HomeMy WebLinkAboutResolution - 2758 - Energy Agreement - TTU - Cogeneration Project, & Steam & Electricity Sales - 02/25/1988DGV:da
RESOLUTION
Resolution #2758
February 25, 1988
Item 31
WHEREAS, it is the intention of the City Council of the City of
Lubbock to enter into an Energy Agreement with Texas Tech University and
Texas Tech University Health Sciences Center, both hereinafter called
the "University", whereby the City of Lubbock will construct and operate
an electrical and steam generation facility upon the campus of the
University for generation of electricity and steam for sale to the
University to the extent required by the University; and
WHEREAS, the University shall lease all necessary land on its
campus required for the construction of said facility to the City of
Lubbock; and
WHEREAS, such Energy Agreement shall have attached as exhibits a
Power Plant Construction Agreement, a Lease Agreement and a Utilities
and Steam Purchase Agreement; and
WHEREAS, time is of the essence in regard to said project; and
WHEREAS, the City Council of the City of Lubbock understands that
minor changes to said agreements may be required hereafter as a result
of requirements of the Texas Attorney General on behalf of the
University and recommendations of bond counsel on behalf of the City of
Lubbock; and
WHEREAS, the City Council of the City of Lubbock desires to enter
into said Energy Agreement with the University not withstanding such
minor modifications as may be hereafter required in order to commence
said project in a timely fashion; NOW THEREFORE:
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock BE and is hereby authorized
and directed to execute for and on behalf of the City of Lubbock an
Energy Agreement with Texas Tech University and Texas Tech University
Health Sciences Center following approval of such agreement as to final
form by legal counsel for the University and the City Attorney for the
City of Lubbock. Following final approval by legal counsel and
signature by all parties, such final agreement shall be substituted for
the draft agreement attached hereto and said final agreement shall
constitute and be a part of this Resolution as if fully copied herein in
detail.
Passed by the City Council this
ATTEST:
Ranet a Boyd, City Secr `ary
APPROVED AS TO CONTENT:
Carroll McDonald, Director of
Electric Utilities
-Z 164t9
25th day of February , 1988.
B. C. McMINN, MAYOR
Resolution #2758
February 25, 198P
ENERGY AGREEMENT
BETWEEN
TEXAS TECH UNIVERSITY
AND
TEXAS TECH UNIVERSITY HEALTH SCIENCES CENTER
AND
CITY OF LUBBOCK
AND
LUBBOCK POWER AND LIGHT
MARCH 21, 1988
ENERGY AGREEMENT
Table of Contents
Page
PREAMBLE . . . . . . . . . . . . . . . . . . . . . . . . . . 1
I. CONSTRUCTION AGREEMENT . . . . . . . . . . . . . 2
II. LEASE AGREEMENT . . . . . . . . . . . . . . . . . 3
III. UTILITIES AND STEAM PURCHASE AGREEMENT . 3
IV. INTEGRATION OF AGREEMENT . . . . . . . . . . . . 3
POWER PLANT CONSTRUCTION AGREEMENT EXHIBIT "A" . . . . . . . A-1
I. FACILITIES . . . . . . . . . . . . . . . . . . . A-2
A. Description of Facilities . . . . . . . . . A-2
B. Location . . . . . . . . . . . . . . . . . . A-2
C. Construction of Facilities . . . . . . . . . A•-2
1. Responsibilities of LP&L. . . . . . . . . A-2
2. Responsibilities of Texas Tech. . . . . . A-7
II. CONDITIONS OF PERFORMANCE. . . . . . . . . . . . A-8
III. ASSIGNMENT . . . . . . . . . . . . . . . . . . . A-9
IV. NO PARTNERSHIP, JOINT VENTURE
OR LENDING OF CREDIT INTENDED . . . . . . . A-10
V. INDEMNITY . . . . . . . . . . . . . . . . . . . . A-11
VI. ENTIRE AGREEMENT . . . . . . . . . . . . . . . . A-12
VII. APPLICABLE LAW . . . . . . . . . . . . . . . . . A-12
VIII. BINDING EFFECT . . . . . . . . . . . . . . . . . A-13
EXHIBIT A-1 -- GENERAL SITE LOCATION
LEASE AGREEMENT EXHIBIT "B" . . . . . . . . . . . . . . . . . B-1
I. LEASED PREMISES . . . . . . . . . . . . . . . . . B-1
i
I I .
