) 

	Instruments and Control Valves
          	Neles Control Group, Jamesbury Inc.,
      Fisher Controls Int’l LLC, De Zurick, Habonim Industrial Valves LTD (ISR),
      Hamlet (ISR), Masoneilan, Vanessa Valve Corporation (IT), Tyco ;
      Flowserve; Valtek; Tyco 

	*1 	
      As being part of the OEC, which is a complete unit,
      Contractor or Ormat System may, at its discretion, assign the
      manufacturing of part or all of the OEC Heat Exchanger to an outside
      manufacturer, with the adequate certifications under Contractor or Ormat
      System design and supervision. 

76

EXECUTION COPY 

EXHIBIT G 

PERMITS 

          This
Exhibit G defines the current scope and allocation of permitting and contracting
work for the Project. Contractor is responsible for only the permits expressly
designated below as being the responsibility of Contractor; Company is
responsible for obtaining all other Project related permits. 

	PERMITS & CONTRACTS
      
  	Prepare by and
      
responsibility party 

	Conditional Use Permit 	Company 
	Production Well Permits 	Company 
	Injection Well Permits 	Company 
	Air Quality Permit to Construct 	Company 
	Water Rights Use for CT 	Company 
	Transmission Easements (through BLM) 	Company 
	Pipeline road easements (from highway
      district) 	Company 
	Private land lease & easements 	Company 
	Geothermal leases 	Company 
	County Building Permit – Power Plant 	Contractor 
	Storm Water Pollution Prevention
      Plan – Power Plant 
(containment plan during construction) 	Contractor* 
  

	Storm Water Pollution Prevention
      Plan 
(containment plan during operation) 	Company 
  

	Blowdown land application 	Company 
	Certificate of occupancy 	Company 
	Boiler permits 	Company 
	Idaho Power Certifications 	Company 

* Contractor shall not be responsible
for any delay that may occur in obtaining Governmental Authority approval of the
Storm Water Pollution Prevention Plan. 

77

EXECUTION COPY 

EXHIBIT H 

CERTIFICATE OF SUBSTANTIAL COMPLETION 

US Geothermal, Inc. 
1509 Tyrell Lane, Suite B 
Boise, ID
83706 
Attn: Daniel Kunz 

          With
reference to the ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT (the
“Contract”) dated September __, 2005 between US GEOTHERMAL, INC. (“Company”),
and ORMAT NEVADA, INC. (“Contractor”) for construction of the unit number one
Raft River Geothermal Project power plant in Cassia County, Idaho, Company
hereby confirms and certifies that the requirements of the Contract for
Substantial Completion set forth in the Contract have been achieved as of
_____________, 200_. 

          Terms
defined in the Contract shall have the same meaning when used herein. 

          Executed
this ____ day of ________________, 200__. 

Ormat Nevada, Inc. 

By:
________________________________
Name:
______________________________
Title: _______________________________

78

EXECUTION COPY 

EXHIBIT I 

CERTIFICATE OF FINAL COMPLETION 

US Geothermal, Inc. 
1509 Tyrell Lane, Suite B 
Boise, ID
83706 
Attn: Daniel Kunz 

          With
reference to the ENGINEERING, PROCUREMENT AND CONSTRUCTION CONTRACT (the
“Contract”) dated as of December 5, 2005 between RAFT RIVER ENERGY I LLC
(“Company”), and ORMAT NEVADA, INC. (“Contractor”) for construction of the unit
number one Raft River Geothermal Project power plant in Cassia County, Idaho,
Company hereby confirms and certifies that the requirements of the Contract for
Final Completion set forth in the Section 4.4 of the Contract have been achieved
as of _____________, 200_. Attached hereto is a list of the Punchlist Items
submitted by Contractor for approval by Company pursuant to Section 4.9 of the
Contract. 

          Terms
defined in the Contract shall have the same meaning when used herein. 

          Executed
this ____ day of ________________, 200__. 

Ormat Nevada, Inc. 

By:
________________________________
Name:
______________________________
Title: _______________________________

AGREED: 

US Geothermal, Inc. 

By: ________________________________
Name:
______________________________
Title: _______________________________

Date Signed: _________________________

 

79

EXECUTION COPY 

EXHIBIT J 

FORM OF FINAL LIEN WAIVER 

WAIVER OF LIENS/RELEASE 
AND CERTIFICATE OF FINAL PAYMENT

          With
reference to the Engineering, Procurement and Construction Contract (“Contract”)
dated as of December 5 2005 between the undersigned, ORMAT NEVADA, INC.,
(“Contractor”) and US Geothermal, Inc. (“Company”) for construction of the unit
number one Raft River Geothermal Power Project power plant in Cassia County,
Idaho, Contractor hereby certifies and represents that it has made, or will
make, when due, full payment of all costs, charges and expenses incurred by it
or on its behalf for work, labor, services, materials and equipment supplied to
the foregoing premises and/or used in connection with its work under the
Contract with respect to the Facility, other than any thereof for which payment
has been requested in the invoice of even date herewith.

          Contractor
hereby covenants that it will require each of its subcontractors and material
suppliers to make full payment of all costs, charges and expenses incurred by
them or on their behalf for work, labor, services, materials and equipment
supplied to the foregoing premises and/or used by them in connection with the
undersigned’s work under the Contract with respect to the Facility, other than
any thereof for which payment has been requested in the invoice of even date
herewith.

          In
consideration of ____________________Dollars ($__________) as final payment
under the Contract for work performed by Contractor as of _________, 200_,
Contractor, upon receipt of such final payment hereby unconditionally releases
and forever discharges Company and Company’s premises and property from all
claims, liens and obligations of every nature arising out of or in connection
with the payment of the aforesaid final payment except as set forth below: 

          (Note:
If none, write “NONE” in space above. Any claims excepted must be described and
the specific amount claimed must be set forth.) 

