FERC rendition of the electronically filed tariff records in Docket No. ER18- -

Filing Data:

CID: C000038

Filing Title:

Amended/Restated LGIA #1668 - NYISO, Con Edison and Bayonne Energy Center

Company Filing Identifier: 1361

Type of Filing Code: 10

Associated Filing Identifier: na

Tariff Title: NYISO Agreements

Tariff ID: 58

Payment Confirmation: N

Suspension Motion:

Tariff Record Data:

Record Content Description: Agreement No. 1668

Tariff Record Title: Amended/restated LGIA NYISO/Con Edison/Bayonne

Record Version Number: 2.0.0

Option Code: A

Tariff Record ID: 23

Tariff Record Collation Value: 5051800

Tariff Record Parent Identifier: 2

Proposed Date: 02-22-2018

Priority Order: 700

Record Change Type: change

Record Content Type: 2

Associated Filing Identifier: na

SERVICE AGREEMENT NO. 1668

SECOND AMENDED AND RESTATED

LARGE GENERATOR INTERCONNECTION AGREEMENT

BY AND AMONG

NEW YORK INDEPENDENT SYSTEM OPERATOR, INC.

AND

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.

AND

BAYONNE ENERGY CENTER, LLC

Dated as of February 22, 2018

SERVICE AGREEMENT NO. 1668

TABLE OF CONTENTS

Page Number

ARTICLE 1. DEFINITIONS .........................................................................................................1

ARTICLE 2. EFFECTIVE DATE, TERM AND TERMINATION ...........................................10

2.1 Effective Date................................................................................................... 10

2.2 Term of Agreement. ......................................................................................... 10

2.3 Termination. ..................................................................................................... 10

2.4 Termination Costs. ........................................................................................... 11

2.5 Disconnection. .................................................................................................. 11

2.6 Survival. ........................................................................................................... 12

ARTICLE 3. REGULATORY FILINGS ....................................................................................12

ARTICLE 4. SCOPE OF INTERCONNECTION SERVICE ....................................................12

4.1 Provision of Service. ........................................................................................ 12

4.2 No Transmission Delivery Service. ................................................................. 13

4.3 No Other Services. ........................................................................................... 13

ARTICLE 5. INTERCONNECTION FACILITIES ENGINEERING, PROCUREMENT, AND

CONSTRUCTION .........................................................................................................................13

5.1 Options. ............................................................................................................ 13

5.2 General Conditions Applicable to Option to Build. ......................................... 15

5.3 Liquidated Damages......................................................................................... 16

5.4 Power System Stabilizers. ................................................................................ 17

5.5 Equipment Procurement. .................................................................................. 17

5.6 Construction Commencement. ......................................................................... 18

5.7 Work Progress. ................................................................................................. 18

5.8 Information Exchange. ..................................................................................... 18

5.9 Limited Operation. ........................................................................................... 19

5.10 Developer’s Attachment Facilities (“DAF”). ................................................... 19

5.11 Connecting Transmission Owner’s Attachment Facilities Construction. ........ 20

5.12 Access Rights. .................................................................................................. 20

5.13 Lands of Other Property Owners. .................................................................... 21

5.14 Permits. ............................................................................................................ 21

5.15 Early Construction of Base Case Facilities. ..................................................... 21

5.16 Suspension. ...................................................................................................... 21

5.17 Taxes. ............................................................................................................... 22

5.18 Tax Status; Non-Jurisdictional Entities. ........................................................... 27

5.19 Modification. .................................................................................................... 27

ARTICLE 6. TESTING AND INSPECTION .............................................................................28

6.1 Pre-Commercial Operation Date Testing and Modifications........................... 28

6.2 Post-Commercial Operation Date Testing and Modifications. ........................ 28

6.3 Right to Observe Testing. ................................................................................ 29

6.4 Right to Inspect. ............................................................................................... 29

ARTICLE 7. METERING ...........................................................................................................29

7.1 General. ............................................................................................................ 29

7.2 Check Meters. .................................................................................................. 29

7.3 Standards. ......................................................................................................... 30

SERVICE AGREEMENT NO. 1668

7.4 Testing of Metering Equipment. ...................................................................... 30

7.5 Metering Data................................................................................................... 30

ARTICLE 8. COMMUNICATIONS ..........................................................................................30

8.1 Developer Obligations. .................................................................................... 30

8.2 Remote Terminal Unit...................................................................................... 31

8.3 No Annexation. ................................................................................................ 31

ARTICLE 9. OPERATIONS .......................................................................................................31

9.1 General. ............................................................................................................ 31

9.2 NYISO and Connecting Transmission Owner Obligations. ............................ 32

9.3 Developer Obligations. .................................................................................... 32

9.4 Start-Up and Synchronization. ......................................................................... 32

9.5 Real and Reactive Power Control. ................................................................... 32

9.6 Outages and Interruptions. ............................................................................... 34

9.7 Switching and Tagging Rules. ......................................................................... 37

9.8 Use of Attachment Facilities by Third Parties. ................................................ 37

9.9 Disturbance Analysis Data Exchange. ............................................................. 38

9.10 Phasor Measurement Units .............................................................................. 38

ARTICLE 10. MAINTENANCE ..................................................................................................38

10.1 Connecting Transmission Owner Obligations. ................................................ 38

10.2 Developer Obligations. .................................................................................... 39

10.3 Coordination. .................................................................................................... 39

10.4 Secondary Systems. ......................................................................................... 39

10.5 Operating and Maintenance Expenses. ............................................................ 39

ARTICLE 11. PERFORMANCE OBLIGATION ........................................................................39

11.1 Developer’s Attachment Facilities. .................................................................. 39

11.2 Connecting Transmission Owner’s Attachment Facilities. .............................. 40

11.3 System Upgrade Facilities and System Deliverability Upgrades. ................... 40

11.4 Special Provisions for Affected Systems. ........................................................ 40

11.5 Provision of Security. ....................................................................................... 40

11.6 Developer Compensation for Emergency Services.......................................... 41

11.7 Line Outage Costs. ........................................................................................... 41

ARTICLE 12. INVOICE ...............................................................................................................41

12.1 General. ............................................................................................................ 41

12.2 Final Invoice..................................................................................................... 41

12.3 Payment. ........................................................................................................... 42

12.4 Disputes. ........................................................................................................... 42

ARTICLE 13. EMERGENCIES....................................................................................................42

13.1 Obligations. ...................................................................................................... 42

13.2 Notice. .............................................................................................................. 42

13.3 Immediate Action. ............................................................................................ 43

13.4 NYISO and Connecting Transmission Owner Authority. ............................... 43

13.5 Developer Authority......................................................................................... 44

13.6 Limited Liability. ............................................................................................. 44

ARTICLE 14. REGULATORY REQUIREMENTS AND GOVERNING LAW ........................44

14.1 Regulatory Requirements. ................................................................................ 44

14.2 Governing Law................................................................................................. 44

SERVICE AGREEMENT NO. 1668

iii

ARTICLE 15. NOTICES ...............................................................................................................45

15.1 General. ............................................................................................................ 45

15.2 Billings and Payments. ..................................................................................... 45

15.3 Alternative Forms of Notice. ........................................................................... 45

15.4 Operations and Maintenance Notice. ............................................................... 45

ARTICLE 16. FORCE MAJEURE ...............................................................................................45

ARTICLE 17. DEFAULT .............................................................................................................46

17.1 General. ............................................................................................................ 46

17.2 Right to Terminate. .......................................................................................... 46

ARTICLE 18. INDEMNITY, CONSEQUENTIAL DAMAGES AND INSURANCE ...............46

18.1 Indemnity. ........................................................................................................ 46

18.2 No Consequential Damages. ............................................................................ 47

18.3 Insurance. ......................................................................................................... 48

ARTICLE 19. ASSIGNMENT ......................................................................................................50

ARTICLE 20. SEVERABILITY ...................................................................................................50

ARTICLE 21. COMPARABILITY ...............................................................................................51

ARTICLE 22. CONFIDENTIALITY............................................................................................51

22.1 Confidentiality. ................................................................................................ 51

22.2 Term. ................................................................................................................ 51

22.3 Confidential Information. ................................................................................. 51

22.4 Scope. ............................................................................................................... 51

22.5 Release of Confidential Information. ............................................................... 52

22.6 Rights. .............................................................................................................. 52

22.7 No Warranties. ................................................................................................. 52

22.8 Standard of Care. .............................................................................................. 52

22.9 Order of Disclosure. ......................................................................................... 52

22.10 Termination of Agreement. .............................................................................. 53

22.11 Remedies. ......................................................................................................... 53

22.12 Disclosure to FERC, its Staff, or a State. ......................................................... 53

22.13 Required Notices Upon Requests or Demands for Confidential Information . 54

ARTICLE 23. DEVELOPER AND CONNECTING TRANSMISSION OWNER NOTICES OF

ENVIRONMENTAL RELEASES ................................................................................................54

ARTICLE 24. INFORMATION REQUIREMENT ......................................................................54

24.1 Information Acquisition. .................................................................................. 54

24.2 Information Submission by Connecting Transmission Owner. ....................... 54

24.3 Updated Information Submission by Developer. ............................................. 55

24.4 Information Supplementation........................................................................... 55

ARTICLE 25. INFORMATION ACCESS AND AUDIT RIGHTS .............................................56

25.1 Information Access. ......................................................................................... 56

25.2 Reporting of Non-Force Majeure Events. ........................................................ 56

25.3 Audit Rights. .................................................................................................... 56

25.4 Audit Rights Periods. ....................................................................................... 57

25.5 Audit Results. ................................................................................................... 57

ARTICLE 26. SUBCONTRACTORS ..........................................................................................57

26.1 General. ............................................................................................................ 57

26.2 Responsibility of Principal. .............................................................................. 57

SERVICE AGREEMENT NO. 1668

26.3 No Limitation by Insurance. ............................................................................ 58

ARTICLE 27. DISPUTES .............................................................................................................58

27.1 Submission. ...................................................................................................... 58

27.2 External Arbitration Procedures. ...................................................................... 58

27.3 Arbitration Decisions. ...................................................................................... 58

27.4 Costs. ................................................................................................................ 59

27.5 Termination. ..................................................................................................... 59

ARTICLE 28. REPRESENTATIONS, WARRANTIES AND COVENANTS ...........................59

28.1 General. ............................................................................................................ 59

ARTICLE 29. MISCELLANEOUS ..............................................................................................60

29.1 Binding Effect. ................................................................................................. 60

29.2 Conflicts. .......................................................................................................... 60

29.3 Rules of Interpretation...................................................................................... 60

29.4 Compliance. ..................................................................................................... 61

29.5 Joint and Several Obligations. ......................................................................... 61

29.6 Entire Agreement. ............................................................................................ 61

29.7 No Third Party Beneficiaries. .......................................................................... 61

29.8 Waiver. ............................................................................................................. 61

29.9 Headings. .......................................................................................................... 62

29.10 Multiple Counterparts. ..................................................................................... 62

29.11 Amendment. ..................................................................................................... 62

29.12 Modification by the Parties. ............................................................................. 62

29.13 Reservation of Rights. ...................................................................................... 62

29.14 No Partnership. ................................................................................................. 62

29.15 Other Transmission Rights. .............................................................................. 63

Appendices

SERVICE AGREEMENT NO. 1668

SECOND AMENDED AND RESTATED LARGE GENERATOR

INTERCONNECTION AGREEMENT

THIS SECOND AMENDED AND RESTATED LARGE GENERATOR

INTERCONNECTION AGREEMENT (“Agreement”) is made and entered into this 22nd

day of February 2018, by and among Bayonne Energy Center, LLC, a limited liability

corporation organized and existing under the laws of the State/Commonwealth of Delaware

(“Developer” with a Large Generating Facility), the New York Independent System Operator,

Inc., a not-for-profit corporation organized and existing under the laws of the State of New York

(“NYISO”), and Consolidated Edison Company of New York, Inc., a transportation corporation

organized and existing under the laws of the State of New York (“Connecting Transmission

Owner”). Developer, the NYISO, or Connecting Transmission Owner each may be referred to

as a “Party” or collectively referred to as the “Parties.”

RECITALS

WHEREAS, NYISO operates the New York State Transmission System and Connecting

Transmission Owner owns certain facilities included in the New York State Transmission

System;

WHEREAS, Developer intends to own, lease and/or control and operate the Generating Facility

identified as a Large Generating Facility in Appendix C to this Agreement; and,

WHEREAS, Developer, NYISO, and Connecting Transmission Owner have agreed to enter into

this Agreement for the purpose of interconnecting the Large Generating Facility with the New

York State Transmission System;

NOW, THEREFORE, in consideration of and subject to the mutual covenants contained herein,

it is agreed:

ARTICLE 1. DEFINITIONS

Whenever used in this Agreement with initial capitalization, the following terms shall have the

meanings specified in this Article 1. Terms used in this Agreement with initial capitalization that

are not defined in this Article 1 shall have the meanings specified in Section 1 of the ISO OATT,

Section 30.1 of Attachment X of the ISO OATT, Section 25.1.2 of Attachment S of the ISO

OATT, the body of the LFIP or the body of this Agreement.

Affected System shall mean an electric system other than the transmission system owned,

controlled or operated by the Connecting Transmission Owner that may be affected by the

proposed interconnection.

Affected System Operator shall mean the entity that operates an Affected System.

Affected Transmission Owner shall mean the New York public utility or authority (or its

designated agent) other than the Connecting Transmission Owner that (i) owns facilities used for

the transmission of Energy in interstate commerce and provides Transmission Service under the

SERVICE AGREEMENT NO. 1668

Tariff, and (ii) owns, leases or otherwise possesses an interest in a portion of the New York State

Transmission System where System Deliverability Upgrades or System Upgrade Facilities are

installed pursuant to Attachment X and Attachment S of the Tariff.

Affiliate shall mean, with respect to a person or entity, any individual, corporation, partnership,

firm, joint venture, association, joint-stock company, trust or unincorporated organization,

directly or indirectly controlling, controlled by, or under common control with, such person or

entity. The term “control” shall mean the possession, directly or indirectly, of the power to

direct the management or policies of a person or an entity. A voting interest of ten percent or

more shall create a rebuttable presumption of control.

Ancillary Services shall mean those services that are necessary to support the transmission of

Capacity and Energy from resources to Loads while maintaining reliable operation of the New

York State Transmission System in accordance with Good Utility Practice.

Applicable Laws and Regulations shall mean all duly promulgated applicable federal, state and

local laws, regulations, rules, ordinances, codes, decrees, judgments, directives, or judicial or

administrative orders, permits and other duly authorized actions of any Governmental Authority,

including but not limited to Environmental Law.

Applicable Reliability Councils shall mean the NERC, the NPCC and the NYSRC.

Applicable Reliability Standards shall mean the requirements and guidelines of the Applicable

Reliability Councils, and the Transmission District to which the Developer’s Large Generating

Facility is directly interconnected, as those requirements and guidelines are amended and

modified and in effect from time to time; provided that no Party shall waive its right to challenge

the applicability or validity of any requirement or guideline as applied to it in the context of this

Agreement.

Attachment Facilities shall mean the Connecting Transmission Owner’s Attachment Facilities

and the Developer’s Attachment Facilities. Collectively, Attachment Facilities include all

facilities and equipment between the Large Generating Facility and the Point of Interconnection,

including any modification, additions or upgrades that are necessary to physically and

electrically interconnect the Large Generating Facility to the New York State Transmission

System. Attachment Facilities are sole use facilities and shall not include Stand Alone System

Upgrade Facilities, Distribution Upgrades, System Upgrade Facilities or System Deliverability

Upgrades.

Base Case shall mean the base case power flow, short circuit, and stability data bases used for

the Interconnection Studies by NYISO, Connecting Transmission Owner or Developer;

described in Section 30.2.3 of the Standard Large Facility Interconnection Procedures.

Breach shall mean the failure of a Party to perform or observe any material term or condition of

this Agreement.

Breaching Party shall mean a Party that is in Breach of this Agreement.

Business Day shall mean Monday through Friday, excluding federal holidays.

SERVICE AGREEMENT NO. 1668

Byway shall mean all transmission facilities comprising the New York State Transmission

System that are neither Highways nor Other Interfaces. All transmission facilities in Zone J and

Zone K are Byways.

Calendar Day shall mean any day including Saturday, Sunday or a federal holiday.

Capacity Region shall mean one of four subsets of the Installed Capacity statewide markets

comprised of (1) Rest of State (i.e., Load Zones A through F); (2) Lower Hudson Valley (i.e.,

Load Zones G, H and I); (3) New York City (i.e., Load Zone J); and (4) Long Island (i.e., Load

Zone K) , except for Class Year Interconnection Facility Studies conducted prior to Class Year

2012, for which “Capacity Region” shall be defined as set forth in Section 25.7.3 of Attachment

S to the ISO OATT.

Capacity Resource Interconnection Service (“CRIS”) shall mean the service provided by

NYISO to Developers that satisfy the NYISO Deliverability Interconnection Standard or that are

otherwise eligible to receive CRIS in accordance with Attachment S to the ISO OATT; such

service being one of the eligibility requirements for participation as a NYISO Installed Capacity

Supplier.

Class Year Deliverability Study shall mean an assessment, conducted by the NYISO staff in

cooperation with Market Participants, to determine whether System Deliverability Upgrades are

required for Class Year CRIS Projects under the NYISO Deliverability Interconnection Standard.

Commercial Operation shall mean the status of a Large Generating Facility that has

commenced generating electricity for sale, excluding electricity generated during Trial

Operation.

Commercial Operation Date of a unit shall mean the date on which the Large Generating

Facility commences Commercial Operation as agreed to by the Parties pursuant to Appendix E to

this Agreement.

Confidential Information shall mean any information that is defined as confidential by

Article 22 of this Agreement.

Connecting Transmission Owner shall mean the New York public utility or authority (or its

designated agent) that (i) owns facilities used for the transmission of Energy in interstate

commerce and provides Transmission Service under the Tariff, (ii) owns, leases or otherwise

possesses an interest in the portion of the New York State Transmission System or Distribution

System at the Point of Interconnection, and (iii) is a Party to this Agreement.

Connecting Transmission Owner’s Attachment Facilities shall mean all facilities and

equipment owned, controlled or operated by the Connecting Transmission Owner from the Point

of Change of Ownership to the Point of Interconnection as identified in Appendix A to the

Standard Large Generator Interconnection Agreement, including any modifications, additions or

upgrades to such facilities and equipment. Connecting Transmission Owner’s Attachment

Facilities are sole use facilities and shall not include Stand Alone System Upgrade Facilities,

System Upgrade Facilities, or System Deliverability Upgrades.

SERVICE AGREEMENT NO. 1668

Control Area shall mean an electric power system or combination of electric power systems to

which a common automatic generation control scheme is applied in order to: (1) match, at all

times, the power output of the Generators within the electric power system(s) and capacity and

energy purchased from entities outside the electric power system(s), with the Load within the

electric power system(s); (2) maintain scheduled interchange with other Control Areas, within

the limits of Good Utility Practice; (3) maintain the frequency of the electric power system(s)

within reasonable limits in accordance with Good Utility Practice; and (4) provide sufficient

generating capacity to maintain Operating Reserves in accordance with Good Utility Practice. A

Control Area must be certified by the NPCC.

Default shall mean the failure of a Party in Breach of this Agreement to cure such Breach in

accordance with Article 17 of this Agreement.

Developer shall mean an Eligible Customer developing a Large Generating Facility, proposing

to connect to the New York State Transmission System, in compliance with the NYISO

Minimum Interconnection Standard.

Developer’s Attachment Facilities shall mean all facilities and equipment, as identified in

Appendix A of this Agreement, that are located between the Large Generating Facility and the

Point of Change of Ownership, including any modification, addition, or upgrades to such

facilities and equipment necessary to physically and electrically interconnect the Large

Generating Facility to the New York State Transmission System. Developer’s Attachment

Facilities are sole use facilities.

Distribution System shall mean the Connecting Transmission Owner’s facilities and equipment

used to distribute electricity that are subject to FERC jurisdiction, and are subject to the

NYISO’s Large Facility Interconnection Procedures in Attachment X to the ISO OATT or Small

Generator Interconnection Procedures in Attachment Z to the ISO OATT under FERC Order

Nos. 2003 and/or 2006. The term Distribution System shall not include LIPA’s distribution

facilities.

Distribution Upgrades shall mean the additions, modifications, and upgrades to the Connecting

Transmission Owner’s Distribution System at or beyond the Point of Interconnection to facilitate

interconnection of a Large Facility or Small Generating Facility and render the transmission

service necessary to affect the Developer’s wholesale sale of electricity in interstate commerce.

Distribution Upgrades do not include Attachment Facilities, System Upgrade Facilities, or

System Deliverability Upgrades. Distribution Upgrades are sole use facilities and shall not

include Stand Alone System Upgrade Facilities, System Upgrade Facilities, or System

Deliverability Upgrades.

Effective Date shall mean the date on which this Agreement becomes effective upon execution

by the Parties, subject to acceptance by the Commission, or if filed unexecuted, upon the date

specified by the Commission.

Emergency State shall mean the condition or state that the New York State Power System is in

when an abnormal condition occurs that requires automatic or immediate manual action to

SERVICE AGREEMENT NO. 1668

prevent or limit loss of the New York State Transmission System or Generators that could

adversely affect the reliability of the New York State Power System.

Energy Resource Interconnection Service (“ERIS”) shall mean the service provided by

NYISO to interconnect the Developer’s Large Generating Facility to the New York State

Transmission System or to the Distribution System in accordance with the NYISO Minimum

Interconnection Standard, to enable the New York State Transmission System to receive Energy

and Ancillary Services from the Large Generating Facility, pursuant to the terms of the ISO

OATT.

Environmental Law shall mean Applicable Laws and Regulations relating to pollution or

protection of the environment or natural resources.

Federal Power Act shall mean the Federal Power Act, as amended, 16 U.S.C. §§ 791a et seq.

(“FPA”).

FERC shall mean the Federal Energy Regulatory Commission (“Commission”) or its successor.

Force Majeure shall mean any act of God, labor disturbance, act of the public enemy, war,

insurrection, riot, fire, storm or flood, explosion, breakage or accident to machinery or

equipment, any order, regulation or restriction imposed by governmental, military or lawfully

established civilian authorities, or any other cause beyond a Party’s control. A Force Majeure

event does not include acts of negligence or intentional wrongdoing by the Party claiming Force

Majeure.

Generating Facility shall mean Developer’s device for the production of electricity identified in

the Interconnection Request, but shall not include the Developer’s Attachment Facilities or

Distribution Upgrades.

Generating Facility Capacity shall mean the net seasonal capacity of the Generating Facility

and the aggregate net seasonal capacity of the Generating Facility where it includes multiple

energy production devices.

Good Utility Practice shall mean any of the practices, methods and acts engaged in or approved

by a significant portion of the electric industry during the relevant time period, or any of the

practices, methods and acts which, in the exercise of reasonable judgment in light of the facts

known at the time the decision was made, could have been expected to accomplish the desired

result at a reasonable cost consistent with good business practices, reliability, safety and

expedition. Good Utility Practice is not intended to be limited to the optimum practice, method,

or act to the exclusion of all others, but rather to delineate acceptable practices, methods, or acts

generally accepted in the region.

Governmental Authority shall mean any federal, state, local or other governmental regulatory

or administrative agency, court, commission, department, board, or other governmental

subdivision, legislature, rulemaking board, tribunal, or other governmental authority having

jurisdiction over any of the Parties, their respective facilities, or the respective services they

provide, and exercising or entitled to exercise any administrative, executive, police, or taxing

SERVICE AGREEMENT NO. 1668

authority or power; provided, however, that such term does not include Developer, NYISO,

Affected Transmission Owner, Connecting Transmission Owner, or any Affiliate thereof.

Hazardous Substances shall mean any chemicals, materials or substances defined as or

included in the definition of “hazardous substances,” “hazardous wastes,” “hazardous materials,”

“hazardous constituents,” “restricted hazardous materials,” “extremely hazardous substances,”

“toxic substances,” “radioactive substances,” “contaminants,” “pollutants,” “toxic pollutants” or

words of similar meaning and regulatory effect under any applicable Environmental Law, or any

other chemical, material or substance, exposure to which is prohibited, limited or regulated by

any applicable Environmental Law.