TERM OF LEASE . . . . . . . . . . . . . .
. . . . B-2
I.
A. Lease Period . . . . . . . . . . . .
. . . . B-2
II.
B. Lease Commencement . . . . . . . . .
. . . . B-2
III.
USE OF PREMISES . . . . . . . . . . . . .
. . . . B-3
A. Purpose of Use . . . . . . . . . . .
. . . . B-3
B. Construction on Premises . . . . . .
. . . . B-3
C. Maintenance of Premises. . . . . . .
. . . . B-3
III.
D. Consideration . . . . . . . . . . . .
. . . . B-4
E. Surrender at Termination . . . . . .
. . . . B-4
IV.
CONDITIONS OF PERFORMANCE. . . . . . . .
. . . . B-5
V.
ASSIGNMENT AND SUBLETTING. . . . . . . .
. . . . B-6
VI.
OWNERSHIP UPON TERMINATION, ABANDONMENT,
OR SALE B-7
VII.
NO PARTNERSHIP, JOINT VENTURE
OR LENDING OF CREDIT INTENDED . .
. . . . .B-8
VIII.
INDEMNITY . . . . . . . . . . . . . . . .
. . . . B-8
IX.
ENTIRE AGREEMENT . . . . . . . . . . . .
. . . . B-9
X.
APPLICABLE LAW . . . . . . . . . . . . .
. . . . B-10
XI.
BINDING EFFECT . . . . . . . . . . . . .
. . . . B-10
EXHIBIT B-1 -- GENERAL SITE LOCATION
UTILITIES
AND STEAM PURCHASE AGREEMENT EXHIBIT "C"
C-1
I.
CONVERSION OF EXISTING DISTRIBUTION SYSTEM . .
. C-2
II.
COMBINATION OF EXISTING METERS . . . . . . . .
. C-2
A. Procedure and Billing. . . . . . . . . . .
. C-2
B. Effective Date . . . . . . . . . . . . . .
. C-3
C. Access to Premises . . . . . . . . . . . .
. C-4
C. Option as Separate Agreement . . . . . . .
. C-4
III.
ELECTRIC SERVICE AND STEAM . . . . . . . . . .
. C-4
A. Purchase . . . . . . . . . . . . . . . . .
. C-4
ii
B.
Term . . . . . . . . . . . . . . . . . . .
. C-5
C.
Price and Price Adjustment . . . . . . . .
. C-7
1. Electricity . . . . . . . . . . . . . .
. C-7
2. Steam . . . . . . . . . . . . . . . . .
. C-7
3. Prices Upon Expiration of Agreement. .
. C-9
D.
Steam Quality and Volume . . . . . . . . .
. C-10
E.
Water Replacement . . . . . . . . . . . . .
. C-10
F.
Metering . . . . . . . . . . . . . . . . .
. C-12
1. Steam . . . . . . . . . . . . . . . . .
. C-12
2. Condensate . . . . . . . . . . . . . .
. C-13
G.
Steam Availability . . . . . . . . . . . .
. C-14
H.
Payment . . . . . . . . . . . . . . . . . .
. C-14
I.
Availability of Funds to Purchase Steam. .
. C-14
IV. Suspension of Service . . . . . . . . . . . . .
. C-15
A.
Suspension by TEXAS TECH . . . . . . . . .
. C-15
B.
Suspension by LP&L . . . . . . . . . . . .
. C-16
C.
LP&L Right Upon Notice of Suspension . . .
. C--17
D.
Suspension and Reinstatement of Service. .
. C-17
E.
Lease of Distribution Lines and Facilities
Following Termination. . . . . . . . .
. C-18
F.
Cooperation Upon Suspension. . . . . . . .
. C-19
G.
Purchase of Lines and Facilities . . . . .
. C-19
H.
Suspension of Steam Obligation . . . . . .