          As
additional consideration for the aforesaid final payment, Contractor, upon
receipt of such payment agrees to indemnify and hold harmless Company from and
against all costs, losses, claims, causes of action, judgments and expenses,
including attorney’s fees arising out of or in connection with claims against
Company, which claims arise out of the performance of the work under the
Contract with respect to the Facility and which may be asserted by Contractor or
any of its Subcontractors or any of their representatives, officers, agents or
employees except for those claims listed above. 

80

EXECUTION COPY 

          The
foregoing shall not relieve Contractor of its obligations under the provisions
of the Contract, which by their nature survive completion of the work including,
without limitation, warranties, guarantees and indemnities. 

          Executed
this __________________day of ________________________, _____. 

ORMAT NEVADA, INC. 

 

By: 
______________________________

NAME: ___________________________

TITLE: 
___________________________

 

81

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EXHIBIT K 

LIQUIDATED DAMAGES AND BONUSES

1.      Delay
Liquidated Damages 

          If
the Substantial Completion Date does not occur on or before the Guaranteed
Substantial Completion Date, then Contractor shall pay to Company liquidated
damages calculated as the sum of the amount set forth below for each Day that
the Substantial Completion Date is after the Guaranteed Substantial Completion
Date during the period between the Guaranteed Substantial Completion Date
and the Substantial Completion Date: 

	Number of Days that Substantial 
Completion
      Occurs After the 
Guaranteed Substantial Completion 
Date	Amount of Liquidated Damages per
      
Day 
  

	0 - 3 Days 	$0 
	4 – 7 Days 	$4,300 
	8+ Days 	$7,100 

2.      Schedule
Bonus 

          If
the Substantial Completion Date occurs (a) before the Guaranteed Substantial
Completion Date and (b) no later than fifteen (15) months after the date of
issuance of the Notice to Proceed plus the extension days, if any, of the
Guaranteed Substantial Completion Date under the terms of this Contract, then
Company shall pay to Contractor a bonus calculated as the sum of the amount set
forth below for each Day that the Substantial Completion Date is before the
Guaranteed Substantial Completion Date:

	Number of Days that Substantial 
Completion
      Occurs Before the 
Guaranteed Substantial Completion 
Date 	Amount of Bonus per Day 
 
      
  
  

	0 - 3 Days 	$0 
	4 – 7 Days 	$2,100 
	8 - 14 Days 	$3,600 

82

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	15 – 30 Days 	$5,400 
	31+ Days 	$5,700 

The Schedule Bonus for any period greater than thirty (30) Days
shall be subject to the approval of Company, which approval shall be given if
the Facility and the remainder of the Project will be ready for operation on
such date. 

3.      Performance
Liquidated Damages 

     If the Net Deliverable Capacity
result from the final Capacity Test is less than the Performance Guarantee, then
Contractor shall pay to Company liquidated damages calculated as the sum of the
amount per kW for each kW that such Net Deliverable Capacity is less than the
Performance Guarantee as follows and in accordance with Formula 3 in Schedule A
of Exhibit D: 

	Amount of kW that the Net 
Deliverable
      Capacity is less than the 
Performance Guarantee 	Amount of Liquidated Damages per
      
kW 
  

	0 - 150 kW 	$900 
	150+ – 250 kW 	$1,800 
	250+ - 500 kW 	$2,400 
	500+ kW 	$3,800 

4.      Performance
Bonus 

          If
the Net Deliverable Capacity result from the final Capacity Test is greater than
the Performance Guarantee, then Company shall pay to Contractor a bonus
calculated as the sum of the amount per kW for each kW that such Net Deliverable
Capacity is greater than the Performance Guarantee as follows and in accordance
with Formula 4 in Schedule A of Exhibit D: 

83

EXECUTION COPY 

	Amount of kW that the Net 
Deliverable
      Capacity is greater than 
the Performance Guarantee 	Amount of Bonus per kW 
 
      
  

	0 - 150 kW 	$0 
	150+ - 250 kW	$500 
	250+ - 500 kW	$1,000 
	500+ kW 	$1,500 

84

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EXHIBIT L 

CHANGE ORDER FORM 

  	Prepared By: 

         	 

         	Change Order Form 

         	Rev. # 

         	Date 

         

	         
	    Description of Change  
          
	          
	         
	         
	         
	         
	          

  

  	Change Requested By:  	Date: 	  Basis of Change: 
	    

         
	 	   

  

	Price of this Change: 	 
	Additional time required for Change: 	 

	APPROVALS
	 	Name/Title/Company
      & Signature 	Date 
	Submitted By:
      
  
  	 
 
 	  
 
      
  

	Approved and Accepted
      By: 
  
  	 
 
 	  
 
      
  

	Other: 

	 	 

Attachments to this change Proposal: 
	 
	 
	 

85

EXECUTION COPY 

EXHIBIT M 

CHANGE ORDER REQUEST FORM 

  	Prepared By: 
  	 
  	Change Order Form 
  	Rev. # 
  	Date 
  

	         
	    Description of Change  
          
	          
	         
	         
	         
	         
	          

  

  	Change Requested By:  	Date: 	  Basis of Change: 
	    

         
	 	   

  

  	Price of this Change: 	 
	Additional time required for Change: 	 

  	APPROVALS
	 	Name/Title/Company & Signature

      	Date 
	Submitted By: 

          

          	 

         

         	  

          

          

	Approved and Accepted By:
        

          

          	 

         

         	  

          

          

	Other: 

        
	 	  

Attachments to this change Proposal: 
	 
	 
	 

86

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