Highway shall mean 115 kV and higher transmission facilities that comprise the following

NYCA interfaces: Dysinger East, West Central, Volney East, Moses South, Central East/Total

East and UPNY-ConEd, and their immediately connected, in series, bulk power system facilities

in New York State. Each interface shall be evaluated to determine additional “in series”

facilities, defined as any transmission facility higher than 115 kV that (a) is located in an

upstream or downstream zone adjacent to the interface and (b) has a power transfer distribution

factor (DFAX) equal to or greater than five percent when the aggregate of generation in zones or

systems adjacent to the upstream zone or zones that define the interface is shifted to the

aggregate of generation in zones or systems adjacent to the downstream zone or zones that define

the interface. In determining “in series” facilities for Dysinger East and West Central interfaces,

the 115 kV and 230 kV tie lines between NYCA and PJM located in LBMP Zones A and B shall

not participate in the transfer. Highway transmission facilities are listed in ISO Procedures.

Initial Synchronization Date shall mean the date upon which the Large Generating Facility is

initially synchronized and upon which Trial Operation begins.

In-Service Date shall mean the date upon which the Developer reasonably expects it will be

ready to begin use of the Connecting Transmission Owner’s Attachment Facilities to obtain back

feed power.

Interconnection Facilities Study shall mean a study conducted by NYISO or a third party

consultant for the Developer to determine a list of facilities (including Connecting Transmission

Owner’s Attachment Facilities, Distribution Upgrades, System Upgrade Facilities and System

Deliverability Upgrades as identified in the Interconnection System Reliability Impact Study),

the cost of those facilities, and the time required to interconnect the Large Generating Facility

with the New York State Transmission System or with the Distribution System. The scope of

the study is defined in Section 30.8 of the Standard Large Facility Interconnection Procedures.

Interconnection Facilities Study Agreement shall mean the form of agreement contained in

Appendix 2 of the Standard Large Facility Interconnection Procedures for conducting the

Interconnection Facilities Study.

Interconnection Request shall mean a Developer’s request, in the form of Appendix 1 to the

Standard Large Facility Interconnection Procedures, in accordance with the Tariff, to

interconnect a new Large Generating Facility to the New York State Transmission System or to

the Distribution System, or to materially increase the capacity of, or make a material

SERVICE AGREEMENT NO. 1668

modification to the operating characteristics of, an existing Large Generating Facility that is

interconnected with the New York State Transmission System or with the Distribution System.

Interconnection Study shall mean any of the following studies: the Optional Interconnection

Feasibility Study, the Interconnection System Reliability Impact Study, and the Interconnection

Facilities Study described in the Standard Large Facility Interconnection Procedures.

Interconnection System Reliability Impact Study (“SRIS”) shall mean an engineering study,

conducted in accordance with Section 30.7 of the Standard Large Facility Interconnection

Procedures, that evaluates the impact of the proposed Large Generating Facility on the safety and

reliability of the New York State Transmission System and, if applicable, an Affected System, to

determine what Attachment Facilities, Distribution Upgrades and System Upgrade Facilities are

needed for the proposed Large Generating Facility of the Developer to connect reliably to the

New York State Transmission System or to the Distribution System in a manner that meets the

NYISO Minimum Interconnection Standard in Attachment X to the ISO OATT.

IRS shall mean the Internal Revenue Service.

Large Generating Facility shall mean a Generating Facility having a Generating Facility

Capacity of more than 20 MW.

Loss shall mean any and all losses relating to injury to or death of any person or damage to

property, demand, suits, recoveries, costs and expenses, court costs, attorney fees, and all other

obligations by or to third parties, arising out of or resulting from the Indemnified Party’s

performance or non-performance of its obligations under this Agreement on behalf of the

Indemnifying Party, except in cases of gross negligence or intentional wrongdoing by the

Indemnified Party.

Material Modification shall mean those modifications that have a material impact on the cost or

timing of any Interconnection Request with a later queue priority date.

Metering Equipment shall mean all metering equipment installed or to be installed at the Large

Generating Facility pursuant to this Agreement at the metering points, including but not limited

to instrument transformers, MWh-meters, data acquisition equipment, transducers, remote

terminal unit, communications equipment, phone lines, and fiber optics.

NERC shall mean the North American Electric Reliability Council or its successor organization.

New York State Transmission System shall mean the entire New York State electric

transmission system, which includes (i) the Transmission Facilities Under ISO Operational

Control; (ii) the Transmission Facilities Requiring ISO Notification; and (iii) all remaining

transmission facilities within the New York Control Area.

Notice of Dispute shall mean a written notice of a dispute or claim that arises out of or in

connection with this Agreement or its performance.

NPCC shall mean the Northeast Power Coordinating Council or its successor organization.

SERVICE AGREEMENT NO. 1668

NYISO Deliverability Interconnection Standard – The standard that must be met, unless

otherwise provided for by Attachment S to the ISO OATT, by (i) any generation facility larger

than 2MW in order for that facility to obtain CRIS; (ii) any Merchant Transmission Facility

proposing to interconnect to the New York State Transmission System and receive Unforced

Capacity Delivery Rights; (iii) any entity requesting External CRIS Rights, and (iv) any entity

requesting a CRIS transfer pursuant to Section 25.9.5 of Attachment S to the ISO OATT. To

meet the NYISO Deliverability Interconnection Standard, the Interconnection Customer must, in

accordance with the rules in Attachment S to the ISO OATT, fund or commit to fund any System

Deliverability Upgrades identified for its project in the Class Year Deliverability Study.

NYISO Minimum Interconnection Standard – The reliability standard that must be met by

any generation facility or Merchant Transmission Facility that is subject to NYISO’s Large

Facility Interconnection Procedures in Attachment X to the ISO OATT or the NYISO’s Small

Generator Interconnection Procedures in Attachment Z, that is proposing to connect to the New

York State Transmission System or Distribution System, to obtain ERIS. The Minimum

Interconnection Standard is designed to ensure reliable access by the proposed project to the

New York State Transmission System or to the Distribution System. The Minimum

Interconnection Standard does not impose any deliverability test or deliverability requirement on

the proposed interconnection.

NYSRC shall mean the New York State Reliability Council or its successor organization.

Other Interfaces shall mean the following interfaces into Capacity Regions: Lower Hudson

Valley [i.e., Rest of State (Load Zones A-F) to Lower Hudson Valley (Load Zones G, H and I)];

New York City [i.e., Lower Hudson Valley (Load Zones G, H and I) to New York City (Load

Zone J)]; and Long Island [i.e., Lower Hudson Valley (Load Zones G, H and I) to Long Island

(Load Zone K)], and the following Interfaces between the NYCA and adjacent Control Areas:

PJM to NYISO, ISO-NE to NYISO, Hydro-Quebec to NYISO, and Norwalk Harbor

(Connecticut) to Northport (Long Island) Cable.

Party or Parties shall mean NYISO, Connecting Transmission Owner, or Developer or any

combination of the above.

Point of Change of Ownership shall mean the point, as set forth in Appendix A to this

Agreement, where the Developer’s Attachment Facilities connect to the Connecting

Transmission Owner’s Attachment Facilities.

Point of Interconnection shall mean the point, as set forth in Appendix A to this Agreement,

where the Attachment Facilities connect to the New York State Transmission System or to the

Distribution System.

Reasonable Efforts shall mean, with respect to an action required to be attempted or taken by a

Party under this Agreement, efforts that are timely and consistent with Good Utility Practice and

are otherwise substantially equivalent to those a Party would use to protect its own interests.

Retired: A Generator that has permanently ceased operating on or after May 1, 2015 either: i)

pursuant to applicable notice; or ii) as a result of the expiration of its Mothball Outage or its

ICAP Ineligible Forced Outage.

SERVICE AGREEMENT NO. 1668

Services Tariff shall mean the NYISO Market Administration and Control Area Tariff, as filed

with the Commission, and as amended or supplemented from time to time, or any successor tariff

thereto.

Stand Alone System Upgrade Facilities shall mean System Upgrade Facilities that a Developer

may construct without affecting day-to-day operations of the New York State Transmission

System during their construction. NYISO, the Connecting Transmission Owner and the

Developer must agree as to what constitutes Stand Alone System Upgrade Facilities and identify

them in Appendix A to this Agreement.

Standard Large Facility Interconnection Procedures (“Large Facility Interconnection

Procedures” or “LFIP”) shall mean the interconnection procedures applicable to an

Interconnection Request pertaining to a Large Generating Facility that are included in

Attachment X of the ISO OATT.

Standard Large Generator Interconnection Agreement (“LGIA”) shall mean this

Agreement, which is the form of interconnection agreement applicable to an Interconnection

Request pertaining to a Large Generating Facility, that is included in Appendix 6 to Attachment

X of the ISO OATT.

System Deliverability Upgrades shall mean the least costly configuration of commercially

available components of electrical equipment that can be used, consistent with Good Utility

Practice and Applicable Reliability Requirements, to make the modifications or additions to

Byways and Highways and Other Interfaces on the existing New York State Transmission

System and Distribution System that are required for the proposed project to connect reliably to

the system in a manner that meets the NYISO Deliverability Interconnection Standard at the

requested level of Capacity Resource Interconnection Service.

System Protection Facilities shall mean the equipment, including necessary protection signal

communications equipment, required to (1) protect the New York State Transmission System

from faults or other electrical disturbances occurring at the Large Generating Facility and (2)

protect the Large Generating Facility from faults or other electrical system disturbances

occurring on the New York State Transmission System or on other delivery systems or other

generating systems to which the New York State Transmission System is directly connected.

System Upgrade Facilities shall mean the least costly configuration of commercially available

components of electrical equipment that can be used, consistent with Good Utility Practice and

Applicable Reliability Requirements, to make the modifications to the existing transmission

system that are required to maintain system reliability due to: (i) changes in the system,

including such changes as load growth and changes in load pattern, to be addressed in the form

of generic generation or transmission projects; and (ii) proposed interconnections. In the case of

proposed interconnection projects, System Upgrade Facilities are the modifications or additions

to the existing New York State Transmission System that are required for the proposed project to

connect reliably to the system in a manner that meets the NYISO Minimum Interconnection

Standard.

SERVICE AGREEMENT NO. 1668

Tariff shall mean the NYISO Open Access Transmission Tariff (“OATT”), as filed with the

Commission, and as amended or supplemented from time to time, or any successor tariff.

Trial Operation shall mean the period during which Developer is engaged in on-site test

operations and commissioning of the Large Generating Facility prior to Commercial Operation.

ARTICLE 2. EFFECTIVE DATE, TERM AND TERMINATION

2.1 Effective Date.

This Agreement shall become effective upon execution by the Parties, subject to

acceptance by FERC, or if filed unexecuted, upon the date specified by FERC. Upon its

effectiveness, this Agreement will supersede and replace the October 16, 2013 Amended and

Restated Large Generator Interconnection Agreement among the Developer, NYISO and

Connecting Transmission Owner, without prejudice to any rights, claims, or obligation under the

October 2013 LGIA that have accrued as of the date of effectiveness of this Agreement. The

NYISO and Connecting Transmission Owner shall promptly file this Agreement with FERC

upon execution in accordance with Article 3.

2.2 Term of Agreement.

Subject to the provisions of Article 2.3, this Agreement shall remain in effect for a period

of thirty (30) years from November 10, 2010 and shall be automatically renewed for each

successive one-year period thereafter.

2.3 Termination.

2.3.1 Written Notice.

This Agreement may be terminated by the Developer after giving the NYISO and

Connecting Transmission Owner ninety (90) Calendar Days advance written notice, or by the

NYISO and Connecting Transmission Owner notifying FERC after the Large Generating

Facility is Retired.

2.3.2 Default.

Any Party may terminate this Agreement in accordance with Article 17.

2.3.3 Compliance.

Notwithstanding Articles 2.3.1 and 2.3.2, no termination of this Agreement shall become

effective until the Parties have complied with all Applicable Laws and Regulations applicable to

such termination, including the filing with FERC of a notice of termination of this Agreement,

which notice has been accepted for filing by FERC.

SERVICE AGREEMENT NO. 1668

2.4 Termination Costs.

If a Party elects to terminate this Agreement pursuant to Article 2.3.1 above, the

terminating Party shall pay all costs incurred (including any cancellation costs relating to orders

or contracts for Attachment Facilities and equipment) or charges assessed by the other Parties, as

of the date of the other Parties’ receipt of such notice of termination, that are the responsibility of

the terminating Party under this Agreement. In the event of termination by a Party, all Parties

shall use commercially Reasonable Efforts to mitigate the costs, damages and charges arising as

a consequence of termination. Upon termination of this Agreement, unless otherwise ordered or

approved by FERC:

2.4.1 With respect to any portion of the Connecting Transmission Owner’s

Attachment Facilities that have not yet been constructed or installed, the Connecting

Transmission Owner shall to the extent possible and with Developer’s authorization cancel any

pending orders of, or return, any materials or equipment for, or contracts for construction of,

such facilities; provided that in the event Developer elects not to authorize such cancellation,

Developer shall assume all payment obligations with respect to such materials, equipment, and

contracts, and the Connecting Transmission Owner shall deliver such material and equipment,

and, if necessary, assign such contracts, to Developer as soon as practicable, at Developer’s

expense. To the extent that Developer has already paid Connecting Transmission Owner for any

or all such costs of materials or equipment not taken by Developer, Connecting Transmission

Owner shall promptly refund such amounts to Developer, less any costs, including penalties

incurred by the Connecting Transmission Owner to cancel any pending orders of or return such

materials, equipment, or contracts.

If Developer terminates this Agreement, it shall be responsible for all costs incurred in

association with Developer’s interconnection, including any cancellation costs relating to orders

or contracts for Attachment Facilities and equipment, and other expenses including any System

Upgrade Facilities and System Deliverability Upgrades for which the Connecting Transmission

Owner has incurred expenses and has not been reimbursed by the Developer.

2.4.2 Connecting Transmission Owner may, at its option, retain any portion of such

materials, equipment, or facilities that Developer chooses not to accept delivery of, in which case

Connecting Transmission Owner shall be responsible for all costs associated with procuring such

materials, equipment, or facilities.

2.4.3 With respect to any portion of the Attachment Facilities, and any other

facilities already installed or constructed pursuant to the terms of this Agreement, Developer

shall be responsible for all costs associated with the removal, relocation or other disposition or

retirement of such materials, equipment, or facilities.

2.5 Disconnection.

Upon termination of this Agreement, Developer and Connecting Transmission Owner

will take all appropriate steps to disconnect the Developer’s Large Generating Facility from the

New York State Transmission System. All costs required to effectuate such disconnection shall

be borne by the terminating Party, unless such termination resulted from the non-terminating

SERVICE AGREEMENT NO. 1668

Party’s Default of this Agreement or such non-terminating Party otherwise is responsible for

these costs under this Agreement.

2.6 Survival.

This Agreement shall continue in effect after termination to the extent necessary to

provide for final billings and payments and for costs incurred hereunder; including billings and

payments pursuant to this Agreement; to permit the determination and enforcement of liability

and indemnification obligations arising from acts or events that occurred while this Agreement

was in effect; and to permit Developer and Connecting Transmission Owner each to have access

to the lands of the other pursuant to this Agreement or other applicable agreements, to

disconnect, remove or salvage its own facilities and equipment.

ARTICLE 3. REGULATORY FILINGS

NYISO and Connecting Transmission Owner shall file this Agreement (and any

amendment hereto) with the appropriate Governmental Authority, if required. Any information

related to studies for interconnection asserted by Developer to contain Confidential Information

shall be treated in accordance with Article 22 of this Agreement and Attachment F to the ISO

OATT. If the Developer has executed this Agreement, or any amendment thereto, the Developer

shall reasonably cooperate with NYISO and Connecting Transmission Owner with respect to

such filing and to provide any information reasonably requested by NYISO and Connecting

Transmission Owner needed to comply with Applicable Laws and Regulations.

ARTICLE 4. SCOPE OF INTERCONNECTION SERVICE

4.1 Provision of Service.

NYISO will provide Developer with interconnection service of the following type for the

term of this Agreement.

4.1.1 Product.

NYISO will provide Energy Resource Interconnection Service and Capacity Resource

Interconnection Service to Developer at the Point of Interconnection, subject to the requirements

of Section 5 of Appendix A.

4.1.2 Developer

is responsible for ensuring that its actual Large Generating Facility output matches the

scheduled delivery from the Large Generating Facility to the New York State Transmission

System, consistent with the scheduling requirements of the NYISO’s FERC-approved market

structure, including ramping into and out of such scheduled delivery, as measured at the Point of

Interconnection, consistent with the scheduling requirements of the ISO OATT and any

applicable FERC-approved market structure.

SERVICE AGREEMENT NO. 1668

4.2 No Transmission Delivery Service.

The execution of this Agreement does not constitute a request for, nor agreement to

provide, any Transmission Service under the ISO OATT, and does not convey any right to

deliver electricity to any specific customer or Point of Delivery. If Developer wishes to obtain

Transmission Service on the New York State Transmission System, then Developer must request

such Transmission Service in accordance with the provisions of the ISO OATT.

4.3 No Other Services.

The execution of this Agreement does not constitute a request for, nor agreement to

provide Energy, any Ancillary Services or Installed Capacity under the NYISO Market

Administration and Control Area Services Tariff (“Services Tariff”). If Developer wishes to

supply Energy, Installed Capacity or Ancillary Services, then Developer will make application to

do so in accordance with the NYISO Services Tariff.

ARTICLE 5. INTERCONNECTION FACILITIES ENGINEERING,

PROCUREMENT, AND CONSTRUCTION

5.1 Options.

Unless otherwise mutually agreed to by Developer and Connecting Transmission Owner,

Developer shall select the In-Service Date, Initial Synchronization Date, and Commercial

Operation Date; and either Standard Option or Alternate Option set forth below for completion

of the Connecting Transmission Owner’s Attachment Facilities and System Upgrade Facilities

and System Deliverability Upgrades as set forth in Appendix A hereto, and such dates and

selected option shall be set forth in Appendix B hereto.

5.1.1 Standard Option.

The Connecting Transmission Owner shall design, procure, and construct the Connecting

Transmission Owner’s Attachment Facilities and System Upgrade Facilities and System

Deliverability Upgrades, using Reasonable Efforts to complete the Connecting Transmission

Owner’s Attachment Facilities and System Upgrade Facilities and System Deliverability

Upgrades by the dates set forth in Appendix B hereto. The Connecting Transmission Owner

shall not be required to undertake any action which is inconsistent with its standard safety

practices, its material and equipment specifications, its design criteria and construction

procedures, its labor agreements, and Applicable Laws and Regulations. In the event the

Connecting Transmission Owner reasonably expects that it will not be able to complete the

Connecting Transmission Owner’s Attachment Facilities and System Upgrade Facilities and

System Deliverability Upgrades by the specified dates, the Connecting Transmission Owner

shall promptly provide written notice to the Developer and NYISO, and shall undertake

Reasonable Efforts to meet the earliest dates thereafter.

5.1.2 Alternate Option.

If the dates designated by Developer are acceptable to Connecting Transmission Owner,

the Connecting Transmission Owner shall so notify Developer and NYISO within thirty (30)

SERVICE AGREEMENT NO. 1668

Calendar Days, and shall assume responsibility for the design, procurement and construction of

the Connecting Transmission Owner’s Attachment Facilities by the designated dates. If

Connecting Transmission Owner subsequently fails to complete Connecting Transmission

Owner’s Attachment Facilities by the In-Service Date, to the extent necessary to provide back

feed power; or fails to complete System Upgrade Facilities or System Deliverability Upgrades by

the Initial Synchronization Date to the extent necessary to allow for Trial Operation at full power

output, unless other arrangements are made by the Developer and Connecting Transmission

Owner for such Trial Operation; or fails to complete the System Upgrade Facilities and System

Deliverability Upgrades by the Commercial Operation Date, as such dates are reflected in

Appendix B hereto; Connecting Transmission Owner shall pay Developer liquidated damages in

accordance with Article 5.3, Liquidated Damages, provided, however, the dates designated by

Developer shall be extended day for day for each day that NYISO refuses to grant clearances to

install equipment.

5.1.3 Option to Build.

If the dates designated by Developer are not acceptable to Connecting Transmission

Owner, the Connecting Transmission Owner shall so notify the Developer and NYISO within

thirty (30) Calendar Days, and unless the Developer and Connecting Transmission Owner agree

otherwise, Developer shall have the option to assume responsibility for the design, procurement

and construction of Connecting Transmission Owner’s Attachment Facilities and Stand Alone

System Upgrade Facilities on the dates specified in Article 5.1.2; provided that if an Attachment

Facility or Stand Alone System Upgrade Facility is needed for more than one Developer’s

project, Developer’s option to build such facility shall be contingent on the agreement of all

other affected Developers. NYISO, Connecting Transmission Owner and Developer must agree

as to what constitutes Stand Alone System Upgrade Facilities and identify such Stand Alone

System Upgrade Facilities in Appendix A hereto. Except for Stand Alone System Upgrade

Facilities, Developer shall have no right to construct System Upgrade Facilities under this

option.

5.1.4 Negotiated Option.

If the Developer elects not to exercise its option under Article 5.1.3, Option to Build,

Developer shall so notify Connecting Transmission Owner and NYISO within thirty (30)

Calendar Days, and the Developer and Connecting Transmission Owner shall in good faith

attempt to negotiate terms and conditions (including revision of the specified dates and

liquidated damages, the provision of incentives or the procurement and construction of a portion

of the Connecting Transmission Owner’s Attachment Facilities and Stand Alone System

Upgrade Facilities by Developer) pursuant to which Connecting Transmission Owner is

responsible for the design, procurement and construction of the Connecting Transmission

Owner’s Attachment Facilities and System Upgrade Facilities and System Deliverability

Upgrades. If the two Parties are unable to reach agreement on such terms and conditions,

Connecting Transmission Owner shall assume responsibility for the design, procurement and

construction of the Connecting Transmission Owner’s Attachment Facilities and System

Upgrade Facilities and System Deliverability Upgrades pursuant to 5.1.1, Standard Option.

SERVICE AGREEMENT NO. 1668

5.2 General Conditions Applicable to Option to Build.

If Developer assumes responsibility for the design, procurement and construction of the

Connecting Transmission Owner’s Attachment Facilities and Stand Alone System Upgrade

Facilities, the following conditions apply:

5.2.1 Developer shall engineer, procure equipment, and construct the Connecting

Transmission Owner’s Attachment Facilities and Stand Alone System Upgrade Facilities (or

portions thereof) using Good Utility Practice and using standards and specifications provided in

advance by the Connecting Transmission Owner;

5.2.2 Developer’s engineering, procurement and construction of the Connecting

Transmission Owner’s Attachment Facilities and Stand Alone System Upgrade Facilities shall

comply with all requirements of law to which Connecting Transmission Owner would be subject

in the engineering, procurement or construction of the Connecting Transmission Owner’s

Attachment Facilities and Stand Alone System Upgrade Facilities;

5.2.3 Connecting Transmission Owner shall review and approve the engineering

design, equipment acceptance tests, and the construction of the Connecting Transmission

Owner’s Attachment Facilities and Stand Alone System Upgrade Facilities;

5.2.4 Prior to commencement of construction, Developer shall provide to Connecting

Transmission Owner and NYISO a schedule for construction of the Connecting Transmission

Owner’s Attachment Facilities and Stand Alone System Upgrade Facilities, and shall promptly

respond to requests for information from Connecting Transmission Owner or NYISO;

5.2.5 At any time during construction, Connecting Transmission Owner shall have the

right to gain unrestricted access to the Connecting Transmission Owner’s Attachment Facilities

and Stand Alone System Upgrade Facilities and to conduct inspections of the same;

5.2.6 At any time during construction, should any phase of the engineering, equipment

procurement, or construction of the Connecting Transmission Owner’s Attachment Facilities and

Stand Alone System Upgrade Facilities not meet the standards and specifications provided by

Connecting Transmission Owner, the Developer shall be obligated to remedy deficiencies in that

portion of the Connecting Transmission Owner’s Attachment Facilities and Stand Alone System

Upgrade Facilities;

5.2.7 Developer shall indemnify Connecting Transmission Owner and NYISO for

claims arising from the Developer’s construction of Connecting Transmission Owner’s

Attachment Facilities and Stand Alone System Upgrade Facilities under procedures applicable to

Article 18.1 Indemnity;

5.2.8 Developer shall transfer control of Connecting Transmission Owner’s

Attachment Facilities and Stand Alone System Upgrade Facilities to the Connecting

Transmission Owner;

SERVICE AGREEMENT NO. 1668

5.2.9 Unless the Developer and Connecting Transmission Owner otherwise agree,

Developer shall transfer ownership of Connecting Transmission Owner’s Attachment Facilities

and Stand Alone System Upgrade Facilities to Connecting Transmission Owner;

5.2.10 Connecting Transmission Owner shall approve and accept for operation and

maintenance the Connecting Transmission Owner’s Attachment Facilities and Stand Alone

System Upgrade Facilities to the extent engineered, procured, and constructed in accordance

with this Article 5.2; and

5.2.11 Developer shall deliver to NYISO and Connecting Transmission Owner “as

built” drawings, information, and any other documents that are reasonably required by NYISO or

Connecting Transmission Owner to assure that the Attachment Facilities and Stand Alone

System Upgrade Facilities are built to the standards and specifications required by Connecting

Transmission Owner.