. C-19
V. EASEMENTS . . . . . . . . . . . . . . . . . . . .
C-20
VI. FUEL
SUPPLY . . . . . . . . . . . . . . . . . . .
C-20
A.
Fuel Obligation . . . . . . . . . . . . . . .
C-20
B.
Natural Gas Pipeline . . . . . . . . . . . .
C-21
iii
VII. MODIFICATION OF TEXAS TECH'S EXISTING FACILITIES.0-22
VIII.
SERVICE AND RELIABILITY . . . . . . . . . . . . .
C-23
A. Responsibility for Human Needs . . . . . . .
C-23
B. Obligation for Increased Electric Service. .
C-23
C. Dedication of Power . . . . . . . . . . . . .
C-23
IX.
ASSIGNMENT . . . . . . . . . . . . . . . . . . .
C-24
X.
OWNERSHIP UPON TERMINATION, ABANDONMENT, OR SALE
C-24
XI.
NO PARTNERSHIP, JOINT VENTURE
OR LENDING OF CREDIT INTENDED . . . . .
C-25
XII.
PROHIBITIONS ON CERTAIN CONTRACTS. . . . . . . .
C-26
XIII.
INDEMNITY . . . . . . . . . . . . . . . . . . . .
C-26
XIV.
FORCE MAJEURE. . . . . . . . . . . . . . . . . .
C-27
XV.
ENTIRE AGREEMENT . . . . . . . . . . . . . . . .
C-27
XVI.
APPLICABLE LAW . . . . . . . . . . . . . . . . .
C-28
XVII.
BINDING EFFECT . . . . . . . . . . . . . . . . .
C-29
EXHIBIT C-1 LIST OF LP&L CUSTOMERS COMPARABLE TO TEXAS TECH
EXHIBIT C-2 STEAM RATES
EXHIBIT C-3 STEAM AVAILABILITY
1V
3-21-88
ENERGY AGREEMENT
Preamble
This Agreement made and entered into by and between
TEXAS TECH UNIVERSITY and TEXAS TECH UNIVERSITY HEALTH SCIENCES
CENTER, institutions of higher education of the State of Texas,
acting by and through their Board of Regents ("TEXAS TECH"), the
CITY OF LUBBOCK, a home rule municipal corporation ("CITY"), and
LUBBOCK POWER & LIGHT, a division of the CITY of Lubbock
("LP&L"), each acting by and through it's duly authorized
officials as follows:
WHEREAS, TEXAS TECH is an institution of higher
education whose government, control, and direction is vested in a
board of nine regents, and
WHEREAS, LP&L is a division of the CITY and the CITY is
ultimately responsible for all obligations incurred by LP&L, any
reference to LP&L shall also include the CITY, and
WHEREAS, LP&L presently serves a portion of the
electric power needs of TEXAS TECH, and
WHEREAS, TEXAS TECH owns certain existing 4,160 volt
power distribution lines and facilities located on its campus in
Lubbock, Texas, and
WHEREAS, LP&L owns certain existing 12,470 volt and
higher power distribution lines and facilities located on the
campus of TEXAS TECH in Lubbock, Texas, and
1
WHEREAS, TEXAS TECH owns a Central Heating and Cooling
Plant I located on its campus, which is utilized for providing
steam for heating and cooling purposes on the campus of TEXAS
TECH, and
WHEREAS, the CITY, through LP&L, desires to construct a
gas turbine electric generating plant and associated facilities
("Facilities") more specifically described in the Power Plant
Construction Agreement, which Facilities will be a part of the
electric power generation and transmission system owned and
operated by LP&L, on the campus of TEXAS TECH for the purpose of
serving the electric power needs of TEXAS TECH, as well as other
customers of LP&L, and
WHEREAS, the Facilities would produce steam as part of
the generation process which will be available for use through
the existing Central Heating and Cooling Plant I of TEXAS TECH,
and
WHEREAS, the Facilities are intended to provide
electricity (through LP&L's system) and steam to TEXAS TECH at
rates which are beneficial and are expected to continue to be
beneficial -to TEXAS TECH, the parties have agreed as follows:
Is
CONSTRUCTION AGREEMENT
The parties hereto have entered into a Power Plant
Construction Agreement ("Construction Agreement") which is
attached hereto and made a part hereof as Exhibit "A". Such
Construction Agreement shall become effective upon the occurence
of the Conditions of Performance as set forth in the Construction
Agreement.