5.3 Liquidated Damages.

The actual damages to the Developer, in the event the Connecting Transmission Owner’s

Attachment Facilities or System Upgrade Facilities or System Deliverability Upgrades are not

completed by the dates designated by the Developer and accepted by the Connecting

Transmission Owner pursuant to subparagraphs 5.1.2 or 5.1.4, above, may include Developer’s

fixed operation and maintenance costs and lost opportunity costs. Such actual damages are

uncertain and impossible to determine at this time. Because of such uncertainty, any liquidated

damages paid by the Connecting Transmission Owner to the Developer in the event that

Connecting Transmission Owner does not complete any portion of the Connecting Transmission

Owner’s Attachment Facilities, System Upgrade Facilities or System Deliverability Upgrades by

the applicable dates, shall be an amount equal to 1/2 of 1 percent per day of the actual cost of the

Connecting Transmission Owner’s Attachment Facilities and System Upgrade Facilities and

System Deliverability Upgrades, in the aggregate, for which Connecting Transmission Owner

has assumed responsibility to design, procure and construct.

However, in no event shall the total liquidated damages exceed 20 percent of the actual

cost of the Connecting Transmission Owner Attachment Facilities and System Upgrade Facilities

and System Deliverability Upgrades for which the Connecting Transmission Owner has assumed

responsibility to design, procure, and construct. The foregoing payments will be made by the

Connecting Transmission Owner to the Developer as just compensation for the damages caused

to the Developer, which actual damages are uncertain and impossible to determine at this time,

and as reasonable liquidated damages, but not as a penalty or a method to secure performance of

this Agreement. Liquidated damages, when the Developer and Connecting Transmission Owner

agree to them, are the exclusive remedy for the Connecting Transmission Owner’s failure to

meet its schedule.

Further, Connecting Transmission Owner shall not pay liquidated damages to Developer

if: (1) Developer is not ready to commence use of the Connecting Transmission Owner’s

Attachment Facilities or System Upgrade Facilities or System Deliverability Upgrades to take

the delivery of power for the Developer’s Large Generating Facility’s Trial Operation or to

export power from the Developer’s Large Generating Facility on the specified dates, unless the

SERVICE AGREEMENT NO. 1668

Developer would have been able to commence use of the Connecting Transmission Owner’s

Attachment Facilities or System Upgrade Facilities or System Deliverability Upgrades to take

the delivery of power for Developer’s Large Generating Facility’s Trial Operation or to export

power from the Developer’s Large Generating Facility, but for Connecting Transmission

Owner’s delay; (2) the Connecting Transmission Owner’s failure to meet the specified dates is

the result of the action or inaction of the Developer or any other Developer who has entered into

a Standard Large Generator Interconnection Agreement with the Connecting Transmission

Owner and NYISO, or action or inaction by any other Party, or any other cause beyond

Connecting Transmission Owner’s reasonable control or reasonable ability to cure; (3) the

Developer has assumed responsibility for the design, procurement and construction of the

Connecting Transmission Owner’s Attachment Facilities and Stand Alone System Upgrade

Facilities; or (4) the Connecting Transmission Owner and Developer have otherwise agreed. In

no event shall NYISO have any liability whatever to Developer for liquidated damages

associated with the engineering, procurement or construction of Attachment Facilities or System

Upgrade Facilities or System Deliverability Upgrades.

5.4 Power System Stabilizers.

The Developer shall procure, install, maintain and operate Power System Stabilizers in

accordance with the requirements identified in the Interconnection Studies conducted for

Developer’s Large Generating Facility. NYISO and Connecting Transmission Owner reserve

the right to reasonably establish minimum acceptable settings for any installed Power System

Stabilizers, subject to the design and operating limitations of the Large Generating Facility. If

the Large Generating Facility’s Power System Stabilizers are removed from service or not

capable of automatic operation, the Developer shall immediately notify the Connecting

Transmission Owner and NYISO. The requirements of this paragraph shall not apply to wind

generators.

5.5 Equipment Procurement.

If responsibility for construction of the Connecting Transmission Owner’s Attachment

Facilities or System Upgrade Facilities or System Deliverability Upgrades is to be borne by the

Connecting Transmission Owner, then the Connecting Transmission Owner shall commence

design of the Connecting Transmission Owner’s Attachment Facilities or System Upgrade

Facilities or System Deliverability Upgrades and procure necessary equipment as soon as

practicable after all of the following conditions are satisfied, unless the Developer and

Connecting Transmission Owner otherwise agree in writing:

5.5.1 NYISO and Connecting Transmission Owner have completed the

Interconnection Facilities Study pursuant to the Interconnection Facilities Study Agreement;

5.5.2 The NYISO has completed the required cost allocation analyses, and

Developer has accepted his share of the costs for necessary System Upgrade Facilities and

System Deliverability Upgrades in accordance with the provisions of Attachment S of the ISO

OATT;

SERVICE AGREEMENT NO. 1668

5.5.3 The Connecting Transmission Owner has received written authorization to

proceed with design and procurement from the Developer by the date specified in Appendix B

hereto; and

5.5.4 The Developer has provided security to the Connecting Transmission Owner

in accordance with Article 11.5 by the dates specified in Appendix B hereto.

5.6 Construction Commencement.

The Connecting Transmission Owner shall commence construction of the Connecting

Transmission Owner’s Attachment Facilities and System Upgrade Facilities and System

Deliverability Upgrades for which it is responsible as soon as practicable after the following

additional conditions are satisfied:

5.6.1 Approval of the appropriate Governmental Authority has been obtained for

any facilities requiring regulatory approval;

5.6.2 Necessary real property rights and rights-of-way have been obtained, to the

extent required for the construction of a discrete aspect of the Connecting Transmission Owner’s

Attachment Facilities and System Upgrade Facilities and System Deliverability Upgrades;

5.6.3 The Connecting Transmission Owner has received written authorization to

proceed with construction from the Developer by the date specified in Appendix B hereto; and

5.6.4 The Developer has provided security to the Connecting Transmission Owner

in accordance with Article 11.5 by the dates specified in Appendix B hereto.

5.7 Work Progress.

The Developer and Connecting Transmission Owner will keep each other, and NYISO,

advised periodically as to the progress of their respective design, procurement and construction

efforts. Any Party may, at any time, request a progress report from the Developer or Connecting

Transmission Owner. If, at any time, the Developer determines that the completion of the

Connecting Transmission Owner’s Attachment Facilities will not be required until after the

specified In-Service Date, the Developer will provide written notice to the Connecting

Transmission Owner and NYISO of such later date upon which the completion of the

Connecting Transmission Owner’s Attachment Facilities will be required.

5.8 Information Exchange.

As soon as reasonably practicable after the Effective Date, the Developer and Connecting

Transmission Owner shall exchange information, and provide NYISO the same information,

regarding the design and compatibility of their respective Attachment Facilities and

compatibility of the Attachment Facilities with the New York State Transmission System, and

shall work diligently and in good faith to make any necessary design changes.

SERVICE AGREEMENT NO. 1668

5.9 Limited Operation.

If any of the Connecting Transmission Owner’s Attachment Facilities or System Upgrade

Facilities or System Deliverability Upgrades are not reasonably expected to be completed prior

to the Commercial Operation Date of the Developer’s Large Generating Facility, NYISO shall,

upon the request and at the expense of Developer, in conjunction with the Connecting

Transmission Owner, perform operating studies on a timely basis to determine the extent to

which the Developer’s Large Generating Facility and the Developer’s Attachment Facilities may

operate prior to the completion of the Connecting Transmission Owner’s Attachment Facilities

or System Upgrade Facilities or System Deliverability Upgrades consistent with Applicable

Laws and Regulations, Applicable Reliability Standards, Good Utility Practice, and this

Agreement. Connecting Transmission Owner and NYISO shall permit Developer to operate the

Developer’s Large Generating Facility and the Developer’s Attachment Facilities in accordance

with the results of such studies.

5.10 Developer’s Attachment Facilities (“DAF”).

Developer shall, at its expense, design, procure, construct, own and install the DAF, as

set forth in Appendix A hereto.

5.10.1 DAF Specifications.

Developer shall submit initial specifications for the DAF, including System Protection

Facilities, to Connecting Transmission Owner and NYISO at least one hundred eighty (180)

Calendar Days prior to the Initial Synchronization Date; and final specifications for review and

comment at least ninety (90) Calendar Days prior to the Initial Synchronization Date.

Connecting Transmission Owner and NYISO shall review such specifications to ensure that the

DAF are compatible with the technical specifications, operational control, and safety

requirements of the Connecting Transmission Owner and NYISO and comment on such

specifications within thirty (30) Calendar Days of Developer’s submission. All specifications

provided hereunder shall be deemed to be Confidential Information.

5.10.2 No Warranty.

The review of Developer’s final specifications by Connecting Transmission Owner and

NYISO shall not be construed as confirming, endorsing, or providing a warranty as to the design,

fitness, safety, durability or reliability of the Large Generating Facility, or the DAF. Developer

shall make such changes to the DAF as may reasonably be required by Connecting Transmission

Owner or NYISO, in accordance with Good Utility Practice, to ensure that the DAF are

compatible with the technical specifications, operational control, and safety requirements of the

Connecting Transmission Owner and NYISO.

5.10.3 DAF Construction.

The DAF shall be designed and constructed in accordance with Good Utility Practice.

Within one hundred twenty (120) Calendar Days after the Commercial Operation Date, unless

the Developer and Connecting Transmission Owner agree on another mutually acceptable

deadline, the Developer shall deliver to the Connecting Transmission Owner and NYISO “as-

SERVICE AGREEMENT NO. 1668

built” drawings, information and documents for the DAF, such as: a one-line diagram, a site plan

showing the Large Generating Facility and the DAF, plan and elevation drawings showing the

layout of the DAF, a relay functional diagram, relaying AC and DC schematic wiring diagrams

and relay settings for all facilities associated with the Developer’s step-up transformers, the

facilities connecting the Large Generating Facility to the step-up transformers and the DAF, and

the impedances (determined by factory tests) for the associated step-up transformers and the

Large Generating Facility. The Developer shall provide to, and coordinate with, Connecting

Transmission Owner and NYISO with respect to proposed specifications for the excitation

system, automatic voltage regulator, Large Generating Facility control and protection settings,

transformer tap settings, and communications, if applicable.

5.11 Connecting Transmission Owner’s Attachment Facilities Construction.

The Connecting Transmission Owner’s Attachment Facilities shall be designed and

constructed in accordance with Good Utility Practice. Upon request, within one hundred twenty

(120) Calendar Days after the Commercial Operation Date, unless the Connecting Transmission

Owner and Developer agree on another mutually acceptable deadline, the Connecting

Transmission Owner shall deliver to the Developer “as-built” drawings, relay diagrams,

information and documents for the Connecting Transmission Owner’s Attachment Facilities set

forth in Appendix A.

The Connecting Transmission Owner Attachment Facilities and Stand Alone System

Upgrade Facilities shall be treated as Transmission Facilities Requiring ISO Notification.

5.12 Access Rights.

Upon reasonable notice and supervision by the Granting Party, and subject to any

required or necessary regulatory approvals, either the Connecting Transmission Owner or

Developer (“Granting Party”) shall furnish to the other of those two Parties (“Access Party”) at

no cost any rights of use, licenses, rights of way and easements with respect to lands owned or

controlled by the Granting Party, its agents (if allowed under the applicable agency agreement),

or any Affiliate, that are necessary to enable the Access Party to obtain ingress and egress at the

Point of Interconnection to construct, operate, maintain, repair, test (or witness testing), inspect,

replace or remove facilities and equipment to: (i) interconnect the Large Generating Facility with

the New York State Transmission System; (ii) operate and maintain the Large Generating

Facility, the Attachment Facilities and the New York State Transmission System; and (iii)

disconnect or remove the Access Party’s facilities and equipment upon termination of this

Agreement. In exercising such licenses, rights of way and easements, the Access Party shall not

unreasonably disrupt or interfere with normal operation of the Granting Party’s business and

shall adhere to the safety rules and procedures established in advance, as may be changed from

time to time, by the Granting Party and provided to the Access Party. The Access Party shall

indemnify the Granting Party against all claims of injury or damage from third parties resulting

from the exercise of the access rights provided for herein.

SERVICE AGREEMENT NO. 1668

5.13 Lands of Other Property Owners.

If any part of the Connecting Transmission Owner’s Attachment Facilities and/or System

Upgrade Facilities and/or System Deliverability Upgrades is to be installed on property owned

by persons other than Developer or Connecting Transmission Owner, the Connecting

Transmission Owner shall at Developer’s expense use efforts, similar in nature and extent to

those that it typically undertakes for its own or affiliated generation, including use of its eminent

domain authority, and to the extent consistent with state law, to procure from such persons any

rights of use, licenses, rights of way and easements that are necessary to construct, operate,

maintain, test, inspect, replace or remove the Connecting Transmission Owner’s Attachment

Facilities and/or System Upgrade Facilities and/or System Deliverability Upgrades upon such

property.

5.14 Permits.

NYISO, Connecting Transmission Owner and the Developer shall cooperate with each

other in good faith in obtaining all permits, licenses and authorizations that are necessary to

accomplish the interconnection in compliance with Applicable Laws and Regulations. With

respect to this paragraph, Connecting Transmission Owner shall provide permitting assistance to

the Developer comparable to that provided to the Connecting Transmission Owner’s own, or an

Affiliate’s generation, if any.

5.15 Early Construction of Base Case Facilities.

Developer may request Connecting Transmission Owner to construct, and Connecting

Transmission Owner shall construct, subject to a binding cost allocation agreement reached in

accordance with Attachment S to the ISO OATT, including Section 25.8.7 thereof, using

Reasonable Efforts to accommodate Developer’s In-Service Date, all or any portion of any

System Upgrade Facilities or System Deliverability Upgrades required for Developer to be

interconnected to the New York State Transmission System which are included in the Base Case

of the Class Year Interconnection Facilities Study for the Developer, and which also are required

to be constructed for another Developer, but where such construction is not scheduled to be

completed in time to achieve Developer’s In-Service Date.

5.16 Suspension.

Developer reserves the right, upon written notice to Connecting Transmission Owner and

NYISO, to suspend at any time all work by Connecting Transmission Owner associated with the

construction and installation of Connecting Transmission Owner’s Attachment Facilities and/or

System Upgrade Facilities and/or System Deliverability Upgrades required for only that

Developer under this Agreement with the condition that the New York State Transmission

System shall be left in a safe and reliable condition in accordance with Good Utility Practice and

the safety and reliability criteria of Connecting Transmission Owner and NYISO. In such event,

Developer shall be responsible for all reasonable and necessary costs and/or obligations in

accordance with Attachment S to the ISO OATT including those which Connecting

Transmission Owner (i) has incurred pursuant to this Agreement prior to the suspension and (ii)

incurs in suspending such work, including any costs incurred to perform such work as may be

SERVICE AGREEMENT NO. 1668

necessary to ensure the safety of persons and property and the integrity of the New York State

Transmission System during such suspension and, if applicable, any costs incurred in connection

with the cancellation or suspension of material, equipment and labor contracts which Connecting

Transmission Owner cannot reasonably avoid; provided, however, that prior to canceling or

suspending any such material, equipment or labor contract, Connecting Transmission Owner

shall obtain Developer’s authorization to do so.

Connecting Transmission Owner shall invoice Developer for such costs pursuant to

Article 12 and shall use due diligence to minimize its costs. In the event Developer suspends

work by Connecting Transmission Owner required under this Agreement pursuant to this Article

5.16, and has not requested Connecting Transmission Owner to recommence the work required

under this Agreement on or before the expiration of three (3) years following commencement of

such suspension, this Agreement shall be deemed terminated. The three-year period shall begin

on the date the suspension is requested, or the date of the written notice to Connecting

Transmission Owner and NYISO, if no effective date is specified.

5.17 Taxes.

5.17.1 Developer Payments Not Taxable.

The Developer and Connecting Transmission Owner intend that all payments or property

transfers made by Developer to Connecting Transmission Owner for the installation of the

Connecting Transmission Owner’s Attachment Facilities and the System Upgrade Facilities and

the System Deliverability Upgrades shall be non-taxable, either as contributions to capital, or as

an advance, in accordance with the Internal Revenue Code and any applicable state income tax

laws and shall not be taxable as contributions in aid of construction or otherwise under the

Internal Revenue Code and any applicable state income tax laws.

5.17.2 Representations and Covenants.

In accordance with IRS Notice 2001-82 and IRS Notice 88-129, Developer represents

and covenants that (i) ownership of the electricity generated at the Large Generating Facility will

pass to another party prior to the transmission of the electricity on the New York State

Transmission System, (ii) for income tax purposes, the amount of any payments and the cost of

any property transferred to the Connecting Transmission Owner for the Connecting

Transmission Owner’s Attachment Facilities will be capitalized by Developer as an intangible

asset and recovered using the straight-line method over a useful life of twenty (20) years, and

(iii) any portion of the Connecting Transmission Owner’s Attachment Facilities that is a “dual-

use intertie,” within the meaning of IRS Notice 88-129, is reasonably expected to carry only a de

minimis amount of electricity in the direction of the Large Generating Facility. For this purpose,

“de minimis amount” means no more than 5 percent of the total power flows in both directions,

calculated in accordance with the “5 percent test” set forth in IRS Notice 88-129. This is not

intended to be an exclusive list of the relevant conditions that must be met to conform to IRS

requirements for non-taxable treatment.

At Connecting Transmission Owner’s request, Developer shall provide Connecting

Transmission Owner with a report from an independent engineer confirming its representation in

SERVICE AGREEMENT NO. 1668

clause (iii), above. Connecting Transmission Owner represents and covenants that the cost of the

Connecting Transmission Owner’s Attachment Facilities paid for by Developer will have no net

effect on the base upon which rates are determined.

5.17.3 Indemnification for the Cost Consequences of Current Tax Liability

Imposed Upon the Connecting Transmission Owner.

Notwithstanding Article 5.17.1, Developer shall protect, indemnify and hold harmless

Connecting Transmission Owner from the cost consequences of any current tax liability imposed

against Connecting Transmission Owner as the result of payments or property transfers made by

Developer to Connecting Transmission Owner under this Agreement, as well as any interest and

penalties, other than interest and penalties attributable to any delay caused by Connecting

Transmission Owner.

Connecting Transmission Owner shall not include a gross-up for the cost consequences

of any current tax liability in the amounts it charges Developer under this Agreement unless (i)

Connecting Transmission Owner has determined, in good faith, that the payments or property

transfers made by Developer to Connecting Transmission Owner should be reported as income

subject to taxation or (ii) any Governmental Authority directs Connecting Transmission Owner

to report payments or property as income subject to taxation; provided, however, that Connecting

Transmission Owner may require Developer to provide security, in a form reasonably acceptable

to Connecting Transmission Owner (such as a parental guarantee or a letter of credit), in an

amount equal to the cost consequences of any current tax liability under this Article 5.17.

Developer shall reimburse Connecting Transmission Owner for such costs on a fully grossed-up

basis, in accordance with Article 5.17.4, within thirty (30) Calendar Days of receiving written

notification from Connecting Transmission Owner of the amount due, including detail about how

the amount was calculated.

This indemnification obligation shall terminate at the earlier of (1) the expiration of the

ten-year testing period and the applicable statute of limitation, as it may be extended by the

Connecting Transmission Owner upon request of the IRS, to keep these years open for audit or

adjustment, or (2) the occurrence of a subsequent taxable event and the payment of any related

indemnification obligations as contemplated by this Article 5.17.

5.17.4 Tax Gross-Up Amount.

Developer’s liability for the cost consequences of any current tax liability under this

Article 5.17 shall be calculated on a fully grossed-up basis. Except as may otherwise be agreed

to by the parties, this means that Developer will pay Connecting Transmission Owner, in

addition to the amount paid for the Attachment Facilities and System Upgrade Facilities and

System Deliverability Upgrades, an amount equal to (1) the current taxes imposed on Connecting

Transmission Owner (“Current Taxes”) on the excess of (a) the gross income realized by

Connecting Transmission Owner as a result of payments or property transfers made by

Developer to Connecting Transmission Owner under this Agreement (without regard to any

payments under this Article 5.17) (the “Gross Income Amount”) over (b) the present value of

future tax deductions for depreciation that will be available as a result of such payments or

property transfers (the “Present Value Depreciation Amount”), plus (2) an additional amount

SERVICE AGREEMENT NO. 1668

sufficient to permit the Connecting Transmission Owner to receive and retain, after the payment

of all Current Taxes, an amount equal to the net amount described in clause (1).

For this purpose, (i) Current Taxes shall be computed based on Connecting Transmission

Owner’s composite federal and state tax rates at the time the payments or property transfers are

received and Connecting Transmission Owner will be treated as being subject to tax at the

highest marginal rates in effect at that time (the “Current Tax Rate”), and (ii) the Present Value

Depreciation Amount shall be computed by discounting Connecting Transmission Owner’s

anticipated tax depreciation deductions as a result of such payments or property transfers by

Connecting Transmission Owner’s current weighted average cost of capital. Thus, the formula

for calculating Developer’s liability to Connecting Transmission Owner pursuant to this Article

5.17.4 can be expressed as follows: (Current Tax Rate x (Gross Income Amount - Present Value

Depreciation Amount))/(1 - Current Tax Rate). Developer’s estimated tax liability in the event

taxes are imposed shall be stated in Appendix A, Attachment Facilities and System Upgrade

Facilities and System Deliverability Upgrades.

5.17.5 Private Letter Ruling or Change or Clarification of Law.

At Developer’s request and expense, Connecting Transmission Owner shall file with the

IRS a request for a private letter ruling as to whether any property transferred or sums paid, or to

be paid, by Developer to Connecting Transmission Owner under this Agreement are subject to

federal income taxation. Developer will prepare the initial draft of the request for a private letter

ruling, and will certify under penalties of perjury that all facts represented in such request are

true and accurate to the best of Developer’s knowledge. Connecting Transmission Owner and

Developer shall cooperate in good faith with respect to the submission of such request.

Connecting Transmission Owner shall keep Developer fully informed of the status of

such request for a private letter ruling and shall execute either a privacy act waiver or a limited

power of attorney, in a form acceptable to the IRS, that authorizes Developer to participate in all

discussions with the IRS regarding such request for a private letter ruling. Connecting

Transmission Owner shall allow Developer to attend all meetings with IRS officials about the

request and shall permit Developer to prepare the initial drafts of any follow-up letters in

connection with the request.

5.17.6 Subsequent Taxable Events.

If, within 10 years from the date on which the relevant Connecting Transmission Owner

Attachment Facilities are placed in service, (i) Developer Breaches the covenants contained in

Article 5.17.2, (ii) a “disqualification event” occurs within the meaning of IRS Notice 88-129, or

(iii) this Agreement terminates and Connecting Transmission Owner retains ownership of the

Attachment Facilities and System Upgrade Facilities and System Deliverability Upgrades, the

Developer shall pay a tax gross-up for the cost consequences of any current tax liability imposed

on Connecting Transmission Owner, calculated using the methodology described in Article

5.17.4 and in accordance with IRS Notice 90-60.

SERVICE AGREEMENT NO. 1668

5.17.7 Contests.

In the event any Governmental Authority determines that Connecting Transmission

Owner’s receipt of payments or property constitutes income that is subject to taxation,

Connecting Transmission Owner shall notify Developer, in writing, within thirty (30) Calendar

Days of receiving notification of such determination by a Governmental Authority. Upon the

timely written request by Developer and at Developer’s sole expense, Connecting Transmission

Owner may appeal, protest, seek abatement of, or otherwise oppose such determination. Upon

Developer’s written request and sole expense, Connecting Transmission Owner may file a claim

for refund with respect to any taxes paid under this Article 5.17, whether or not it has received

such a determination. Connecting Transmission Owner reserves the right to make all decisions

with regard to the prosecution of such appeal, protest, abatement or other contest, including the

selection of counsel and compromise or settlement of the claim, but Connecting Transmission

Owner shall keep Developer informed, shall consider in good faith suggestions from Developer

about the conduct of the contest, and shall reasonably permit Developer or an Developer

representative to attend contest proceedings.

Developer shall pay to Connecting Transmission Owner on a periodic basis, as invoiced

by Connecting Transmission Owner, Connecting Transmission Owner’s documented reasonable

costs of prosecuting such appeal, protest, abatement or other contest, including any costs

associated with obtaining the opinion of independent tax counsel described in this Article 5.17.7.

The Connecting Transmission Owner may abandon any contest if the Developer fails to provide

payment to the Connecting Transmission Owner within thirty (30) Calendar Days of receiving

such invoice. At any time during the contest, Connecting Transmission Owner may agree to a

settlement either with Developer’s consent or after obtaining written advice from nationally-

recognized tax counsel, selected by Connecting Transmission Owner, but reasonably acceptable

to Developer, that the proposed settlement represents a reasonable settlement given the hazards

of litigation. Developer’s obligation shall be based on the amount of the settlement agreed to by

Developer, or if a higher amount, so much of the settlement that is supported by the written

advice from nationally-recognized tax counsel selected under the terms of the preceding

sentence. The settlement amount shall be calculated on a fully grossed-up basis to cover any

related cost consequences of the current tax liability. The Connecting Transmission Owner may

also settle any tax controversy without receiving the Developer’s consent or any such written

advice; however, any such settlement will relieve the Developer from any obligation to

indemnify Connecting Transmission Owner for the tax at issue in the contest (unless the failure

to obtain written advice is attributable to the Developer’s unreasonable refusal to the

appointment of independent tax counsel).

5.17.8 Refund.

In the event that (a) a private letter ruling is issued to Connecting Transmission Owner

which holds that any amount paid or the value of any property transferred by Developer to

Connecting Transmission Owner under the terms of this Agreement is not subject to federal

income taxation, (b) any legislative change or administrative announcement, notice, ruling or

other determination makes it reasonably clear to Connecting Transmission Owner in good faith

that any amount paid or the value of any property transferred by Developer to Connecting

Transmission Owner under the terms of this Agreement is not taxable to Connecting

SERVICE AGREEMENT NO. 1668

Transmission Owner, (c) any abatement, appeal, protest, or other contest results in a

determination that any payments or transfers made by Developer to Connecting Transmission

Owner are not subject to federal income tax, or (d) if Connecting Transmission Owner receives a

refund from any taxing authority for any overpayment of tax attributable to any payment or

property transfer made by Developer to Connecting Transmission Owner pursuant to this

Agreement, Connecting Transmission Owner shall promptly refund to Developer the following:

(i) Any payment made by Developer under this Article 5.17 for taxes that is

attributable to the amount determined to be non-taxable, together with interest thereon,

(ii) Interest on any amounts paid by Developer to Connecting Transmission Owner

for such taxes which Connecting Transmission Owner did not submit to the taxing authority,

calculated in accordance with the methodology set forth in FERC’s regulations at 18 C.F.R.

§35.19a(a)(2)(iii) from the date payment was made by Developer to the date Connecting

Transmission Owner refunds such payment to Developer, and

(iii) With respect to any such taxes paid by Connecting Transmission Owner, any

refund or credit Connecting Transmission Owner receives or to which it may be entitled from

any Governmental Authority, interest (or that portion thereof attributable to the payment

described in clause (i), above) owed to the Connecting Transmission Owner for such

overpayment of taxes (including any reduction in interest otherwise payable by Connecting

Transmission Owner to any Governmental Authority resulting from an offset or credit);

provided, however, that Connecting Transmission Owner will remit such amount promptly to

Developer only after and to the extent that Connecting Transmission Owner has received a tax

refund, credit or offset from any Governmental Authority for any applicable overpayment of

income tax related to the Connecting Transmission Owner’s Attachment Facilities.

The intent of this provision is to leave both the Developer and Connecting Transmission

Owner, to the extent practicable, in the event that no taxes are due with respect to any payment

for Attachment Facilities and System Upgrade Facilities and System Deliverability Upgrades

hereunder, in the same position they would have been in had no such tax payments been made.

5.17.9 Taxes Other Than Income Taxes.

Upon the timely request by Developer, and at Developer’s sole expense, Connecting

Transmission Owner shall appeal, protest, seek abatement of, or otherwise contest any tax (other

than federal or state income tax) asserted or assessed against Connecting Transmission Owner

for which Developer may be required to reimburse Connecting Transmission Owner under the

terms of this Agreement. Developer shall pay to Connecting Transmission Owner on a periodic

basis, as invoiced by Connecting Transmission Owner, Connecting Transmission Owner’s

documented reasonable costs of prosecuting such appeal, protest, abatement, or other contest.

Developer and Connecting Transmission Owner shall cooperate in good faith with respect to any

such contest. Unless the payment of such taxes is a prerequisite to an appeal or abatement or

cannot be deferred, no amount shall be payable by Developer to Connecting Transmission

Owner for such taxes until they are assessed by a final, non-appealable order by any court or

agency of competent jurisdiction. In the event that a tax payment is withheld and ultimately due

SERVICE AGREEMENT NO. 1668

and payable after appeal, Developer will be responsible for all taxes, interest and penalties, other

than penalties attributable to any delay caused by Connecting Transmission Owner.

5.18 Tax Status; Non-Jurisdictional Entities.

5.18.1 Tax Status.

Each Party shall cooperate with the other Parties to maintain the other Parties’ tax status.

Nothing in this Agreement is intended to adversely affect the tax status of any Party including

the status of NYISO, or the status of any Connecting Transmission Owner with respect to the

issuance of bonds including, but not limited to, Local Furnishing Bonds. Notwithstanding any

other provisions of this Agreement, LIPA, NYPA and Consolidated Edison Company of New

York, Inc. shall not be required to comply with any provisions of this Agreement that would

result in the loss of tax-exempt status of any of their Tax-Exempt Bonds or impair their ability to

issue future tax-exempt obligations. For purposes of this provision, Tax-Exempt Bonds shall

include the obligations of the Long Island Power Authority, NYPA and Consolidated Edison

Company of New York, Inc., the interest on which is not included in gross income under the

Internal Revenue Code.

5.18.2 Non-Jurisdictional Entities.

LIPA and NYPA do not waive their exemptions, pursuant to Section 201(f) of the FPA,

from Commission jurisdiction with respect to the Commission’s exercise of the FPA’s general

ratemaking authority.

5.19 Modification.

5.19.1 General.

Either the Developer or Connecting Transmission Owner may undertake modifications to

its facilities covered by this Agreement. If either the Developer or Connecting Transmission

Owner plans to undertake a modification that reasonably may be expected to affect the other

Party’s facilities, that Party shall provide to the other Party, and to NYISO, sufficient

information regarding such modification so that the other Party and NYISO may evaluate the

potential impact of such modification prior to commencement of the work. Such information

shall be deemed to be Confidential Information hereunder and shall include information

concerning the timing of such modifications and whether such modifications are expected to

interrupt the flow of electricity from the Large Generating Facility. The Party desiring to

perform such work shall provide the relevant drawings, plans, and specifications to the other

Party and NYISO at least ninety (90) Calendar Days in advance of the commencement of the

work or such shorter period upon which the Parties may agree, which agreement shall not

unreasonably be withheld, conditioned or delayed.

In the case of Large Generating Facility modifications that do not require Developer to

submit an Interconnection Request, the NYISO shall provide, within sixty (60) Calendar Days

(or such other time as the Parties may agree), an estimate of any additional modifications to the

New York State Transmission System, Connecting Transmission Owner’s Attachment Facilities

or System Upgrade Facilities or System Deliverability Upgrades necessitated by such Developer

SERVICE AGREEMENT NO. 1668

modification and a good faith estimate of the costs thereof. The Developer shall be responsible

for the cost of any such additional modifications, including the cost of studying the impact of the

Developer modification.

5.19.2 Standards.

Any additions, modifications, or replacements made to a Party’s facilities shall be

designed, constructed and operated in accordance with this Agreement, NYISO requirements and

Good Utility Practice.

5.19.3 Modification Costs.

Developer shall not be assigned the costs of any additions, modifications, or replacements

that Connecting Transmission Owner makes to the Connecting Transmission Owner’s

Attachment Facilities or the New York State Transmission System to facilitate the

interconnection of a third party to the Connecting Transmission Owner’s Attachment Facilities

or the New York State Transmission System, or to provide Transmission Service to a third party

under the ISO OATT, except in accordance with the cost allocation procedures in Attachment S

of the ISO OATT. Developer shall be responsible for the costs of any additions, modifications,

or replacements to the Developer’s Attachment Facilities that may be necessary to maintain or

upgrade such Developer’s Attachment Facilities consistent with Applicable Laws and

Regulations, Applicable Reliability Standards or Good Utility Practice.

ARTICLE 6. TESTING AND INSPECTION

6.1 Pre-Commercial Operation Date Testing and Modifications.

Prior to the Commercial Operation Date, the Connecting Transmission Owner shall test

the Connecting Transmission Owner’s Attachment Facilities and System Upgrade Facilities and

System Deliverability Upgrades and Developer shall test the Large Generating Facility and the

Developer Attachment Facilities to ensure their safe and reliable operation. Similar testing may

be required after initial operation. Developer and Connecting Transmission Owner shall each

make any modifications to its facilities that are found to be necessary as a result of such testing.

Developer shall bear the cost of all such testing and modifications. Developer shall generate test

energy at the Large Generating Facility only if it has arranged for the injection of such test

energy in accordance with NYISO procedures.

6.2 Post-Commercial Operation Date Testing and Modifications.

Developer and Connecting Transmission Owner shall each at its own expense perform

routine inspection and testing of its facilities and equipment in accordance with Good Utility

Practice and Applicable Reliability Standards as may be necessary to ensure the continued

interconnection of the Large Generating Facility with the New York State Transmission System

in a safe and reliable manner. Developer and Connecting Transmission Owner shall each have

the right, upon advance written notice, to require reasonable additional testing of the other

Party’s facilities, at the requesting Party’s expense, as may be in accordance with Good Utility

Practice.

SERVICE AGREEMENT NO. 1668

6.3 Right to Observe Testing.

Developer and Connecting Transmission Owner shall each notify the other Party, and the

NYISO, in advance of its performance of tests of its Attachment Facilities. The other Party, and

the NYISO, shall each have the right, at its own expense, to observe such testing.

6.4 Right to Inspect.

Developer and Connecting Transmission Owner shall each have the right, but shall have

no obligation to: (i) observe the other Party’s tests and/or inspection of any of its System

Protection Facilities and other protective equipment, including Power System Stabilizers; (ii)

review the settings of the other Party’s System Protection Facilities and other protective

equipment; and (iii) review the other Party’s maintenance records relative to the Attachment

Facilities, the System Protection Facilities and other protective equipment. NYISO shall have

these same rights of inspection as to the facilities and equipment of Developer and Connecting

Transmission Owner. A Party may exercise these rights from time to time as it deems necessary

upon reasonable notice to the other Party. The exercise or non-exercise by a Party of any such

rights shall not be construed as an endorsement or confirmation of any element or condition of

the Attachment Facilities or the System Protection Facilities or other protective equipment or the

operation thereof, or as a warranty as to the fitness, safety, desirability, or reliability of same.

Any information that a Party obtains through the exercise of any of its rights under this Article

6.4 shall be treated in accordance with Article 22 of this Agreement and Attachment F to the ISO

OATT.

ARTICLE 7. METERING

7.1 General.

Developer and Connecting Transmission Owner shall each comply with applicable

requirements of NYISO and the New York Public Service Commission when exercising its

rights and fulfilling its responsibilities under this Article 7. Unless otherwise agreed by the

Connecting Transmission Owner and NYISO approved meter service provider and Developer,

the Connecting Transmission Owner shall install Metering Equipment at the Point of

Interconnection prior to any operation of the Large Generating Facility and shall own, operate,

test and maintain such Metering Equipment. Net power flows including MW and MVAR,

MWHR and loss profile data to and from the Large Generating Facility shall be measured at the

Point of Interconnection. Connecting Transmission Owner shall provide metering quantities, in

analog and/or digital form, as required, to Developer or NYISO upon request. Where the Point

of Interconnection for the Large Generating Facility is other than the generator terminal, the

Developer shall also provide gross MW and MVAR quantities at the generator terminal.

Developer shall bear all reasonable documented costs associated with the purchase, installation,

operation, testing and maintenance of the Metering Equipment.

7.2 Check Meters.

Developer, at its option and expense, may install and operate, on its premises and on its

side of the Point of Interconnection, one or more check meters to check Connecting

Transmission Owner’s meters. Such check meters shall be for check purposes only and shall not

SERVICE AGREEMENT NO. 1668

be used for the measurement of power flows for purposes of this Agreement, except as provided

in Article 7.4 below. The check meters shall be subject at all reasonable times to inspection and

examination by Connecting Transmission Owner or its designee. The installation, operation and

maintenance thereof shall be performed entirely by Developer in accordance with Good Utility

Practice.

7.3 Standards.

Connecting Transmission Owner shall install, calibrate, and test revenue quality Metering

Equipment including potential transformers and current transformers in accordance with

applicable ANSI and PSC standards as detailed in the NYISO Control Center Communications

Manual and in the NYISO Revenue Metering Requirements Manual.

7.4 Testing of Metering Equipment.

Connecting Transmission Owner shall inspect and test all of its Metering Equipment

upon installation and at least once every two (2) years thereafter. If requested to do so by

NYISO or Developer, Connecting Transmission Owner shall, at Developer’s expense, inspect or

test Metering Equipment more frequently than every two (2) years. Connecting Transmission

Owner shall give reasonable notice of the time when any inspection or test shall take place, and

Developer and NYISO may have representatives present at the test or inspection. If at any time

Metering Equipment is found to be inaccurate or defective, it shall be adjusted, repaired or

replaced at Developer’s expense, in order to provide accurate metering, unless the inaccuracy or

defect is due to Connecting Transmission Owner’s failure to maintain, then Connecting

Transmission Owner shall pay. If Metering Equipment fails to register, or if the measurement

made by Metering Equipment during a test varies by more than two percent from the

measurement made by the standard meter used in the test, Connecting Transmission Owner shall

adjust the measurements by correcting all measurements for the period during which Metering

Equipment was in error by using Developer’s check meters, if installed. If no such check meters

are installed or if the period cannot be reasonably ascertained, the adjustment shall be for the

period immediately preceding the test of the Metering Equipment equal to one-half the time from

the date of the last previous test of the Metering Equipment. The NYISO shall reserve the right

to review all associated metering equipment installation on the Developer’s or Connecting

Transmission Owner’s property at any time.

7.5 Metering Data.

At Developer’s expense, the metered data shall be telemetered to one or more locations

designated by Connecting Transmission Owner, Developer and NYISO. Such telemetered data

shall be used, under normal operating conditions, as the official measurement of the amount of

energy delivered from the Large Generating Facility to the Point of Interconnection.

ARTICLE 8. COMMUNICATIONS

8.1 Developer Obligations.

In accordance with applicable NYISO requirements, Developer shall maintain

satisfactory operating communications with Connecting Transmission Owner and NYISO.

SERVICE AGREEMENT NO. 1668

Developer shall provide standard voice line, dedicated voice line and facsimile communications

at its Large Generating Facility control room or central dispatch facility through use of either the

public telephone system, or a voice communications system that does not rely on the public

telephone system. Developer shall also provide the dedicated data circuit(s) necessary to provide

Developer data to Connecting Transmission Owner and NYISO as set forth in Appendix D

hereto. The data circuit(s) shall extend from the Large Generating Facility to the location(s)

specified by Connecting Transmission Owner and NYISO. Any required maintenance of such

communications equipment shall be performed by Developer. Operational communications shall

be activated and maintained under, but not be limited to, the following events: system paralleling

or separation, scheduled and unscheduled shutdowns, equipment clearances, and hourly and

daily load data.

8.2 Remote Terminal Unit.

Prior to the Initial Synchronization Date of the Large Generating Facility, a Remote

Terminal Unit, or equivalent data collection and transfer equipment acceptable to the Parties,

shall be installed by Developer, or by Connecting Transmission Owner at Developer’s expense,

to gather accumulated and instantaneous data to be telemetered to the location(s) designated by

Connecting Transmission Owner and NYISO through use of a dedicated point-to-point data

circuit(s) as indicated in Article 8.1. The communication protocol for the data circuit(s) shall be

specified by Connecting Transmission Owner and NYISO. Instantaneous bi-directional analog

real power and reactive power flow information must be telemetered directly to the location(s)

specified by Connecting Transmission Owner and NYISO.

Each Party will promptly advise the appropriate other Party if it detects or otherwise

learns of any metering, telemetry or communications equipment errors or malfunctions that

require the attention and/or correction by that other Party. The Party owning such equipment

shall correct such error or malfunction as soon as reasonably feasible.

8.3 No Annexation.

Any and all equipment placed on the premises of a Party shall be and remain the property

of the Party providing such equipment regardless of the mode and manner of annexation or

attachment to real property, unless otherwise mutually agreed by the Party providing such

equipment and the Party receiving such equipment.

ARTICLE 9. OPERATIONS

9.1 General.

Each Party shall comply with Applicable Laws and Regulations and Applicable

Reliability Standards. Each Party shall provide to the other Parties all information that may

reasonably be required by the other Parties to comply with Applicable Laws and Regulations and

Applicable Reliability Standards.

SERVICE AGREEMENT NO. 1668

9.2 NYISO and Connecting Transmission Owner Obligations.

Connecting Transmission Owner and NYISO shall cause the New York State

Transmission System and the Connecting Transmission Owner’s Attachment Facilities to be

operated, maintained and controlled in a safe and reliable manner in accordance with this

Agreement and the NYISO Tariffs. Connecting Transmission Owner and NYISO may provide

operating instructions to Developer consistent with this Agreement, NYISO procedures and

Connecting Transmission Owner’s operating protocols and procedures as they may change from

time to time. Connecting Transmission Owner and NYISO will consider changes to their

respective operating protocols and procedures proposed by Developer.

9.3 Developer Obligations.

Developer shall at its own expense operate, maintain and control the Large Generating

Facility and the Developer’s Attachment Facilities in a safe and reliable manner and in

accordance with this Agreement. Developer shall operate the Large Generating Facility and the

Developer’s Attachment Facilities in accordance with NYISO and Connecting Transmission

Owner requirements, as such requirements are set forth or referenced in Appendix C hereto.

Appendix C will be modified to reflect changes to the requirements as they may change from

time to time. Any Party may request that the appropriate other Party or Parties provide copies of

the requirements set forth or referenced in Appendix C hereto.

9.4 Start-Up and Synchronization.

Consistent with the mutually acceptable procedures of the Developer and Connecting

Transmission Owner, the Developer is responsible for the proper synchronization of the Large

Generating Facility to the New York State Transmission System in accordance with NYISO and

Connecting Transmission Owner procedures and requirements.

9.5 Real and Reactive Power Control.

9.5.1 Power Factor Design Criteria.

9.5.1.1 Synchronous Generation. Developer shall design the Large

Generating Facility to maintain effective composite power delivery at continuous rated power

output at the Point of Interconnection at a power factor within the range set forth in Appendix C.

The Developer shall design and maintain the plant auxiliary systems to operate safely

throughout the entire real and reactive power design range as set forth in Appendix C.

9.5.1.2 Non-Synchronous Generation. Developer shall design the Large

Generating Facility to maintain composite power delivery at continuous rated power output at

the high-side of the generator substation at a power factor within the range of 0.95 leading to

0.95 lagging, unless the NYISO or the Transmission Owner in whose Transmission District the

Large Generating Facility interconnects has established a different power factor range that

applies to all non-synchronous generators in the Control Area or Transmission District (as

applicable) on a comparable basis, in accordance with Good Utility Practice. This power factor

range standard shall be dynamic and can be met using, for example, power electronics designed

SERVICE AGREEMENT NO. 1668

to supply this level of reactive capability (taking into account any limitations due to voltage

level, real power output, etc.) or fixed and switched capacitors, or a combination of the two.

This requirement shall only apply to newly interconnection non-synchronous generators that

have not yet executed a Facilities Study Agreement as of September 21, 2016.

The Developer shall design and maintain the plant auxiliary systems to operate safely

throughout the entire real and reactive power design range.

9.5.2 Voltage Schedules.

Once the Developer has synchronized the Large Generating Facility with the New York

State Transmission System, NYISO shall require Developer to operate the Large Generating

Facility to produce or absorb reactive power within the design capability of the Large Generating

Facility set forth in Article 9.5.1 (Power Factor Design Criteria) and in Appendix C. NYISO’s

voltage schedules shall treat all sources of reactive power in the New York Control Area in an

equitable and not unduly discriminatory manner. NYISO shall exercise Reasonable Efforts to

provide Developer with such schedules in accordance with NYISO procedures, and may make

changes to such schedules as necessary to maintain the reliability of the New York State

Transmission System. Developer shall operate the Large Generating Facility to maintain the

specified output voltage or power factor at the Point of Interconnection within the design

capability of the Large Generating Facility set forth in Article 9.5.1 (Power Factor Design

Criteria) and in Appendix C as directed by the Connecting Transmission Owner’s system

operator or the NYISO. If Developer is unable to maintain the specified voltage or power factor,

it shall promptly notify NYISO.

9.5.3 Payment for Reactive Power.

NYISO shall pay Developer for reactive power or voltage support service that Developer

provides from the Large Generating Facility in accordance with the provisions of Rate Schedule

2 of the NYISO Services Tariff.

9.5.4 Governors and Regulators.

Whenever the Large Generating Facility is operated in parallel with the New York State

Transmission System, the turbine speed governors and automatic voltage regulators shall be in

automatic operation at all times. If the Large Generating Facility’s speed governors or automatic

voltage regulators are not capable of such automatic operation, the Developer shall immediately

notify NYISO, or its designated representative, and ensure that such Large Generating Facility’s

real and reactive power are within the design capability of the Large Generating Facility’s

generating unit(s) and steady state stability limits and NYISO system operating (thermal, voltage

and transient stability) limits. Developer shall not cause its Large Generating Facility to

disconnect automatically or instantaneously from the New York State Transmission System or

trip any generating unit comprising the Large Generating Facility for an under or over frequency

condition unless the abnormal frequency condition persists for a time period beyond the limits

set forth in ANSI/IEEE Standard C37.106, or such other standard as applied to other generators

in the New York Control Area on a comparable basis.

SERVICE AGREEMENT NO. 1668

9.6 Outages and Interruptions.

9.6.1 Outages.

9.6.1.1 Outage Authority and Coordination. Developer and Connecting

Transmission Owner may each, in accordance with NYISO procedures and Good Utility Practice

and in coordination with the other Party, remove from service any of its respective Attachment

Facilities or System Upgrade Facilities and System Deliverability Upgrades that may impact the

other Party’s facilities as necessary to perform maintenance or testing or to install or replace

equipment. Absent an Emergency State, the Party scheduling a removal of such facility(ies)

from service will use Reasonable Efforts to schedule such removal on a date and time mutually

acceptable to both the Developer and the Connecting Transmission Owner. In all circumstances

either Party planning to remove such facility(ies) from service shall use Reasonable Efforts to

minimize the effect on the other Party of such removal.

9.6.1.2 Outage Schedules. The Connecting Transmission Owner shall post

scheduled outages of its transmission facilities on the NYISO OASIS. Developer shall submit its

planned maintenance schedules for the Large Generating Facility to Connecting Transmission

Owner and NYISO for a minimum of a rolling thirty-six month period. Developer shall update

its planned maintenance schedules as necessary. NYISO may direct, or the Connecting

Transmission Owner may request, Developer to reschedule its maintenance as necessary to

maintain the reliability of the New York State Transmission System. Compensation to

Developer for any additional direct costs that the Developer incurs as a result of rescheduling

maintenance, including any additional overtime, breaking of maintenance contracts or other costs

above and beyond the cost the Developer would have incurred absent the request to reschedule

maintenance, shall be in accordance with the ISO OATT. Developer will not be eligible to

receive compensation, if during the twelve (12) months prior to the date of the scheduled

maintenance, the Developer had modified its schedule of maintenance activities other than at the

direction of the NYISO or request of the Connecting Transmission Owner.

9.6.1.3 Outage Restoration. If an outage on the Attachment Facilities or

System Upgrade Facilities or System Deliverability Upgrades of the Connecting Transmission

Owner or Developer adversely affects the other Party’s operations or facilities, the Party that

owns the facility that is out of service shall use Reasonable Efforts to promptly restore such

facility(ies) to a normal operating condition consistent with the nature of the outage. The Party

that owns the facility that is out of service shall provide the other Party and NYISO, to the extent

such information is known, information on the nature of the Emergency State, an estimated time

of restoration, and any corrective actions required. Initial verbal notice shall be followed up as

soon as practicable with written notice explaining the nature of the outage.

9.6.2 Interruption of Service.

If required by Good Utility Practice or Applicable Reliability Standards to do so, the

NYISO or Connecting Transmission Owner may require Developer to interrupt or reduce

production of electricity if such production of electricity could adversely affect the ability of

NYISO and Connecting Transmission Owner to perform such activities as are necessary to

safely and reliably operate and maintain the New York State Transmission System. The

SERVICE AGREEMENT NO. 1668

following provisions shall apply to any interruption or reduction permitted under this Article

9.6.2:

9.6.2.1 The interruption or reduction shall continue only for so long as

reasonably necessary under Good Utility Practice;

9.6.2.2 Any such interruption or reduction shall be made on an equitable, non-

discriminatory basis with respect to all generating facilities directly connected to the New York

State Transmission System;

9.6.2.3 When the interruption or reduction must be made under circumstances

which do not allow for advance notice, NYISO or Connecting Transmission Owner shall notify

Developer by telephone as soon as practicable of the reasons for the curtailment, interruption, or

reduction, and, if known, its expected duration. Telephone notification shall be followed by

written notification as soon as practicable;

9.6.2.4 Except during the existence of an Emergency State, when the

interruption or reduction can be scheduled without advance notice, NYISO or Connecting

Transmission Owner shall notify Developer in advance regarding the timing of such scheduling

and further notify Developer of the expected duration. NYISO or Connecting Transmission

Owner shall coordinate with each other and the Developer using Good Utility Practice to

schedule the interruption or reduction during periods of least impact to the Developer, the

Connecting Transmission Owner and the New York State Transmission System;

9.6.2.5 The Parties shall cooperate and coordinate with each other to the

extent necessary in order to restore the Large Generating Facility, Attachment Facilities, and the

New York State Transmission System to their normal operating state, consistent with system

conditions and Good Utility Practice.

9.6.3 Under-Frequency and Over Frequency Conditions.

The New York State Transmission System is designed to automatically activate a load-

shed program as required by the NPCC in the event of an under-frequency system disturbance.

Developer shall implement under-frequency and over-frequency relay set points for the Large

Generating Facility as required by the NPCC to ensure “ride through” capability of the New

York State Transmission System. Large Generating Facility response to frequency deviations of

predetermined magnitudes, both under-frequency and over-frequency deviations, shall be studied

and coordinated with the NYISO and Connecting Transmission Owner in accordance with Good

Utility Practice. The term “ride through” as used herein shall mean the ability of a Generating

Facility to stay connected to and synchronized with the New York State Transmission System

during system disturbances within a range of under-frequency and over-frequency conditions, in

accordance with Good Utility Practice and with NPCC Regional Reliability Reference Directory

# 12, or its successor.

9.6.4 System Protection and Other Control Requirements.

9.6.4.1 System Protection Facilities. Developer shall, at its expense, install,

operate and maintain System Protection Facilities as a part of the Large Generating Facility or

SERVICE AGREEMENT NO. 1668

Developer’s Attachment Facilities. Connecting Transmission Owner shall install at Developer’s

expense any System Protection Facilities that may be required on the Connecting Transmission

Owner’s Attachment Facilities or the New York State Transmission System as a result of the

interconnection of the Large Generating Facility and Developer’s Attachment Facilities.

9.6.4.2 The protection facilities of both the Developer and Connecting

Transmission Owner shall be designed and coordinated with other systems in accordance with

Good Utility Practice and Applicable Reliability Standards.

9.6.4.3 The Developer and Connecting Transmission Owner shall each be

responsible for protection of its respective facilities consistent with Good Utility Practice and

Applicable Reliability Standards.

9.6.4.4 The protective relay design of the Developer and Connecting

Transmission Owner shall each incorporate the necessary test switches to perform the tests

required in Article 6 of this Agreement. The required test switches will be placed such that they

allow operation of lockout relays while preventing breaker failure schemes from operating and

causing unnecessary breaker operations and/or the tripping of the Developer’s Large Generating

Facility.

9.6.4.5 The Developer and Connecting Transmission Owner will each test,

operate and maintain System Protection Facilities in accordance with Good Utility Practice,

NERC and NPCC criteria.

9.6.4.6 Prior to the In-Service Date, and again prior to the Commercial

Operation Date, the Developer and Connecting Transmission Owner shall each perform, or their

agents shall perform, a complete calibration test and functional trip test of the System Protection

Facilities. At intervals suggested by Good Utility Practice and following any apparent

malfunction of the System Protection Facilities, the Developer and Connecting Transmission

Owner shall each perform both calibration and functional trip tests of its System Protection

Facilities. These tests do not require the tripping of any in-service generation unit. These tests

do, however, require that all protective relays and lockout contacts be activated.

9.6.5 Requirements for Protection.

In compliance with NPCC requirements and Good Utility Practice, Developer shall

provide, install, own, and maintain relays, circuit breakers and all other devices necessary to

remove any fault contribution of the Large Generating Facility to any short circuit occurring on

the New York State Transmission System not otherwise isolated by Connecting Transmission

Owner’s equipment, such that the removal of the fault contribution shall be coordinated with the

protective requirements of the New York State Transmission System. Such protective

equipment shall include, without limitation, a disconnecting device or switch with load-

interrupting capability located between the Large Generating Facility and the New York State

Transmission System at a site selected upon mutual agreement (not to be unreasonably withheld,

conditioned or delayed) of the Developer and Connecting Transmission Owner. Developer shall

be responsible for protection of the Large Generating Facility and Developer’s other equipment

from such conditions as negative sequence currents, over- or under-frequency, sudden load

SERVICE AGREEMENT NO. 1668

rejection, over- or under-voltage, and generator loss-of-field. Developer shall be solely

responsible to disconnect the Large Generating Facility and Developer’s other equipment if

conditions on the New York State Transmission System could adversely affect the Large

Generating Facility.

9.6.6 Power Quality.

Neither the facilities of Developer nor the facilities of Connecting Transmission Owner

shall cause excessive voltage flicker nor introduce excessive distortion to the sinusoidal voltage

or current waves as defined by ANSI Standard C84.1-1989, in accordance with IEEE Standard

519, or any applicable superseding electric industry standard. In the event of a conflict between

ANSI Standard C84.1-1989, or any applicable superseding electric industry standard, ANSI

Standard C84.1-1989, or the applicable superseding electric industry standard, shall control.

9.7 Switching and Tagging Rules.

The Developer and Connecting Transmission Owner shall each provide the other Party a

copy of its switching and tagging rules that are applicable to the other Party’s activities. Such

switching and tagging rules shall be developed on a nondiscriminatory basis. The Parties shall

comply with applicable switching and tagging rules, as amended from time to time, in obtaining

clearances for work or for switching operations on equipment.

9.8 Use of Attachment Facilities by Third Parties.

9.8.1 Purpose of Attachment Facilities.

Except as may be required by Applicable Laws and Regulations, or as otherwise agreed

to among the Parties, the Attachment Facilities shall be constructed for the sole purpose of

interconnecting the Large Generating Facility to the New York State Transmission System and

shall be used for no other purpose.

9.8.2 Third Party Users.

If required by Applicable Laws and Regulations or if the Parties mutually agree, such

agreement not to be unreasonably withheld, to allow one or more third parties to use the

Connecting Transmission Owner’s Attachment Facilities, or any part thereof, Developer will be

entitled to compensation for the capital expenses it incurred in connection with the Attachment

Facilities based upon the pro rata use of the Attachment Facilities by Connecting Transmission

Owner, all third party users, and Developer, in accordance with Applicable Laws and

Regulations or upon some other mutually-agreed upon methodology. In addition, cost

responsibility for ongoing costs, including operation and maintenance costs associated with the

Attachment Facilities, will be allocated between Developer and any third party users based upon

the pro rata use of the Attachment Facilities by Connecting Transmission Owner, all third party

users, and Developer, in accordance with Applicable Laws and Regulations or upon some other

mutually agreed upon methodology. If the issue of such compensation or allocation cannot be

resolved through such negotiations, it shall be submitted to FERC for resolution.

SERVICE AGREEMENT NO. 1668

9.9 Disturbance Analysis Data Exchange.

The Parties will cooperate with one another and the NYISO in the analysis of

disturbances to either the Large Generating Facility or the New York State Transmission System

by gathering and providing access to any information relating to any disturbance, including

information from disturbance recording equipment, protective relay targets, breaker operations

and sequence of events records, and any disturbance information required by Good Utility

Practice.

9.10 Phasor Measurement Units

A Developer shall install and maintain, at its expense, phasor measurement units

(“PMUs”) if it meets the following criteria: (1) completed a Class Year after Class Year 2017;

and (2) proposes a new Large Facility that either (a) has a maximum net output equal to or

greater than 100 MW or (b) requires, as Attachment Facilities or System Upgrade Facilities, a

new substation of 230kV or above.

PMUs shall be installed on the Large Facility on the low side of the generator step-up

transformer, unless it is a non-synchronous generation facility, in which case the PMUs shall be

installed on the Developer side of the Point of Interconnection. The PMUs must be capable of

performing phasor measurements at a minimum of 60 samples per second which are

synchronized via a high-accuracy satellite clock. To the extent Developer installs similar quality

equipment, such as relays or digital fault recorders, that can collect data at least at the same rate

as PMUs and which data is synchronized via a high-accuracy satellite clock, such equipment

would satisfy this requirement.

Developer shall be required to install and maintain, at its expense, PMU equipment which

includes the communication circuit capable of carrying the PMU data to a local data

concentrator, and then transporting the information continuously to the Connecting Transmission

Owner and the NYISO; as well as store the PMU data locally for thirty days. Developer shall

provide to Connecting Transmission Owner and the NYISO all necessary and requested

information through the Connecting Transmission Owner’s and the NYISO’s synchrophasor

system, including the following: (a) gross MW and MVAR measured at the Developer side of

the generator step-up transformer (or, for a non-synchronous generation facility, to be measured

at the Developer side of the Point of Interconnection); (b) generator terminal voltage and current

magnitudes and angles; (c) generator terminal frequency and frequency rate of change; and (d)

generator field voltage and current, where available; and (e) breaker status, if available. The

Connecting Transmission Owner will provide for the ongoing support and maintenance of the

network communications linking the data concentrator to the Connecting Transmission Owner

and the NYISO, consistent with ISO Procedures detailing the obligations related to SCADA

data.

ARTICLE 10. MAINTENANCE

10.1 Connecting Transmission Owner Obligations.

Connecting Transmission Owner shall maintain its transmission facilities and Attachment

Facilities in a safe and reliable manner and in accordance with this Agreement.

SERVICE AGREEMENT NO. 1668

10.2 Developer Obligations.

Developer shall maintain its Large Generating Facility and Attachment Facilities in a safe

and reliable manner and in accordance with this Agreement.

10.3 Coordination.

The Developer and Connecting Transmission Owner shall confer regularly to coordinate

the planning, scheduling and performance of preventive and corrective maintenance on the Large

Generating Facility and the Attachment Facilities. The Developer and Connecting Transmission

Owner shall keep NYISO fully informed of the preventive and corrective maintenance that is

planned, and shall schedule all such maintenance in accordance with NYISO procedures.

10.4 Secondary Systems.

The Developer and Connecting Transmission Owner shall each cooperate with the other

in the inspection, maintenance, and testing of control or power circuits that operate below 600

volts, AC or DC, including, but not limited to, any hardware, control or protective devices,

cables, conductors, electric raceways, secondary equipment panels, transducers, batteries,

chargers, and voltage and current transformers that directly affect the operation of Developer or

Connecting Transmission Owner’s facilities and equipment which may reasonably be expected

to impact the other Party. The Developer and Connecting Transmission Owner shall each

provide advance notice to the other Party, and to NYISO, before undertaking any work on such

circuits, especially on electrical circuits involving circuit breaker trip and close contacts, current

transformers, or potential transformers.

10.5 Operating and Maintenance Expenses.

Subject to the provisions herein addressing the use of facilities by others, and except for

operations and maintenance expenses associated with modifications made for providing

interconnection or transmission service to a third party and such third party pays for such

expenses, Developer shall be responsible for all reasonable expenses including overheads,

associated with: (1) owning, operating, maintaining, repairing, and replacing Developer’s

Attachment Facilities; and (2) operation, maintenance, repair and replacement of Connecting

Transmission Owner’s Attachment Facilities. The Connecting Transmission Owner shall be

entitled to the recovery of incremental operating and maintenance expenses that it incurs

associated with System Upgrade Facilities and System Deliverability Upgrades if and to the

extent provided for under Attachment S to the NYISO OATT.

ARTICLE 11. PERFORMANCE OBLIGATION

11.1 Developer’s Attachment Facilities.

Developer shall design, procure, construct, install, own and/or control the Developer’s

Attachment Facilities described in Appendix A hereto, at its sole expense.

SERVICE AGREEMENT NO. 1668

11.2 Connecting Transmission Owner’s Attachment Facilities.

Connecting Transmission Owner shall design, procure, construct, install, own and/or

control the Connecting Transmission Owner’s Attachment Facilities described in Appendix A

hereto, at the sole expense of the Developer.

11.3 System Upgrade Facilities and System Deliverability Upgrades.

Connecting Transmission Owner shall design, procure, construct, install, and own the

System Upgrade Facilities and System Deliverability Upgrades described in Appendix A hereto.

The responsibility of the Developer for costs related to System Upgrade Facilities and System

Deliverability Upgrades shall be determined in accordance with the provisions of Attachment S

to the ISO OATT.

11.4 Special Provisions for Affected Systems.

For the re-payment of amounts advanced to Affected System Operator for System

Upgrade Facilities or System Deliverability Upgrades, the Developer and Affected System

Operator shall enter into an agreement that provides for such re-payment, but only if

responsibility for the cost of such System Upgrade Facilities or System Deliverability Upgrades

is not to be allocated in accordance with Attachment S to the ISO OATT. The agreement shall

specify the terms governing payments to be made by the Developer to the Affected System

Operator as well as the re-payment by the Affected System Operator.

11.5 Provision of Security.

At least thirty (30) Calendar Days prior to the commencement of the procurement,

installation, or construction of a discrete portion of a Connecting Transmission Owner’s

Attachment Facilities, Developer shall provide Connecting Transmission Owner, at Developer’s

option, a guarantee, a surety bond, letter of credit or other form of security that is reasonably

acceptable to Connecting Transmission Owner and is consistent with the Uniform Commercial

Code of the jurisdiction identified in Article 14.2.1 of this Agreement. Such security for

payment shall be in an amount sufficient to cover the cost for the Developer’s share of

constructing, procuring and installing the applicable portion of Connecting Transmission

Owner’s Attachment Facilities, and shall be reduced on a dollar-for-dollar basis for payments

made to Connecting Transmission Owner for these purposes.

In addition:

11.5.1 The guarantee must be made by an entity that meets the commercially

reasonable creditworthiness requirements of Connecting Transmission Owner, and contains

terms and conditions that guarantee payment of any amount that may be due from Developer, up

to an agreed-to maximum amount.

11.5.2 The letter of credit must be issued by a financial institution reasonably

acceptable to Connecting Transmission Owner and must specify a reasonable expiration date.

SERVICE AGREEMENT NO. 1668

11.5.3 The surety bond must be issued by an insurer reasonably acceptable to

Connecting Transmission Owner and must specify a reasonable expiration date.

11.5.4 Attachment S to the ISO OATT shall govern the Security that Developer

provides for System Upgrade Facilities and System Deliverability Upgrades.

11.6 Developer Compensation for Emergency Services.

If, during an Emergency State, the Developer provides services at the request or direction

of the NYISO or Connecting Transmission Owner, the Developer will be compensated for such

services in accordance with the NYISO Services Tariff.

11.7 Line Outage Costs.

Notwithstanding anything in the ISO OATT to the contrary, the Connecting Transmission

Owner may propose to recover line outage costs associated with the installation of Connecting

Transmission Owner’s Attachment Facilities or System Upgrade Facilities or System

Deliverability Upgrades on a case-by-case basis.

ARTICLE 12. INVOICE

12.1 General.

The Developer and Connecting Transmission Owner shall each submit to the other Party,

on a monthly basis, invoices of amounts due for the preceding month. Each invoice shall state

the month to which the invoice applies and fully describe the services and equipment provided.

The Developer and Connecting Transmission Owner may discharge mutual debts and payment

obligations due and owing to each other on the same date through netting, in which case all

amounts one Party owes to the other Party under this Agreement, including interest payments or

credits, shall be netted so that only the net amount remaining due shall be paid by the owing

Party.

12.2 Final Invoice.

Within six months after completion of the construction of the Connecting Transmission

Owner’s Attachment Facilities and the System Upgrade Facilities and System Deliverability

Upgrades, Connecting Transmission Owner shall provide an invoice of the final cost of the

construction of the Connecting Transmission Owner’s Attachment Facilities and the System

Upgrade Facilities and System Deliverability Upgrades, determined in accordance with

Attachment S to the ISO OATT, and shall set forth such costs in sufficient detail to enable

Developer to compare the actual costs with the estimates and to ascertain deviations, if any, from

the cost estimates. Connecting Transmission Owner shall refund to Developer any amount by

which the actual payment by Developer for estimated costs exceeds the actual costs of

construction within thirty (30) Calendar Days of the issuance of such final construction invoice.

SERVICE AGREEMENT NO. 1668

12.3 Payment.

Invoices shall be rendered to the paying Party at the address specified in Appendix F

hereto. The Party receiving the invoice shall pay the invoice within thirty (30) Calendar Days of

receipt. All payments shall be made in immediately available funds payable to the other Party,

or by wire transfer to a bank named and account designated by the invoicing Party. Payment of

invoices will not constitute a waiver of any rights or claims the paying Party may have under this

Agreement.

12.4 Disputes.

In the event of a billing dispute between Connecting Transmission Owner and Developer,

Connecting Transmission Owner shall continue to perform under this Agreement as long as

Developer: (i) continues to make all payments not in dispute; and (ii) pays to Connecting

Transmission Owner or into an independent escrow account the portion of the invoice in dispute,

pending resolution of such dispute. If Developer fails to meet these two requirements for

continuation of service, then Connecting Transmission Owner may provide notice to Developer

of a Default pursuant to Article 17. Within thirty (30) Calendar Days after the resolution of the

dispute, the Party that owes money to the other Party shall pay the amount due with interest

calculated in accord with the methodology set forth in FERC’s Regulations at 18 C.F.R. §

35.19a(a)(2)(iii).

ARTICLE 13. EMERGENCIES

13.1 Obligations.

Each Party shall comply with the Emergency State procedures of NYISO, the applicable

Reliability Councils, Applicable Laws and Regulations, and any emergency procedures agreed to

by the NYISO Operating Committee.

13.2 Notice.

NYISO or, as applicable, Connecting Transmission Owner shall notify Developer

promptly when it becomes aware of an Emergency State that affects the Connecting

Transmission Owner’s Attachment Facilities or the New York State Transmission System that

may reasonably be expected to affect Developer’s operation of the Large Generating Facility or

the Developer’s Attachment Facilities. Developer shall notify NYISO and Connecting

Transmission Owner promptly when it becomes aware of an Emergency State that affects the

Large Generating Facility or the Developer’s Attachment Facilities that may reasonably be

expected to affect the New York State Transmission System or the Connecting Transmission

Owner’s Attachment Facilities. To the extent information is known, the notification shall

describe the Emergency State, the extent of the damage or deficiency, the expected effect on the

operation of Developer’s or Connecting Transmission Owner’s facilities and operations, its

anticipated duration and the corrective action taken and/or to be taken. The initial notice shall be

followed as soon as practicable with written notice.

SERVICE AGREEMENT NO. 1668

13.3 Immediate Action.

Unless, in Developer’s reasonable judgment, immediate action is required, Developer

shall obtain the consent of Connecting Transmission Owner, such consent to not be unreasonably

withheld, prior to performing any manual switching operations at the Large Generating Facility

or the Developer’s Attachment Facilities in response to an Emergency State either declared by

NYISO, Connecting Transmission Owner or otherwise regarding New York State Transmission

System.

13.4 NYISO and Connecting Transmission Owner Authority.

13.4.1 General.

NYISO or Connecting Transmission Owner may take whatever actions with regard to the

New York State Transmission System or the Connecting Transmission Owner’s Attachment

Facilities it deems necessary during an Emergency State in order to (i) preserve public health and

safety, (ii) preserve the reliability of the New York State Transmission System or the Connecting

Transmission Owner’s Attachment Facilities, (iii) limit or prevent damage, and (iv) expedite

restoration of service.

NYISO and Connecting Transmission Owner shall use Reasonable Efforts to minimize

the effect of such actions or inactions on the Large Generating Facility or the Developer’s

Attachment Facilities. NYISO or Connecting Transmission Owner may, on the basis of

technical considerations, require the Large Generating Facility to mitigate an Emergency State

by taking actions necessary and limited in scope to remedy the Emergency State, including, but

not limited to, directing Developer to shut-down, start-up, increase or decrease the real or

reactive power output of the Large Generating Facility; implementing a reduction or

disconnection pursuant to Article 13.4.2; directing the Developer to assist with blackstart (if

available) or restoration efforts; or altering the outage schedules of the Large Generating Facility

and the Developer’s Attachment Facilities. Developer shall comply with all of the NYISO and

Connecting Transmission Owner’s operating instructions concerning Large Generating Facility

real power and reactive power output within the manufacturer’s design limitations of the Large

Generating Facility’s equipment that is in service and physically available for operation at the

time, in compliance with Applicable Laws and Regulations.

13.4.2 Reduction and Disconnection.

NYISO or Connecting Transmission Owner may reduce Energy Resource

Interconnection Service and Capacity Resource Interconnection Service or disconnect the Large

Generating Facility or the Developer’s Attachment Facilities, when such reduction or

disconnection is necessary under Good Utility Practice due to an Emergency State. These rights

are separate and distinct from any right of Curtailment of NYISO pursuant to the ISO OATT.

When NYISO or Connecting Transmission Owner can schedule the reduction or disconnection

in advance, NYISO or Connecting Transmission Owner shall notify Developer of the reasons,

timing and expected duration of the reduction or disconnection. NYISO or Connecting

Transmission Owner shall coordinate with the Developer using Good Utility Practice to schedule

the reduction or disconnection during periods of least impact to the Developer and the New York

SERVICE AGREEMENT NO. 1668

State Transmission System. Any reduction or disconnection shall continue only for so long as

reasonably necessary under Good Utility Practice. The Parties shall cooperate with each other to

restore the Large Generating Facility, the Attachment Facilities, and the New York State

Transmission System to their normal operating state as soon as practicable consistent with Good

Utility Practice.

13.5 Developer Authority.

Consistent with Good Utility Practice and this Agreement, the Developer may take

whatever actions or inactions with regard to the Large Generating Facility or the Developer’s

Attachment Facilities during an Emergency State in order to (i) preserve public health and safety,

(ii) preserve the reliability of the Large Generating Facility or the Developer’s Attachment

Facilities, (iii) limit or prevent damage, and (iv) expedite restoration of service. Developer shall

use Reasonable Efforts to minimize the effect of such actions or inactions on the New York State

Transmission System and the Connecting Transmission Owner’s Attachment Facilities. NYISO

and Connecting Transmission Owner shall use Reasonable Efforts to assist Developer in such

actions.

13.6 Limited Liability.

Except as otherwise provided in Article 11.6 of this Agreement, no Party shall be liable

to another Party for any action it takes in responding to an Emergency State so long as such

action is made in good faith and is consistent with Good Utility Practice and the NYISO Tariffs.

ARTICLE 14. REGULATORY REQUIREMENTS AND GOVERNING LAW

14.1 Regulatory Requirements.

Each Party’s obligations under this Agreement shall be subject to its receipt of any

required approval or certificate from one or more Governmental Authorities in the form and

substance satisfactory to the applying Party, or the Party making any required filings with, or

providing notice to, such Governmental Authorities, and the expiration of any time period

associated therewith. Each Party shall in good faith seek and use its Reasonable Efforts to obtain

such other approvals. Nothing in this Agreement shall require Developer to take any action that

could result in its inability to obtain, or its loss of, status or exemption under the Federal Power

Act or the Public Utility Holding Company Act of 2005 or the Public Utility Regulatory Policies

Act of 1978, as amended.

14.2 Governing Law.

14.2.1 The validity, interpretation and performance of this Agreement and each of its

provisions shall be governed by the laws of the state of New York, without regard to its conflicts

of law principles.

14.2.2 This Agreement is subject to all Applicable Laws and Regulations.

14.2.3 Each Party expressly reserves the right to seek changes in, appeal, or

otherwise contest any laws, orders, rules, or regulations of a Governmental Authority.

SERVICE AGREEMENT NO. 1668

ARTICLE 15. NOTICES

15.1 General.

Unless otherwise provided in this Agreement, any notice, demand or request required or

permitted to be given by a Party to the other Parties and any instrument required or permitted to

be tendered or delivered by a Party in writing to the other Parties shall be effective when

delivered and may be so given, tendered or delivered, by recognized national courier, or by

depositing the same with the United States Postal Service with postage prepaid, for delivery by

certified or registered mail, addressed to the Party, or personally delivered to the Party, at the

address set out in Appendix F hereto.

A Party may change the notice information in this Agreement by giving five (5) Business

Days written notice prior to the effective date of the change.

15.2 Billings and Payments.

Billings and payments shall be sent to the addresses set out in Appendix F hereto.

15.3 Alternative Forms of Notice.

Any notice or request required or permitted to be given by a Party to the other Parties and

not required by this Agreement to be given in writing may be so given by telephone, facsimile or

email to the telephone numbers and email addresses set out in Appendix F hereto.

15.4 Operations and Maintenance Notice.

Developer and Connecting Transmission Owner shall each notify the other Party, and

NYISO, in writing of the identity of the person(s) that it designates as the point(s) of contact with

respect to the implementation of Articles 9 and 10 of this Agreement.

ARTICLE 16. FORCE MAJEURE

16.1 Economic hardship is not considered a Force Majeure event.

16.2 A Party shall not be responsible or liable, or deemed, in Default with respect to

any obligation hereunder, (including obligations under Article 4 of this Agreement) , other than

the obligation to pay money when due, to the extent the Party is prevented from fulfilling such

obligation by Force Majeure. A Party unable to fulfill any obligation hereunder (other than an

obligation to pay money when due) by reason of Force Majeure shall give notice and the full

particulars of such Force Majeure to the other Parties in writing or by telephone as soon as

reasonably possible after the occurrence of the cause relied upon. Telephone notices given

pursuant to this Article shall be confirmed in writing as soon as reasonably possible and shall

specifically state full particulars of the Force Majeure, the time and date when the Force Majeure

occurred and when the Force Majeure is reasonably expected to cease. The Party affected shall

exercise due diligence to remove such disability with reasonable dispatch, but shall not be

required to accede or agree to any provision not satisfactory to it in order to settle and terminate a

strike or other labor disturbance.

SERVICE AGREEMENT NO. 1668

ARTICLE 17. DEFAULT

17.1 General.

No Breach shall exist where such failure to discharge an obligation (other than the

payment of money) is the result of Force Majeure as defined in this Agreement or the result of an

act or omission of the other Parties. Upon a Breach, the non-Breaching Parties shall give written

notice of such to the Breaching Party. The Breaching Party shall have thirty (30) Calendar Days

from receipt of the Breach notice within which to cure such Breach; provided however, if such

Breach is not capable of cure within thirty (30) Calendar Days, the Breaching Party shall

commence such cure within thirty (30) Calendar Days after notice and continuously and

diligently complete such cure within ninety (90) Calendar Days from receipt of the Breach

notice; and, if cured within such time, the Breach specified in such notice shall cease to exist.

17.2 Right to Terminate.

If a Breach is not cured as provided in this Article 17, or if a Breach is not capable of

being cured within the period provided for herein, the non-Breaching Parties acting together shall

thereafter have the right to declare a Default and terminate this Agreement by written notice at

any time until cure occurs, and be relieved of any further obligation hereunder and, whether or

not those Parties terminate this Agreement, to recover from the defaulting Party all amounts due

hereunder, plus all other damages and remedies to which they are entitled at law or in equity.

The provisions of this Article will survive termination of this Agreement.

ARTICLE 18. INDEMNITY, CONSEQUENTIAL DAMAGES AND INSURANCE

18.1 Indemnity.

Each Party (the “Indemnifying Party”) shall at all times indemnify, defend, and save

harmless, as applicable, the other Parties (each an “Indemnified Party”) from, any and all

damages, losses, claims, including claims and actions relating to injury to or death of any person

or damage to property, the alleged violation of any Environmental Law, or the release or

threatened release of any Hazardous Substance, demand, suits, recoveries, costs and expenses,

court costs, attorney fees, and all other obligations by or to third parties, arising out of or

resulting from (i) the Indemnified Party’s performance of its obligations under this Agreement

on behalf of the Indemnifying Party, except in cases where the Indemnifying Party can

demonstrate that the Loss of the Indemnified Party was caused by the gross negligence or

intentional wrongdoing of the Indemnified Party or (ii) the violation by the Indemnifying Party

of any Environmental Law or the release by the Indemnifying Party of any Hazardous Substance.

18.1.1 Indemnified Party.

If a Party is entitled to indemnification under this Article 18 as a result of a claim by a

third party, and the indemnifying Party fails, after notice and reasonable opportunity to proceed

under Article 18.1.3, to assume the defense of such claim, such Indemnified Party may at the

expense of the Indemnifying Party contest, settle or consent to the entry of any judgment with

respect to, or pay in full, such claim.

SERVICE AGREEMENT NO. 1668

18.1.2 Indemnifying Party.

If an Indemnifying Party is obligated to indemnify and hold any Indemnified Party

harmless under this Article 18, the amount owing to the Indemnified Party shall be the amount of

such Indemnified Party’s actual Loss, net of any insurance or other recovery.

18.1.3 Indemnity Procedures.

Promptly after receipt by an Indemnified Party of any claim or notice of the

commencement of any action or administrative or legal proceeding or investigation as to which

the indemnity provided for in Article 18.1 may apply, the Indemnified Party shall notify the

Indemnifying Party of such fact. Any failure of or delay in such notification shall not affect a

Party’s indemnification obligation unless such failure or delay is materially prejudicial to the

Indemnifying Party.

Except as stated below, the Indemnifying Party shall have the right to assume the defense

thereof with counsel designated by such Indemnifying Party and reasonably satisfactory to the

Indemnified Party. If the defendants in any such action include one or more Indemnified Parties

and the Indemnifying Party and if the Indemnified Party reasonably concludes that there may be

legal defenses available to it and/or other Indemnified Parties which are different from or

additional to those available to the Indemnifying Party, the Indemnified Party shall have the right

to select separate counsel to assert such legal defenses and to otherwise participate in the defense

of such action on its own behalf. In such instances, the Indemnifying Party shall only be

required to pay the fees and expenses of one additional attorney to represent an Indemnified

Party or Indemnified Parties having such differing or additional legal defenses.

The Indemnified Party shall be entitled, at its expense, to participate in any such action,

suit or proceeding, the defense of which has been assumed by the Indemnifying Party.

Notwithstanding the foregoing, the Indemnifying Party (i) shall not be entitled to assume and

control the defense of any such action, suit or proceedings if and to the extent that, in the opinion

of the Indemnified Party and its counsel, such action, suit or proceeding involves the potential

imposition of criminal liability on the Indemnified Party, or there exists a conflict or adversity of

interest between the Indemnified Party and the Indemnifying Party, in such event the

Indemnifying Party shall pay the reasonable expenses of the Indemnified Party, and (ii) shall not

settle or consent to the entry of any judgment in any action, suit or proceeding without the

consent of the Indemnified Party, which shall not be unreasonably withheld, conditioned or

delayed.

18.2 No Consequential Damages.

Other than the liquidated damages heretofore described and the indemnity obligations set

forth in Article 18.1, in no event shall any Party be liable under any provision of this Agreement

for any losses, damages, costs or expenses for any special, indirect, incidental, consequential, or

punitive damages, including but not limited to loss of profit or revenue, loss of the use of

equipment, cost of capital, cost of temporary equipment or services, whether based in whole or in

part in contract, in tort, including negligence, strict liability, or any other theory of liability;

provided, however, that damages for which a Party may be liable to another Party under separate

SERVICE AGREEMENT NO. 1668

agreement will not be considered to be special, indirect, incidental, or consequential damages

hereunder.

18.3 Insurance.

Developer and Connecting Transmission Owner shall each, at its own expense, procure

and maintain in force throughout the period of this Agreement and until released by the other

Parties, the following minimum insurance coverages, with insurance companies licensed to write

insurance or approved eligible surplus lines carriers in the state of New York with a minimum

A.M. Best rating of A or better for financial strength, and an A.M. Best financial size category of

VIII or better:

18.3.1 Employers’ Liability and Workers’ Compensation Insurance providing

statutory benefits in accordance with the laws and regulations of New York State.

18.3.2 Commercial General Liability (“CGL”) Insurance including premises and

operations, personal injury, broad form property damage, broad form blanket contractual liability

coverage products and completed operations coverage, coverage for explosion, collapse and

underground hazards, independent contractors coverage, coverage for pollution to the extent

normally available and punitive damages to the extent normally available using Insurance

Services Office, Inc. Commercial General Liability Coverage (“ISO CG”) Form CG 00 01 04 13

or a form equivalent to or better than CG 00 01 04 13, with minimum limits of Two Million

Dollars ($2,000,000) per occurrence and Two Million Dollars ($2,000,000) aggregate combined

single limit for personal injury, bodily injury, including death and property damage.

18.3.3 Comprehensive Automobile Liability Insurance for coverage of owned and

non-owned and hired vehicles, trailers or semi-trailers designed for travel on public roads, with a

minimum, combined single limit of One Million Dollars ($1,000,000) per occurrence for bodily

injury, including death, and property damage.

18.3.4 If applicable, the Commercial General Liability and Comprehensive

Automobile Liability Insurance policies should include contractual liability for work in

connection with constructions or demolition work on or within 50 feet of a railroad, or a separate

Railroad Protective Liability Policy should be provided.

18.3.5 Excess Liability Insurance over and above the Employers’ Liability,

Commercial General Liability and Comprehensive Automobile Liability Insurance coverages,

with a minimum combined single limit of Twenty Million Dollars ($20,000,000) per occurrence

and Twenty Million Dollars ($20,000,000) aggregate. The Excess policies should contain the

same extensions listed under the Primary policies.

18.3.6 The Commercial General Liability Insurance, Comprehensive Automobile

Insurance and Excess Liability Insurance policies of Developer and Connecting Transmission

Owner shall name the other Party, its parent, associated and Affiliate companies and their

respective directors, officers, agents, servants and employees (“Other Party Group”) as additional

insureds using ISO CG Endorsements: CG 20 33 04 13, and CG 20 37 04 13 or CG 20 10 04 13

and CG 20 37 04 13 or equivalent to or better forms. All policies shall contain provisions

whereby the insurers waive all rights of subrogation in accordance with the provisions of this

SERVICE AGREEMENT NO. 1668

Agreement against the Other Party Group and provide thirty (30) Calendar days advance written

notice to the Other Party Group prior to anniversary date of cancellation or any material change

in coverage or condition.

18.3.7 The Commercial General Liability Insurance, Comprehensive Automobile

Liability Insurance and Excess Liability Insurance policies shall contain provisions that specify

that the policies are primary and non-contributory. Developer and Connecting Transmission

Owner shall each be responsible for its respective deductibles or retentions.

18.3.8 The Commercial General Liability Insurance, Comprehensive Automobile

Liability Insurance and Excess Liability Insurance policies, if written on a Claims First Made

Basis, shall be maintained in full force and effect for at least three (3) years after termination of

this Agreement, which coverage may be in the form of tail coverage or extended reporting period

coverage if agreed by the Developer and Connecting Transmission Owner.

18.3.9 If applicable, Pollution Liability Insurance in an amount no less than

$7,500,000 per occurrence and $7,500,000 in the aggregate. The policy will provide coverage

for claims resulting from pollution or other environmental impairment arising out of or in

connection with work performed on the premises by the other party, its contractors and and/or

subcontractors. Such insurance is to include coverage for, but not be limited to, cleanup, third

party bodily injury and property damage and remediation and will be written on an occurrence

basis. The policy shall name the Other Party Group as additional insureds, be primary and

contain a waiver of subrogation.

18.3.10 The requirements contained herein as to the types and limits of all insurance

to be maintained by the Developer and Connecting Transmission Owner are not intended to and

shall not in any manner, limit or qualify the liabilities and obligations assumed by those Parties

under this Agreement.

18.3.11 Within ten (10) days following execution of this Agreement, and as soon as

practicable after the end of each fiscal year or at the renewal of the insurance policy and in any

event within ninety (90) days thereafter, Developer and Connecting Transmission Owner shall

provide certificate of insurance for all insurance required in this Agreement, executed by each

insurer or by an authorized representative of each insurer.

18.3.12 Notwithstanding the foregoing, Developer and Connecting Transmission

Owner may each self-insure to meet the minimum insurance requirements of Articles 18.3.1

through 18.3.9 to the extent it maintains a self-insurance program; provided that, such Party’s

senior debt is rated at investment grade, or better, by Standard & Poor’s and that its self-

insurance program meets the minimum insurance requirements of Articles 18.3.1 through 18.3.9.

In the event that a Party is permitted to self-insure pursuant to this Article 18.3.12, it shall notify

the other Party that it meets the requirements to self-insure and that its self-insurance program

meets the minimum insurance requirements in a manner consistent with that specified in Articles

18.3.1 through 18.3.9 and provide evidence of such coverages. For any period of time that a

Party’s senior debt is unrated by Standard & Poor’s or is rated at less than investment grade by

Standard & Poor’s, such Party shall comply with the insurance requirements applicable to it

under Articles 18.3.1 through 18.3.9.

SERVICE AGREEMENT NO. 1668

18.3.13 Developer and Connecting Transmission Owner agree to report to each other

in writing as soon as practical all accidents or occurrences resulting in injuries to any person,

including death, and any property damage arising out of this Agreement.

18.3.14 Subcontractors of each party must maintain the same insurance requirements

stated under Articles 18.3.1 through 18.3.9 and comply with the Additional Insured requirements

herein . In addition, their policies must state that they are primary and non-contributory and

contain a waiver of subrogation.

ARTICLE 19. ASSIGNMENT

This Agreement may be assigned by a Party only with the written consent of the other

Parties; provided that a Party may assign this Agreement without the consent of the other Parties

to any Affiliate of the assigning Party with an equal or greater credit rating and with the legal

authority and operational ability to satisfy the obligations of the assigning Party under this

Agreement; provided further that a Party may assign this Agreement without the consent of the

other Parties in connection with the sale, merger, restructuring, or transfer of a substantial

portion or all of its assets, including the Attachment Facilities it owns, so long as the assignee in

such a transaction directly assumes in writing all rights, duties and obligations arising under this

Agreement; and provided further that the Developer shall have the right to assign this

Agreement, without the consent of the NYISO or Connecting Transmission Owner, for collateral

security purposes to aid in providing financing for the Large Generating Facility, provided that

the Developer will promptly notify the NYISO and Connecting Transmission Owner of any such

assignment. Any financing arrangement entered into by the Developer pursuant to this Article

will provide that prior to or upon the exercise of the secured party’s, trustee’s or mortgagee’s

assignment rights pursuant to said arrangement, the secured creditor, the trustee or mortgagee

will notify the NYISO and Connecting Transmission Owner of the date and particulars of any

such exercise of assignment right(s) and will provide the NYISO and Connecting Transmission

Owner with proof that it meets the requirements of Articles 11.5 and 18.3. Any attempted

assignment that violates this Article is void and ineffective. Any assignment under this

Agreement shall not relieve a Party of its obligations, nor shall a Party’s obligations be enlarged,

in whole or in part, by reason thereof. Where required, consent to assignment will not be

unreasonably withheld, conditioned or delayed.

ARTICLE 20. SEVERABILITY

If any provision in this Agreement is finally determined to be invalid, void or

unenforceable by any court or other Governmental Authority having jurisdiction, such

determination shall not invalidate, void or make unenforceable any other provision, agreement or

covenant of this Agreement; provided that if the Developer (or any third party, but only if such

third party is not acting at the direction of the Connecting Transmission Owner) seeks and

obtains such a final determination with respect to any provision of the Alternate Option (Article

5.1.2), or the Negotiated Option (Article 5.1.4), then none of these provisions shall thereafter

have any force or effect and the rights and obligations of Developer and Connecting

Transmission Owner shall be governed solely by the Standard Option (Article 5.1.1).

SERVICE AGREEMENT NO. 1668

ARTICLE 21. COMPARABILITY

The Parties will comply with all applicable comparability and code of conduct laws, rules

and regulations, as amended from time to time.

ARTICLE 22. CONFIDENTIALITY

22.1 Confidentiality.

Certain information exchanged by the Parties during the term of this Agreement shall

constitute confidential information (“Confidential Information”) and shall be subject to this

Article 22.

If requested by a Party receiving information, the Party supplying the information shall

provide in writing, the basis for asserting that the information referred to in this Article warrants

confidential treatment, and the requesting Party may disclose such writing to the appropriate

Governmental Authority. Each Party shall be responsible for the costs associated with affording

confidential treatment to its information.

22.2 Term.

During the term of this Agreement, and for a period of three (3) years after the expiration

or termination of this Agreement, except as otherwise provided in this Article 22, each Party

shall hold in confidence and shall not disclose to any person Confidential Information.

22.3 Confidential Information.

The following shall constitute Confidential Information: (1) any non-public information

that is treated as confidential by the disclosing Party and which the disclosing Party identifies as

Confidential Information in writing at the time, or promptly after the time, of disclosure; or (2)

information designated as Confidential Information by the NYISO Code of Conduct contained in

Attachment F to the ISO OATT.

22.4 Scope.

Confidential Information shall not include information that the receiving Party can

demonstrate: (1) is generally available to the public other than as a result of a disclosure by the

receiving Party; (2) was in the lawful possession of the receiving Party on a non-confidential

basis before receiving it from the disclosing Party; (3) was supplied to the receiving Party

without restriction by a third party, who, to the knowledge of the receiving Party after due

inquiry, was under no obligation to the disclosing Party to keep such information confidential;

(4) was independently developed by the receiving Party without reference to Confidential

Information of the disclosing Party; (5) is, or becomes, publicly known, through no wrongful act

or omission of the receiving Party or Breach of this Agreement; or (6) is required, in accordance

with Article 22.9 of this Agreement, Order of Disclosure, to be disclosed by any Governmental

Authority or is otherwise required to be disclosed by law or subpoena, or is necessary in any

legal proceeding establishing rights and obligations under this Agreement. Information

designated as Confidential Information will no longer be deemed confidential if the Party that

SERVICE AGREEMENT NO. 1668

designated the information as confidential notifies the other Party that it no longer is

confidential.

22.5 Release of Confidential Information.

No Party shall release or disclose Confidential Information to any other person, except to

its Affiliates (limited by FERC Standards of Conduct requirements), subcontractors, employees,

consultants, or to parties who may be considering providing financing to or equity participation

with Developer, or to potential purchasers or assignees of a Party, on a need-to-know basis in

connection with this Agreement, unless such person has first been advised of the confidentiality

provisions of this Article 22 and has agreed to comply with such provisions. Notwithstanding

the foregoing, a Party providing Confidential Information to any person shall remain primarily

responsible for any release of Confidential Information in contravention of this Article 22.

22.6 Rights.

Each Party retains all rights, title, and interest in the Confidential Information that each

Party discloses to the other Party. The disclosure by each Party to the other Parties of

Confidential Information shall not be deemed a waiver by any Party or any other person or entity

of the right to protect the Confidential Information from public disclosure.

22.7 No Warranties.

By providing Confidential Information, no Party makes any warranties or representations

as to its accuracy or completeness. In addition, by supplying Confidential Information, no Party

obligates itself to provide any particular information or Confidential Information to the other

Parties nor to enter into any further agreements or proceed with any other relationship or joint

venture.

22.8 Standard of Care.

Each Party shall use at least the same standard of care to protect Confidential Information

it receives as it uses to protect its own Confidential Information from unauthorized disclosure,

publication or dissemination. Each Party may use Confidential Information solely to fulfill its

obligations to the other Party under this Agreement or its regulatory requirements, including the

ISO OATT and NYISO Services Tariff. The NYISO shall, in all cases, treat the information it

receives in accordance with the requirements of Attachment F to the ISO OATT.

22.9 Order of Disclosure.

If a court or a Government Authority or entity with the right, power, and apparent

authority to do so requests or requires any Party, by subpoena, oral deposition, interrogatories,

requests for production of documents, administrative order, or otherwise, to disclose Confidential

Information, that Party shall provide the other Parties with prompt notice of such request(s) or

requirement(s) so that the other Parties may seek an appropriate protective order or waive

compliance with the terms of this Agreement. Notwithstanding the absence of a protective order

or waiver, the Party may disclose such Confidential Information which, in the opinion of its

counsel, the Party is legally compelled to disclose. Each Party will use Reasonable Efforts to

SERVICE AGREEMENT NO. 1668

obtain reliable assurance that confidential treatment will be accorded any Confidential

Information so furnished.

22.10 Termination of Agreement.

Upon termination of this Agreement for any reason, each Party shall, within ten (10)

Calendar Days of receipt of a written request from the other Parties, use Reasonable Efforts to

destroy, erase, or delete (with such destruction, erasure, and deletion certified in writing to the

other Parties) or return to the other Parties, without retaining copies thereof, any and all written

or electronic Confidential Information received from the other Parties pursuant to this

Agreement.

22.11 Remedies.

The Parties agree that monetary damages would be inadequate to compensate a Party for

another Party’s Breach of its obligations under this Article 22. Each Party accordingly agrees

that the other Parties shall be entitled to equitable relief, by way of injunction or otherwise, if the

first Party Breaches or threatens to Breach its obligations under this Article 22, which equitable

relief shall be granted without bond or proof of damages, and the receiving Party shall not plead

in defense that there would be an adequate remedy at law. Such remedy shall not be deemed an

exclusive remedy for the Breach of this Article 22, but shall be in addition to all other remedies

available at law or in equity. The Parties further acknowledge and agree that the covenants

contained herein are necessary for the protection of legitimate business interests and are

reasonable in scope. No Party, however, shall be liable for indirect, incidental, or consequential

or punitive damages of any nature or kind resulting from or arising in connection with this

Article 22.

22.12 Disclosure to FERC, its Staff, or a State.

Notwithstanding anything in this Article 22 to the contrary, and pursuant to 18 C.F.R.

section 1b.20, if FERC or its staff, during the course of an investigation or otherwise, requests

information from one of the Parties that is otherwise required to be maintained in confidence

pursuant to this Agreement or the ISO OATT, the Party shall provide the requested information

to FERC or its staff, within the time provided for in the request for information. In providing the

information to FERC or its staff, the Party must, consistent with 18 C.F.R. section 388.112,

request that the information be treated as confidential and non-public by FERC and its staff and

that the information be withheld from public disclosure. Parties are prohibited from notifying

the other Parties to this Agreement prior to the release of the Confidential Information to the

Commission or its staff. The Party shall notify the other Parties to the Agreement when it is

notified by FERC or its staff that a request to release Confidential Information has been received

by FERC, at which time the Parties may respond before such information would be made public,

pursuant to 18 C.F.R. section 388.112. Requests from a state regulatory body conducting a

confidential investigation shall be treated in a similar manner if consistent with the applicable

state rules and regulations. A Party shall not be liable for any losses, consequential or otherwise,

resulting from that Party divulging Confidential Information pursuant to a FERC or state

regulatory body request under this paragraph.

SERVICE AGREEMENT NO. 1668

22.13 Required Notices Upon Requests or Demands for Confidential Information

Except as otherwise expressly provided herein, no Party shall disclose Confidential

Information to any person not employed or retained by the Party possessing the Confidential

Information, except to the extent disclosure is (i) required by law; (ii) reasonably deemed by the

disclosing Party to be required to be disclosed in connection with a dispute between or among

the Parties, or the defense of litigation or dispute; (iii) otherwise permitted by consent of the

other Party, such consent not to be unreasonably withheld; or (iv) necessary to fulfill its

obligations under this Agreement, the ISO OATT or the NYISO Services Tariff. Prior to any

disclosures of a Party’s Confidential Information under this subparagraph, or if any third party or

Governmental Authority makes any request or demand for any of the information described in

this subparagraph, the disclosing Party agrees to promptly notify the other Party in writing and

agrees to assert confidentiality and cooperate with the other Party in seeking to protect the

Confidential Information from public disclosure by confidentiality agreement, protective order or

other reasonable measures.

ARTICLE 23. DEVELOPER AND CONNECTING TRANSMISSION OWNER

NOTICES OF ENVIRONMENTAL RELEASES

Developer and Connecting Transmission Owner shall each notify the other Party, first

orally and then in writing, of the release of any Hazardous Substances, any asbestos or lead

abatement activities, or any type of remediation activities related to the Large Generating Facility

or the Attachment Facilities, each of which may reasonably be expected to affect the other Party.

The notifying Party shall: (i) provide the notice as soon as practicable, provided such Party

makes a good faith effort to provide the notice no later than twenty-four hours after such Party

becomes aware of the occurrence; and (ii) promptly furnish to the other Party copies of any

publicly available reports filed with any Governmental Authorities addressing such events.

ARTICLE 24. INFORMATION REQUIREMENT

24.1 Information Acquisition.

Connecting Transmission Owner and Developer shall each submit specific information

regarding the electrical characteristics of their respective facilities to the other, and to NYISO, as

described below and in accordance with Applicable Reliability Standards.

24.2 Information Submission by Connecting Transmission Owner.

The initial information submission by Connecting Transmission Owner shall occur no

later than one hundred eighty (180) Calendar Days prior to Trial Operation and shall include

New York State Transmission System information necessary to allow the Developer to select

equipment and meet any system protection and stability requirements, unless otherwise mutually

agreed to by the Developer and Connecting Transmission Owner. On a monthly basis

Connecting Transmission Owner shall provide Developer and NYISO a status report on the

construction and installation of Connecting Transmission Owner’s Attachment Facilities and

System Upgrade Facilities and System Deliverability Upgrades, including, but not limited to, the

following information: (1) progress to date; (2) a description of the activities since the last

SERVICE AGREEMENT NO. 1668

report; (3) a description of the action items for the next period; and (4) the delivery status of

equipment ordered.

24.3 Updated Information Submission by Developer.

The updated information submission by the Developer, including manufacturer

information, shall occur no later than one hundred eighty (180) Calendar Days prior to the Trial

Operation. Developer shall submit a completed copy of the Large Generating Facility data

requirements contained in Appendix 1 to the Standard Large Facility Interconnection Procedures.

It shall also include any additional information provided to Connecting Transmission Owner for

the Interconnection Facilities Study. Information in this submission shall be the most current

Large Generating Facility design or expected performance data. Information submitted for

stability models shall be compatible with NYISO standard models. If there is no compatible

model, the Developer will work with a consultant mutually agreed to by the Parties to develop

and supply a standard model and associated information.

If the Developer’s data is different from what was originally provided to Connecting

Transmission Owner and NYISO pursuant to an Interconnection Study Agreement among

Connecting Transmission Owner, NYISO and Developer and this difference may be reasonably

expected to affect the other Parties’ facilities or the New York State Transmission System, but

does not require the submission of a new Interconnection Request, then NYISO will conduct

appropriate studies to determine the impact on the New York State Transmission System based

on the actual data submitted pursuant to this Article 24.3. Such studies will provide an estimate

of any additional modifications to the New York State Transmission System, Connecting

Transmission Owner’s Attachment Facilities or System Upgrade Facilities or System

Deliverability Upgrades based on the actual data and a good faith estimate of the costs thereof.

The Developer shall not begin Trial Operation until such studies are completed. The Developer

shall be responsible for the cost of any modifications required by the actual data, including the

cost of any required studies.

24.4 Information Supplementation.

Prior to the Commercial Operation Date, the Developer and Connecting Transmission

Owner shall supplement their information submissions described above in this Article 24 with

any and all “as-built” Large Generating Facility information or “as-tested” performance

information that differs from the initial submissions or, alternatively, written confirmation that

no such differences exist. The Developer shall conduct tests on the Large Generating Facility as

required by Good Utility Practice such as an open circuit “step voltage” test on the Large

Generating Facility to verify proper operation of the Large Generating Facility’s automatic

voltage regulator.

Unless otherwise agreed, the test conditions shall include: (1) Large Generating Facility

at synchronous speed; (2) automatic voltage regulator on and in voltage control mode; and (3) a

five percent change in Large Generating Facility terminal voltage initiated by a change in the

voltage regulators reference voltage. Developer shall provide validated test recordings showing

the responses of Large Generating Facility terminal and field voltages. In the event that direct

recordings of these voltages is impractical, recordings of other voltages or currents that mirror

SERVICE AGREEMENT NO. 1668

the response of the Large Generating Facility’s terminal or field voltage are acceptable if

information necessary to translate these alternate quantities to actual Large Generating Facility

terminal or field voltages is provided. Large Generating Facility testing shall be conducted and

results provided to the Connecting Transmission Owner and NYISO for each individual

generating unit in a station.

Subsequent to the Commercial Operation Date, the Developer shall provide Connecting

Transmission Owner and NYISO any information changes due to equipment replacement, repair,

or adjustment. Connecting Transmission Owner shall provide the Developer and NYISO any

information changes due to equipment replacement, repair or adjustment in the directly

connected substation or any adjacent Connecting Transmission Owner substation that may affect

the Developer Attachment Facilities equipment ratings, protection or operating requirements.

The Developer and Connecting Transmission Owner shall provide such information no later than

thirty (30) Calendar Days after the date of the equipment replacement, repair or adjustment.

ARTICLE 25. INFORMATION ACCESS AND AUDIT RIGHTS

25.1 Information Access.

Each Party (“Disclosing Party”) shall make available to another Party (“Requesting

Party”) information that is in the possession of the Disclosing Party and is necessary in order for

the Requesting Party to: (i) verify the costs incurred by the Disclosing Party for which the

Requesting Party is responsible under this Agreement; and (ii) carry out its obligations and

responsibilities under this Agreement. The Parties shall not use such information for purposes

other than those set forth in this Article 25.1 of this Agreement and to enforce their rights under

this Agreement.

25.2 Reporting of Non-Force Majeure Events.

Each Party (the “Notifying Party”) shall notify the other Parties when the Notifying Party

becomes aware of its inability to comply with the provisions of this Agreement for a reason other

than a Force Majeure event. The Parties agree to cooperate with each other and provide

necessary information regarding such inability to comply, including the date, duration, reason for

the inability to comply, and corrective actions taken or planned to be taken with respect to such

inability to comply. Notwithstanding the foregoing, notification, cooperation or information

provided under this Article shall not entitle the Party receiving such notification to allege a cause

for anticipatory breach of this Agreement.

25.3 Audit Rights.

Subject to the requirements of confidentiality under Article 22 of this Agreement, each

Party shall have the right, during normal business hours, and upon prior reasonable notice to

another Party, to audit at its own expense the other Party’s accounts and records pertaining to the

other Party’s performance or satisfaction of its obligations under this Agreement. Such audit

rights shall include audits of the other Party’s costs, calculation of invoiced amounts, and each

Party’s actions in an Emergency State. Any audit authorized by this Article shall be performed

at the offices where such accounts and records are maintained and shall be limited to those

portions of such accounts and records that relate to the Party’s performance and satisfaction of

SERVICE AGREEMENT NO. 1668

obligations under this Agreement. Each Party shall keep such accounts and records for a period

equivalent to the audit rights periods described in Article 25.4 of this Agreement.

25.4 Audit Rights Periods.

25.4.1 Audit Rights Period for Construction-Related Accounts and Records.

Accounts and records related to the design, engineering, procurement, and construction of

Connecting Transmission Owner’s Attachment Facilities and System Upgrade Facilities and

System Deliverability Upgrades shall be subject to audit for a period of twenty-four months

following Connecting Transmission Owner’s issuance of a final invoice in accordance with

Article 12.2 of this Agreement.

25.4.2 Audit Rights Period for All Other Accounts and Records.

Accounts and records related to a Party’s performance or satisfaction of its obligations

under this Agreement other than those described in Article 25.4.1 of this Agreement shall be

subject to audit as follows: (i) for an audit relating to cost obligations, the applicable audit rights

period shall be twenty-four months after the auditing Party’s receipt of an invoice giving rise to

such cost obligations; and (ii) for an audit relating to all other obligations, the applicable audit

rights period shall be twenty-four months after the event for which the audit is sought.

25.5 Audit Results.

If an audit by a Party determines that an overpayment or an underpayment has occurred, a

notice of such overpayment or underpayment shall be given to the other Party together with

those records from the audit which support such determination.

ARTICLE 26. SUBCONTRACTORS

26.1 General.

Nothing in this Agreement shall prevent a Party from utilizing the services of any

subcontractor as it deems appropriate to perform its obligations under this Agreement; provided,

however, that each Party shall require its subcontractors to comply with all applicable terms and

conditions of this Agreement in providing such services and each Party shall remain primarily

liable to the other Parties for the performance of such subcontractor.

26.2 Responsibility of Principal.

The creation of any subcontract relationship shall not relieve the hiring Party of any of its

obligations under this Agreement. The hiring Party shall be fully responsible to the other Parties

for the acts or omissions of any subcontractor the hiring Party hires as if no subcontract had been

made; provided, however, that in no event shall the NYISO or Connecting Transmission Owner

be liable for the actions or inactions of the Developer or its subcontractors with respect to

obligations of the Developer under Article 5 of this Agreement. Any applicable obligation

imposed by this Agreement upon the hiring Party shall be equally binding upon, and shall be

construed as having application to, any subcontractor of such Party.

SERVICE AGREEMENT NO. 1668

26.3 No Limitation by Insurance.

The obligations under this Article 26 will not be limited in any way by any limitation of

subcontractor’s insurance.

ARTICLE 27. DISPUTES

27.1 Submission.

In the event any Party has a dispute, or asserts a claim, that arises out of or in connection

with this Agreement or its performance (a “Dispute”), such Party shall provide the other Parties

with written notice of the Dispute (“Notice of Dispute”). Such Dispute shall be referred to a

designated senior representative of each Party for resolution on an informal basis as promptly as

practicable after receipt of the Notice of Dispute by the other Parties. In the event the designated

representatives are unable to resolve the Dispute through unassisted or assisted negotiations

within thirty (30) Calendar Days of the other Parties’ receipt of the Notice of Dispute, such

Dispute may, upon mutual agreement of the Parties, be submitted to arbitration and resolved in

accordance with the arbitration procedures set forth below. In the event the Parties do not agree

to submit such Dispute to arbitration, each Party may exercise whatever rights and remedies it

may have in equity or at law consistent with the terms of this Agreement.

27.2 External Arbitration Procedures.

Any arbitration initiated under this Agreement shall be conducted before a single neutral

arbitrator appointed by the Parties. If the Parties fail to agree upon a single arbitrator within ten

(10) Calendar Days of the submission of the Dispute to arbitration, each Party shall choose one

arbitrator who shall sit on a three-member arbitration panel. In each case, the arbitrator(s) shall

be knowledgeable in electric utility matters, including electric transmission and bulk power

issues, and shall not have any current or past substantial business or financial relationships with

any party to the arbitration (except prior arbitration). The arbitrator(s) shall provide each of the

Parties an opportunity to be heard and, except as otherwise provided herein, shall conduct the

arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration

Association (“Arbitration Rules”) and any applicable FERC regulations or RTO rules; provided,

however, in the event of a conflict between the Arbitration Rules and the terms of this Article 27,

the terms of this Article 27 shall prevail.

27.3 Arbitration Decisions.

Unless otherwise agreed by the Parties, the arbitrator(s) shall render a decision within

ninety (90) Calendar Days of appointment and shall notify the Parties in writing of such decision

and the reasons therefor. The arbitrator(s) shall be authorized only to interpret and apply the

provisions of this Agreement and shall have no power to modify or change any provision of this

Agreement in any manner. The decision of the arbitrator(s) shall be final and binding upon the

Parties, and judgment on the award may be entered in any court having jurisdiction. The

decision of the arbitrator(s) may be appealed solely on the grounds that the conduct of the

arbitrator(s), or the decision itself, violated the standards set forth in the Federal Arbitration Act

or the Administrative Dispute Resolution Act. The final decision of the arbitrator must also be

SERVICE AGREEMENT NO. 1668

filed with FERC if it affects jurisdictional rates, terms and conditions of service, Attachment

Facilities, or System Upgrade Facilities, System Deliverability Upgrades.

27.4 Costs.

Each Party shall be responsible for its own costs incurred during the arbitration process

and for the following costs, if applicable: (1) the cost of the arbitrator chosen by the Party to sit

on the three member panel; or (2) one-third the cost of the single arbitrator jointly chosen by the

Parties.

27.5 Termination.

Notwithstanding the provisions of this Article 27, any Party may terminate this

Agreement in accordance with its provisions or pursuant to an action at law or equity. The issue

of whether such a termination is proper shall not be considered a Dispute hereunder.

ARTICLE 28. REPRESENTATIONS, WARRANTIES AND COVENANTS

28.1 General.

Each Party makes the following representations, warranties and covenants:

28.1.1 Good Standing.

Such Party is duly organized, validly existing and in good standing under the laws of the

state in which it is organized, formed, or incorporated, as applicable; that it is qualified to do

business in the state or states in which the Large Generating Facility, Attachment Facilities and

System Upgrade Facilities and System Deliverability Upgrades owned by such Party, as

applicable, are located; and that it has the corporate power and authority to own its properties, to

carry on its business as now being conducted and to enter into this Agreement and carry out the

transactions contemplated hereby and perform and carry out all covenants and obligations on its

part to be performed under and pursuant to this Agreement.

28.1.2 Authority.

Such Party has the right, power and authority to enter into this Agreement, to become a

Party hereto and to perform its obligations hereunder. This Agreement is a legal, valid and

binding obligation of such Party, enforceable against such Party in accordance with its terms,

except as the enforceability thereof may be limited by applicable bankruptcy, insolvency,

reorganization or other similar laws affecting creditors’ rights generally and by general equitable

principles (regardless of whether enforceability is sought in a proceeding in equity or at law).

28.1.3 No Conflict.

The execution, delivery and performance of this Agreement does not violate or conflict

with the organizational or formation documents, or bylaws or operating agreement, of such

Party, or any judgment, license, permit, order, or, except as described in Section 2(g) of

SERVICE AGREEMENT NO. 1668

Appendix C, any material agreement or instrument applicable to or binding upon such Party or

any of its assets.

28.1.4 Consent and Approval.

Such Party has sought or obtained, or, in accordance with this Agreement will seek or

obtain, each consent, approval, authorization, order, or acceptance by any Governmental

Authority in connection with the execution, delivery and performance of this Agreement, and it

will provide to any Governmental Authority notice of any actions under this Agreement that are

required by Applicable Laws and Regulations.

ARTICLE 29. MISCELLANEOUS

29.1 Binding Effect.

This Agreement and the rights and obligations hereof, shall be binding upon and shall

inure to the benefit of the successors and permitted assigns of the Parties hereto.

29.2 Conflicts.

If there is a discrepancy or conflict between or among the terms and conditions of this

cover agreement and the Appendices hereto, the terms and conditions of this cover agreement

shall be given precedence over the Appendices, except as otherwise expressly agreed to in

writing by the Parties. As permitted by the foregoing, the Parties expressly agree that the terms

and conditions of the Appendices shall take precedence over the provisions of this cover

agreement in case of a discrepancy or conflict between or among the terms and conditions of

same.

29.3 Rules of Interpretation.

This Agreement, unless a clear contrary intention appears, shall be construed and

interpreted as follows: (1) the singular number includes the plural number and vice versa; (2)

reference to any person includes such person’s successors and assigns but, in the case of a Party,

only if such successors and assigns are permitted by this Agreement, and reference to a person in

a particular capacity excludes such person in any other capacity or individually; (3) reference to

any agreement (including this Agreement), document, instrument or tariff means such

agreement, document, instrument, or tariff as amended or modified and in effect from time to

time in accordance with the terms thereof and, if applicable, the terms hereof; (4) reference to

any Applicable Laws and Regulations means such Applicable Laws and Regulations as

amended, modified, codified, or reenacted, in whole or in part, and in effect from time to time,

including, if applicable, rules and regulations promulgated thereunder; (5) unless expressly stated

otherwise, reference to any Article, Section or Appendix means such Article of this Agreement

or such Appendix to this Agreement, or such Section to the Standard Large Facility

Interconnection Procedures or such Appendix to the Standard Large Facility Interconnection

Procedures, as the case may be; (6) “hereunder”, “hereof’, “herein”, “hereto” and words of

similar import shall be deemed references to this Agreement as a whole and not to any particular

Article or other provision hereof or thereof; (7) “including” (and with correlative meaning

“include”) means including without limiting the generality of any description preceding such

SERVICE AGREEMENT NO. 1668

term; and (8) relative to the determination of any period of time, “from” means “from and

including”, “to” means “to but excluding” and “through” means “through and including”.

29.4 Compliance.

Each Party shall perform its obligations under this Agreement in accordance with

Applicable Laws and Regulations, Applicable Reliability Standards, the ISO OATT and Good

Utility Practice. To the extent a Party is required or prevented or limited in taking any action by

such regulations and standards, such Party shall not be deemed to be in Breach of this Agreement

for its compliance therewith. When any Party becomes aware of such a situation, it shall notify

the other Parties promptly so that the Parties can discuss the amendment to this Agreement that is

appropriate under the circumstances.

29.5 Joint and Several Obligations.

Except as otherwise stated herein, the obligations of NYISO, Developer and Connecting

Transmission Owner are several, and are neither joint nor joint and several.

29.6 Entire Agreement.

Except as described in Section 2(g) of Appendix C, this Agreement, including all

Appendices and Schedules attached hereto, constitutes the entire agreement between the Parties

with reference to the subject matter hereof, and supersedes all prior and contemporaneous

understandings or agreements, oral or written, between the Parties with respect to the subject

matter of this Agreement. There are no other agreements, representations, warranties, or

covenants which constitute any part of the consideration for, or any condition to, either Party’s

compliance with its obligations under this Agreement.

Notwithstanding the foregoing, the following agreement entered into by Connecting

Transmission Owner and Developer prior to this Agreement (as the same may be amended,

supplemented or modified from time to time) shall be preserved and continue in full force and

effect in accordance with its terms: Easement Grant dated August 6, 2010, Master Agreement

dated August 29, 2008, Transaction Form 3 dated August 28, 2009, and Transaction Form dated

September 22, 2017.

29.7 No Third Party Beneficiaries.

This Agreement is not intended to and does not create rights, remedies, or benefits of any

character whatsoever in favor of any persons, corporations, associations, or entities other than the

Parties, and the obligations herein assumed are solely for the use and benefit of the Parties, their

successors in interest and permitted their assigns.

29.8 Waiver.

The failure of a Party to this Agreement to insist, on any occasion, upon strict

performance of any provision of this Agreement will not be considered a waiver of any

obligation, right, or duty of, or imposed upon, such Party. Any waiver at any time by either

Party of its rights with respect to this Agreement shall not be deemed a continuing waiver or a

SERVICE AGREEMENT NO. 1668

waiver with respect to any other failure to comply with any other obligation, right, duty of this

Agreement. Termination or Default of this Agreement for any reason by the Developer shall not

constitute a waiver of the Developer’s legal rights to obtain Capacity Resource Interconnection

Service and Energy Resource Interconnection Service from the NYISO and Connecting

Transmission Owner in accordance with the provisions of the ISO OATT. Any waiver of this

Agreement shall, if requested, be provided in writing.

29.9 Headings.

The descriptive headings of the various Articles of this Agreement have been inserted for

convenience of reference only and are of no significance in the interpretation or construction of

this Agreement.

29.10 Multiple Counterparts.

This Agreement may be executed in two or more counterparts, each of which is deemed

an original but all constitute one and the same instrument.

29.11 Amendment.

The Parties may by mutual agreement amend this Agreement, by a written instrument

duly executed by all three of the Parties.

29.12 Modification by the Parties.

The Parties may by mutual agreement amend the Appendices to this Agreement, by a

written instrument duly executed by all three of the Parties. Such an amendment shall become

effective and a part of this Agreement upon satisfaction of all Applicable Laws and Regulations.

29.13 Reservation of Rights.

NYISO and Connecting Transmission Owner shall have the right to make unilateral

filings with FERC to modify this Agreement with respect to any rates, terms and conditions,

charges, classifications of service, rule or regulation under section 205 or any other applicable

provision of the Federal Power Act and FERC’s rules and regulations thereunder, and Developer

shall have the right to make a unilateral filing with FERC to modify this Agreement pursuant to

section 206 or any other applicable provision of the Federal Power Act and FERC’s rules and

regulations thereunder; provided that each Party shall have the right to protest any such filing by

another Party and to participate fully in any proceeding before FERC in which such

modifications may be considered. Nothing in this Agreement shall limit the rights of the Parties

or of FERC under sections 205 or 206 of the Federal Power Act and FERC’s rules and

regulations thereunder, except to the extent that the Parties otherwise mutually agree as provided

herein.

29.14 No Partnership.

This Agreement shall not be interpreted or construed to create an association, joint

venture, agency relationship, or partnership among the Parties or to impose any partnership

SERVICE AGREEMENT NO. 1668

obligation or partnership liability upon any Party. No Party shall have any right, power or

authority to enter into any agreement or undertaking for, or act on behalf of, or to act as or be an

agent or representative of, or to otherwise bind, any other Party.

29.15 Other Transmission Rights.

Notwithstanding any other provision of this Agreement, nothing herein shall be construed

as relinquishing or foreclosing any rights, including but not limited to firm transmission rights,

capacity rights, or transmission congestion rights that the Developer shall be entitled to, now or

in the future under any other agreement or tariff as a result of, or otherwise associated with, the

transmission capacity, if any, created by the System Upgrade Facilities and System

Deliverability Upgrades.

SERVICE AGREEMENT NO. 1668

IN WITNESS WHEREOF, the Parties have executed this LGIA in duplicate originals, each of

which shall constitute and be an original effective Agreement between the Parties.

NYISO

By:

Zachary G. Smith

Title: Vice President, System and Resource Planning

Date: _______________________________

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.

By:

Walter Alvarado

Title: Vice President, System and Transmission Operations

Date: _______________________________

BAYONNE ENERGY CENTER, LLC

Michael Gregg

Title: President & CEO

Date: _______________________________

SERVICE AGREEMENT NO. 1668

APPENDICES

Appendix A

Attachment Facilities and System Upgrade Facilities

Appendix B

Milestones

Appendix C

Interconnection Details

Appendix D

Security Arrangements Details

Appendix E

Commercial Operation Date

Appendix F

Addresses for Delivery of Notices and Billings

Appendix G

Connecting Transmission Owner and Developer Additional Agreements

SERVICE AGREEMENT NO. 1668

A-1

APPENDIX A

ATTACHMENT FACILITIES AND SYSTEM UPGRADE FACILITIES

1. Attachment Facilities:

(a) Developer’s Attachment Facilities (“DAF”):

(1) Existing DAF

The Developer has constructed a nominal 512 MW multi-unit, simple-cycle natural gas-

fired Large Generating Facility located in Bayonne, New Jersey (“BEC I”). BEC I

achieved commercial operation on June 1, 2012. BEC I is capable of producing up to

500 MW of summer net output and up to 512 MW of winter net output (see Appendix C

for more precise details).

The existing DAF associated with BEC I consist of the following: (i) approximately 6.75

miles of a single circuit, three-phase, 345 kV solid dielectric cable extending from the

Large Generating Facility in Bayonne, New Jersey, to and including the potheads to be

used by Developer in the Gowanus Substation; (ii) all terminations, splices and

appurtenances as necessary to connect the cable to the CTOAFs; (iii) an interface cabinet,

containing fiber optic and cable monitoring equipment, raceways, and terminations; and

(iv) two physically separate communications routes in accordance with the Connecting

Transmission Owner’s design specification.

As depicted in Figure A-1 to this Appendix A, the existing DAF associated with BEC I

include the following equipment, all of which have been completed:

• A 138 kV five breaker ring bus, 345-138 kV step up transformer, and 345 kV

circuit breaker to facilitate connection of each generator step-up transformer

(“GSU”) to the transmission cable leading to Gowanus substation;

• One (1) three-phase, two winding, 138/345 kV delta-wye step-up transformer

rated 366/488/610 MVA (ONAN/ODAF/ODAF), with specified impedance of

14.5% @ 366 MVA;

• Four (4) three-phase, three winding, 138/13.8 kV/13.8 kV wye-delta-delta, GSU

transformers rated 96/128/160 MVA (ONAN/ONAF/ONAF), with specified

impedance of 9% @96 MVA;

• Two (2) three-phase, two winding, 13.8-4.16 kV delta-wye, Unit Auxiliary

transformers rated 12/16 MVA (ONAN/ONAF), with specified impedance of

6.5% @ 12 MVA;

• One (1) SF6 345 kV 3000 A, 63 kA, circuit breaker;

• Five (5) SF6 138 kV 3000 A, 63 kA, circuit breakers;

SERVICE AGREEMENT NO. 1668

A-2

• Eight (8) vacuum 13.8 kV 4000A, 63 kA circuit breakers;

• One (1) 345 kV, 3000A, three-phase manual/group operated disconnect switch;

• Ten (10) 138 kV, 3000A, three-phase manual/group operated disconnect

switches;

• Four (4) 138 kV, 1600A, three-phase manual/group operated disconnect switches;

• Three (3) 253 kV maximum continuous operating voltage (“MCOV”) surge

arrestors on the incoming line at Bayonne Switchyard;

• Three (3) 253 kV MCOV surge arrestors on the step-up transformer primary;

• Three (3) 98 kV MCOV surge arrestors on the step-up transformer secondary;

• Twelve (12) 98 kV MCOV surge arrestors on the GSU primaries;

• Twenty-Four (24) 15 kV MCOV surge arrestors on the generator circuit breaker

line side;

• Bus structures, bus conductor, and associated foundations;

• Communications and Monitoring- Remote Terminal Unit (“RTU”) and redundant

communications to Con Edison’s Primary Energy Control Center (“ECC”) and

Alternate Energy Control Center (“AECC”), automatic ring down phone to Con

Edison’s ECC and RTU-RTU communications between BEC and Gowanus for

limited local status and information;

• Metering/Equipment - revenue metering will be located in Gowanus Substation

on the incoming G27 cable connection;

• Protection Systems - Interfaces with GSU protection, bus protection, 345-138 kV

transformer protection (NPCC Bulk Power System compliant) and G27 cable

protection (also interface with Gowanus end) (NPCC Bulk Power System

compliant);

• 345kV Lines (submarine and underground cables) 6.75 mile, 345 kV

land/submarine cable line between Bayonne and Gowanus substations; Land

cable is 3000kCmil Cu XLPE; submarine cable is 1750 kCmil Cu XLPE;

• Concrete encased duct banks;

• Fiber optic cables and associated interface cabinets; and

• 345kV pothead and associated terminal facilities.

SERVICE AGREEMENT NO. 1668

A-3

(2) New DAF

The Developer is adding two Siemens Trent 60 combustion turbine generators capable of

generating a nominal output of 132 MW (collectively “BEC II”). BEC II is described in

greater detail in Appendix C. As depicted in Figure A-2 to this Appendix A, the new DAFs

associated with BEC II include the following equipment:

• One (1) 345 kV, 3000A, three-pole, motor-operated station disconnect switch,

with manually-operated station-side grounding switch;

• Two (2) 345 kV, 3000A, 63 kA, three-pole independently-operated, high-voltage

circuit breakers, with pre-insertion closing resistors;

• One (1) 345 kV three-phase set of MOV surge arresters, 245 kV MCOV, 312 kV

duty cycle, installed on the line-side of the station disconnect switch;

• Three (3) 345 kV, 3000A, three-pole, motor-operated breaker disconnect

switches, without manually-operated grounding switches;

• One (1) 345 kV, 3000A, three-pole, motor-operated breaker disconnect switch,

with manually-operated GSU-side grounding switch;

• Two (2) 345 kV, 3000A, three-pole, motor-operated equipment disconnect

switches, with manually-operated equipment-side grounding switches, to isolate

345 kV shunt capacitor and shunt reactor banks;

• One (1) 345 kV, 650A reactor switching device, Southern States RLSwitcher for

operational switching of 345 kV shunt reactor bank;

• One (3) 345 kV, 45 MVar, shunt capacitor bank, with fuseless capacitor units, and

0.905 Ohms inrush current limiting reactors;

• One (1) 345 kV, 110 MVar, 1081 Ohms, shunt reactor bank, comprised of three

(3) single-phase units mounted on a common base with a common conservator oil

preservation system, and high-side Metal Oxide Varistor (“MOV”) surge

arresters, 245 kV MCOV, 312 kV duty cycle;

• One (1) three-phase, three-winding, generator step-up transformer, 13.8-13.8-

345Y/199.2 kV, 96/128/160 MVA (ONAN/ONAF/ONAF) grounded-wye HV

winding set, two (2) 48/64/80 MVA (ONAN/ONAF/ONAF) delta-connected LV

winding sets, Z=9%, X/R= 30, and high-side MOV surge arresters, 245 kV

MCOV, 312 kV duty cycle;

• Six (6) 345 kV capacitor voltage transformers, 1800/3000:1:1, 0.3% accuracy @

Z burden, 8100 pF capacitance-to-ground;

SERVICE AGREEMENT NO. 1668

A-4

• Three (3) 345 kV capacitor voltage transformers, 1800/3000:1:1:1, 0.3% accuracy

@ Z burden, 8100 pF capacitance-to-ground, third VT secondary used for revenue

metering;

• Three (3) 345 kV current revenue metering transformers, 2000:5, 0.3% accuracy

@ B1.8 burden;

• 345 kV tubular and suspension interconnecting buswork;

• 345 kV equipment and bus supporting structures, HSS galvanized tubular steel;

• Spread footing foundations;

• Shunt reactor oil retention and containment; and

• Prefabricated control enclosure with AC and DC station service systems for 345

kV switchyard equipment.

(b) Connecting Transmission Owner’s Attachment Facilities (“CTOAF”)

The Point of Change of Ownership (“PCO”) and Point of Interconnection (“POI”) are

designated on Figures A-1 & A-2.

(1) Existing CTOAF

The existing CTOAF associated with BEC I are depicted on Figure A-1 to this Appendix

A and consist of the following equipment located between the PCO and POI, all of which

have been completed:

• One (1) - 345 kV, 3000 A motor-operated disconnect switch and 345 kV

grounding switch;

• Grounding materials;

• 345kV bus work located between the potheads and the ring bus;

• 345kV bus structures located between the potheads and the ring bus;

• Three (3) coupling capacitor voltage transformers;

• Three (3) surge arresters; and

• Metering units (combination current transformer (“CT”) and voltage

transformer (“VT”) -- three (3) 345 kV, revenue quality, including support

structure, foundation and associated grounding for metering Developer-

delivered power.

SERVICE AGREEMENT NO. 1668

A-5

(2) New CTOAF

The CTOAFs required for BEC II, if any, will be identified in the Class Year

Interconnection Facilities Study for Class Year 2017.

2. System Upgrade Facilities (“SUFs”)

Prior to the interconnection of BEC I, Connecting Transmission Owner’s Gowanus 345kV

substation was configured as two air-insulated buses, known as a North Bus and South Bus,

each with a circuit breaker, transformer, phase angle regulator (“PAR”), shunt reactor and

three feeder circuit connections. The two buses were electrically independent of each other

and are not interconnected. Circuit breaker 2, transformer 2, PAR R2 and shunt reactor R6

were located on the North Bus with connections to Farragut Substation (feeder 41T),

Goethals Substation (feeder 25) and Greenwood Substation (feeder 42231). Circuit breaker

14, transformer 14, PAR R14 and shunt reactor R18 are located on the South Bus with

connections to Farragut Substation (feeder 42T), Goethals Substation (feeder 26) and

Greenwood Substation (feeder 42232).

(a) Stand-Alone System Upgrade Facilities (“Stand-Alone SUFs”)

(1) Existing Stand-Alone SUFs

The existing Stand-Alone SUFs identified under this Agreement for BEC I are located

within the Gowanus Substation and have all been completed. As required by the

interconnection of BEC I, the Gowanus Substation was reconfigured to an eight breaker

ring bus, as shown in Figure A-1 to Appendix A, to accommodate the interconnection of

BEC I. The design basis for the Gowanus Substation is a double ring configuration, with

each ring having 12 breakers. The ring bus configuration required the addition of six (6)

circuit breakers, associated disconnect switches, buswork, protection devices, and

associated structures.

The existing Stand-Alone SUFs consist of the following major electrical and physical

equipment:

• Six (6) 362kV, 3000A, 63kA, dead tank, SF6 circuit breakers with pre-insertion

resistors;

• Eighteen (18) 345 kV, 3000 A, three-phase, motor operated disconnect switches

with manually operated ground blades, including ground switches, support

structure, foundation, and associated grounding;

• Twenty-one (21) 345 kV Coupling Capacitor Voltage Transformers;

• Thirty (30) 345 kV station class surge arresters, including support structures,

foundations, and hardware;

• Ten (10) bus sections including support structures, foundations, and hardware;

SERVICE AGREEMENT NO. 1668

A-6

• Electrical relocation of Shunt Reactor R6 and R18 connections to bus positions

associated with feeders 41 and 42, respectively, including installation of one (1)

345kV, 3000A three-phase motor operated disconnect switch; (this is in addition to

the 19 disconnect switches listed above under CTOAFs and Stand-Alone SUFs,

making a total of 20 disconnect switches for the entire project, plus any identified

from detailed engineering);

• One (1) control building in the substation yard; the Control Building will include

the following main areas and equipment systems:

 control room,

 new station automation control system,

 Protective System Test (“PST”) room,

 two (2) relay protection rooms,

 thirty-two (32) new protection panels and associated equipment for two (2)

lines of NPCC bulk power system protection (where required),

 two (2) battery rooms,

 two (2) rectifier areas,

 two (2) electrical rooms, including two (2) A/C load boards, and two (2)

DC load boards,

 security system room,

 building fire detection and station security system,

 two (2) communication rooms, and

 HVAC systems, including Building Management System (“BMS”);

• One (1) lightning protection system;

• One (1) grounding system; and

• Protective Relay Equipment: relay protection equipment at the Gowanus

Substation for purposes of interconnecting the Large Generating Facility and

controlling flows to adjacent substations, including:

 two (2) fully independent and physically separated lines of protection,

SERVICE AGREEMENT NO. 1668

A-7

 one (1) line 1 protection system with hard-wired CT and potential

transformer (“PT”) connections between devices in the yard and the control

house, and relays,

 one (1) line 2 protection system with fully functional implementation of

IEC 61850 communication and relays, including a Hard Fiber Process Bus

System with Bricks, fiber interface cabinets, and an Air Blown Fiber system,

 one (1) Digital Fault Recorder, and

 equipment for communication with remote end relays at Goethals and

Farragut, consisting of two (2) RFL IMUX units and two (2) RFL GARD

8000 units.

(2) New Stand-Alone SUFs

The Stand Alone SUFs required for BEC II, if any, will be identified in the

Class Year Interconnection Facilities Study for Class Year 2017.

(b) Other System Upgrade Facilities (“Other SUFs”)

(1) Existing Other SUFs

The existing Other System Upgrade Facilities (“Other SUFs”) identified under this

Agreement for BEC I are located at Connecting Transmission Owner’s Goethals and

Farragut substations and have all been completed. The existing SUFs include the following

relay protection equipment:

Farragut

First Line Protection:

• The existing LCB II relay was replaced with a new relay matching what was

installed on feeder 41 at Gowanus;

• The existing LCB II relay was replaced with a new relay matching what was

installed on feeder 42 at Gowanus;

• Mounting plates were used if needed to interface new relays with existing panel

cutouts; and

• Relay replacements were made on existing panels and interface with existing

panel wiring.

Second Line Protection:

• The existing DLS relay were replaced with a new relay matching what was

installed on feeder 41 at Gowanus;

SERVICE AGREEMENT NO. 1668

A-8

• Existing DLS relay were replaced with a new relay matching what was installed

on feeder 42 at Gowanus;

• Mounting plates were used if needed to interface new relays with existing panel

cutouts; and

• Relay replacements were made on existing panels and interface with existing

panel wiring.

Common:

• Common RFL equipment was retrofitted in the Route #1 and Route #2 audio tone

cabinets.

Goethals

First Line Protection:

• The existing LCB II relay was replaced with a new relay matching what was

installed on feeder 25 at Gowanus;

• The existing LCB II relay was replaced with a new relay matching what was

installed on feeder 26 at Gowanus;

• Mounting plates were used if needed to interface new relays with existing panel

cutouts; and

• Relay replacements were made on existing panels and interface with existing

panel wiring.

Second Line Protection:

• The existing DLS relay was replaced with a new relay matching what was

installed on feeder 25 at Gowanus;

• The existing DLS relay was replaced with a new relay matching what was

installed on feeder 26 at Gowanus;

• Mounting plates were used if needed to interface new relays with existing panel

cutouts; and

• Relay replacements were made on existing panels and interface with existing

panel wiring.

Common:

• Common RFL equipment were retrofitted in the Route #1 and Route #2 audio

tone cabinets.

SERVICE AGREEMENT NO. 1668

A-9

(2) New Other SUFs

As part of BEC II, the relay protection and control equipment installed for FDR G27 for

BEC I will be modified. The new protection scheme will include conversion to a three-

terminal line differential scheme and updated relay settings, firmware and programing.

Additional Other SUFs required for BEC II, if any, will be identified in the Class Year

Interconnection Facilities Study for Class Year 2017.

3. System Deliverability Upgrades

The System Deliverability Upgrades (“SDUs”) required for BEC II, if any, will be

identified in the Class Year Interconnection Facilities Study for Class Year 2017.

4. Cost Estimates

BEC II is a member of Class Year 2017, which has not been completed. A final cost

estimate will be reported in the final Class Year 2017 Interconnection Facilities Study. The

costs estimates for associated relay protection work will be contained in the final results of

the Class Year 2017 Interconnection Facilities Study.

5. Required Additional Facilities and Conditions to Operations

a. At the request of Developer, this Agreement was executed prior to the completion of the

Class Year 2017 Interconnection Facilities Study. As a result, the interconnection and operation of

BEC II may require the construction of CTOAFs, Stand-Alone SUFs, Other SUFs, and SDUs in

addition to the facilities identified in this Appendix A. Developer agrees that it will accept its

Project Cost Allocation for any required SUFs identified for its project in the Class Year 2017

Interconnection Facilities Study and will post the related Security or payments in accordance with

the applicable provisions in Attachment S of the NYISO OATT. Developer further agrees that by

accepting its Project Cost Allocation, it accepts its responsibility for its pro rata share determined

in the Class Year Study of the Other Upgrade described in Section 5(c) below

If the CTOAFs, Stand-Alone SUFs, Other SUFs, or SDUs for BEC II identified in the

Class Year 2017 Interconnection Facilities Study differ in any material way from the facilities

identified in the Appendices to this Agreement, the Parties shall amend this Agreement after

Developer has accepted its Project Cost Allocation for Class Year 2017, pursuant to Articles 29.11

and 29.12, to reflect such facilities, the responsibility to design, engineer, procure and construct

such facilities, and any necessary cost responsibility and security requirements, as agreed to by

Connecting Transmission Owner and Developer.

b. Developer may not supply Unforced Capacity to the New York Control Area from BEC

II until Developer has complied with the deliverability requirement pursuant to applicable

provisions of Attachment S of the NYISO OATT, including acceptance of any cost allocation for

SDUs and the posting of associated security or payments.

SERVICE AGREEMENT NO. 1668

A-10

c. Preliminary studies for the Class Year 2017 Interconnection Facilities Study have

identified an “Other Upgrade” for BEC II. It is anticipated that the Other Upgrade would resolve a

short circuit issue that is created if another project, TDI-USA Holdings, Inc.’s (“TDI”) Champlain

Hudson Power Express (Queue No. 458), enters into service. The Developer, TDI, and/or other

Class Year 2017 developers whose projects contribute to the need for this Other Upgrade would

enter into an engineering, procurement, and construction agreement for the construction of the

upgrade.

d. At the request of the Developer in accordance with Section 30.12.3 of Attachment X of

the NYISO OATT, the NYISO has performed, in conjunction with the CTO, a limited operation

study at the expense of Developer to determine whether and the extent to which BEC II may go in

service and operate following the Initial Synchronization Date at maximum generating capability

(or at some lower capability) prior to the completion of any required CTOAFs, SUFs, and Other

Upgrades consistent with Applicable Laws and Regulations, Applicable Reliability Standards, Good

Utility Practice, and this Agreement. The Connecting Transmission Owner and the NYISO shall

permit Developer to operate BEC II in accordance with the results of such studies and the NYISO’s

testing procedures and requirements. This limited operation period will end upon the earliest of the

following: (i) the completion of all required System Upgrade Facilities and Other Upgrade, (ii)

TDI’s rejection of or failure to timely post Security for its SUF Project Cost Allocation for Class

Year 2017, or (iii) termination of the TDI project.

SERVICE AGREEMENT NO. 1668

A-11

Figure A-1

BEC I One-Line Diagram

[CONTAINS CEII – THIS PAGE REMOVED FROM PUBLIC VERSION]

SERVICE AGREEMENT NO. 1668

A-12

FIGURE A-2

BEC II ONE-LINE DIAGRAM

[CONTAINS CEII – THIS PAGE REMOVED FROM PUBLIC VERSION]

SERVICE AGREEMENT NO. 1668

B-1

APPENDIX B

MILESTONES

1. Selected Option Pursuant to Article 5.1

Developer has elected the Option to Build under Article 5.1.3 of the Agreement to the

extent any additional CTOAFs, SUFs or SDUs are identified as a result of the NYISO

Class Year 2017 Interconnection Facilities Study except as otherwise agreed by the

Connecting Transmission Owner and Developer and memorialized in Appendix A.

2. Milestones (BEC I)

BEC I is operational and the milestones for the construction and interconnection of BEC I

have all been completed.

3. Milestones (BEC II)

The following milestones shall apply to the construction and interconnection of BEC II.

With the exception of the In-Service Date and Commercial Operation Date, the times

projected for the milestones are non-binding estimates. The In-Service Date and

Commercial Operations Date can only be extended in accordance with the requirements

set forth in Attachment X of the NYISO OATT. The actual dates for completion of the

milestones are highly dependent upon lead times for the procurement of equipment and

material, the availability of labor, outage scheduling, receipt of regulatory approvals, and

the results of equipment testing. The completion and results of the NYISO Class Year

2017 Interconnection Facilities Study, environmental remediation of the site, and other

unforeseen events could also affect the achievement of the milestones.

Item

Milestone

Due Date

Responsible Party

Notice to Proceed from Developer to

commence certain engineering and

procurement activities per the Engineering

and Procurement Agreement

Completed

Developer

Submit proof of insurance coverage in

accordance with Article 18.3 of this

Agreement

No later than 10

days after

execution of this

Agreement

Developer

Completion of engineering packages for

the CTOAF and SUF – Relay Changes at

Gowanus

February 28,

2018

Connecting

Transmission

Owner

Submittal of initial, updated, and final

specifications for the DAF (including

System Protection Facilities) shall be as

provided in Section 5.10.1 of this

Agreement, unless the Parties agree

March 1, 2018

Developer

SERVICE AGREEMENT NO. 1668

B-2

otherwise.

Complete development of Pre-

Energization Checklist Form, including

procedures for Trial Operation. Items on

checklist must be completed prior to Initial

Synchronization Date for each Generating

Facility unit

March 1, 2018

Developer and

Connecting

Transmission

Owner

Completion of SUF – Relay Changes at

Gowanus

April 15, 2018

Connecting

Transmission

Owner

In-Service Date Limited Operations

May 15, 2018

Developer

Initial Synchronization Date (if Trial

Operation is permitted without fully

completed SUFs)

May 23, 2018

Developer

Initial Synchronization Date (if Trial

Operation is not permitted without fully

completed SUFs)

TBD

Developer

10.

Complete testing of Generating Facility

and SUF

May 30, 2018

Developer and

Connecting

Transmission

Owner

11.

Commercial Operation Date

June 16, 2018

Developer

12.

Submit “as-built” drawings, information

and vendor test documents for DAF,

CTOAF and SUF and Large Generating

Facility to Connecting Transmission

Owner.

August 15, 2018

Developer and

Connecting

Transmission

Owner (if required)

SERVICE AGREEMENT NO. 1668

C-1

APPENDIX C

INTERCONNECTION DETAILS

1. Description of the Large Generating Facility including Point of Interconnection

BEC I and BEC II are located in Bayonne, New Jersey. BEC I and BEC II both have the

same Point-of-Interconnection (“POI”) at Con Edison’s 345kV Gowanus substation

(between ring bus breakers #20 & #22) see Figures A-1 and A-2 of Appendix A.

(a) BEC I

BEC I is a nominal 512 MW multi-unit, simple-cycle natural gas-fired (with ultra-low

sulfur diesel oil as a backup fuel) Large Generating Facility, capable of producing up to

500 MW of summer net output and up to 512 MW of winter net output (see next

paragraph and Figure C-1 for more precise outputs). BEC I achieved commercial

operation on June 1, 2012.

BEC I is temperature sensitive and has a maximum summer capability and a maximum

winter capability, as specified below, and as depicted in the temperature output curve set

forth below in Figure C-1, subject to the following limitation: that the Large Generating

Facility will not deliver to the Point of Interconnection in excess of 512 MW during the

Winter Capability Period and will not deliver to the Point of Interconnection in excess of

500 MW during the Summer Capability Period:

P summer max gross 61.22 MW x 8 = 489.76 MW @ 85°F (varies based on relative humidity)

P aux load 7.10 MW @ 85°F (varies based on gas line pressure and relative humidity)

P summer max net 482.66 MW @ 85°F

P winter max gross 63.56 MW x 8 = 508.48 MW @ 10°F (varies based on relative humidity)

P aux load 6.96 MW @ 10°F (varies based on gas line pressure and relative humidity)

P winter max net 501.5 MW @ 10°F

The above-described maximum capability is achieved using Inlet Spray Intercooling

(“ISI”). The ISI system provides staged inlet fogging and wet compression water streams

to the gas turbine air intake system which cools the compressor inlet air and increases

mass flow. The inlet fogging system uses metered inlet fogging water flow to control

inlet air conditions to a wet bulb temperature of 52 degrees Fahrenheit or a maximum

relative humidity of 92% by three fogging arrays in stages to provide maximum

flexibility and control over the ambient temperature range. The wet compression system

provides a metered wet compression water flow in three stages via spray rails mounted

forward of the gas turbine low pressure (“LP”) compressor.

BEC I consists of eight 64 MW (nominal 64 MW each) generating units connecting to a

138 kV ring bus via four 13.8-13.8-138 kV three winding step-up transformers (“GSU”).

SERVICE AGREEMENT NO. 1668

C-2

From the ring bus, power is delivered to the Connecting Transmission Owner’s Gowanus

345 kV Substation via a two winding, 138-345 kV switchyard step up transformer

(“SSU”) and a 6.75-mile, AC land/submarine cable. The Point of Interconnection is

between Breakers #20 and #22 of the 345kV ring bus developed at Gowanus as a result

of this project; see Figure A-1 of Appendix A. The Point of Change of Ownership is

downstream of the G27 cable pothead at the Gowanus substation; see Figure A-1 and

Figure A-2 of Appendix A. The major Equipment within BEC I includes:

• Eight (8) combustion turbine generator packages (“CTGs”): each unit consist of a

Rolls Royce Trent 60 Dual Fuel WLE Simple Cycle, Aero derivative combustion

turbine with a 2 pole, 60 Hz, Open Air Cooled Siemens Generator, rated at 75.3

MVA, 64 MW, .85 PF lagging (39.66 MVAR lagging) / .95 PF leading (21.04

MVAR leading), and operating at a nominal terminal voltage of 13.8 kV;

• CTG Step Up Transformers: four (4) three winding, three-phase, (delta-delta-wye)

transformers 13.8-13.8 kV-138 kV, 96/128/160 MVA (ONAN/ONAF/ONAF), and

specified impedance at 9%@96MVA; and

• Switchyard Step Up Transformer: one (1) two winding, three-phase, (delta-wye)

transformer 138-345 kV, 366/488/610 MVA (ONAN/ODAF/ODAF), and specified

impedance at 14.5%@366MVA.

(b) BEC II

BEC II is a nominal 132 MW multi-unit, simple-cycle natural gas-fired (with ultra-low

sulfur diesel oil as a backup fuel) Large Generating Facility, capable of producing up to

120.4 MW of summer net output and up to 129.4 MW of winter net output (see next

paragraph and Figure C-2 for more precise outputs).

BEC II is temperature sensitive and has a maximum summer capability and a maximum

winter capability, as specified below, and as depicted in the temperature output curve set

forth below in Figure C-2, subject to the following limitation: that the Large Generating

Facility will not deliver to the Point of Interconnection in excess of 129.4 MW during the

Winter Capability Period and will not deliver to the Point of Interconnection in excess of

120.4 MW during the Summer Capability Period:

P summer max gross 61.45 MW x 2 = 122.9 MW @ 85°F (varies based on relative humidity)

P aux load 2.53 MW @ 85°F (varies based on gas line pressure and relative humidity)

P summer max net 120.4 MW @ 85°F

P winter max gross 66.0 MW x 2 = 132.0 MW @ 10°F (varies based on relative humidity)

P aux load 2.64 MW @ 10°F (varies based on gas line pressure and relative humidity)

P winter max net 129.4 MW @ 10°F

SERVICE AGREEMENT NO. 1668

C-3