2
II.
LEASE AGREEMENT
The parties hereto have entered into a Lease Agreement
between TEXAS TECH, as Lessor, and the CITY, through LP&L, as
Lessee, covering the site upon which the power plant portion of
Facilities are to be .located, such Lease Agreement is attached
hereto and made a part hereof as Exhibit "B". Such Lease
Agreement shall become effective as set forth in the Lease
Agreement.
UTILITIES AND STEAM PURCHASE AGREEMENT
The parties hereto have entered into a UTILITIES AND
STEAM PURCHASE AGREEMENT ("UTILITY AGREEMENT") which is attached
hereto and made a part hereof as Exhibit "C". Such UTILITY
AGREEMENT shall become effective as set forth in the UTILITY
AGREEMENT.
IV.
INTEGRATION OF AGREEMENT
The above-described Construction Agreement, Lease
Agreement, and Utility Agreement, attached hereto as Exhibits A,
B, and C, are integral parts of this Energy Agreement. Although
they have been separated for convenience, it is the intent of the
parties and a part of the consideration for execution of this
Agreement, and the execution of the three agreements attached as
exhibits, that the three agreements are neither severable nor
separately assignable.
3
That for and in consideration of the mutual benefits
to the parties hereto, it is mutually agreed as follows:
MADE AND ENTERED into this 25th day of Febru ary ,
1988 by:
ATTEST:
THE CITY OF LUBBOCK
C
By:
'Mayor
LUBBOCK POWER AND LIGHT
By: d."', Z'�'
Director
(Approved as to content)
Fay : C- I--
ttorney for LP9L
(Approved as to form)
TEXAS TECH UNIVERSITY
By: 'Okwzz� L
TEXAS TECH UNIVERSITY
HEALTH SCIENCES CENTER
4
EXHIBIT "A"
POWER PLANT CONSTRUCTION AGREEMENT
This Power Plant Construction Agreement, made and entered
into by TEXAS TECH UNIVERSITY and TEXAS TECH UNIVERSITY HEALTH
SCIENCES CENTER, institutions of higher education of the State of
Texas, acting by and through their Board of Regents (TEXAS TECH),
the CITY OF LUBBOCK, a home rule municipal corporation ("CITY")
and LUBBOCK POWER & LIGHT (LP&L), a division of the CITY OF
LUBBOCK, each acting through its duly authorized officials as
follows:
WHEREAS, the CITY and LP&L and TEXAS TECH have entered into
a Energy Agreement of the same date hereof, and
WHEREAS, as a part of such Energy Agreement, the CITY, LP&L,
and TEXAS TECH have agreed to certain terms and conditions, one
of which is to enter into a Power Plant Construction Agreement
("Construction Agreement") in order to effectuate the terms,
conditions, and intent of such Energy Agreement,
WHEREAS, for the purpose of evidencing the agreement and
intent of the parties concerning the construction, operation and
maintenance of the Facilities described below, the parties have
agreed as follows:
NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS,
That for and in consideration of the mutual benefits to the
parties hereto, it is mutually agreed that the CITY, through
LP&L, shall construct, own, maintain and operate the Facilities
described below upon the following agreements, terms and
conditions:
A-1
I.
FACILITIES
A. Description of Facilities:
The Facilities shall consist of a gas turbine electric
power generating plant consisting of a gas turbine generator
such as Model LM2500 generator, together with all buildings,
equipment, ancillary support facilities, transmission lines,
fuel pipelines, substation and other improvements necessary
'to operate such power plant as hereafter described.
B. Location:
The Facilities shall be located on a site, leased from
TEXAS TECH, to be specifically identified by survey, not to
exceed 252 feet in length and 192 feet in width adjacent to
the existing Central Heating and Cooling Plant I of TEXAS
TECH University and within the boundaries of the general site
.location shown in Exhibit A--1.
C. Construction of Facilities:
1. Insofar as the construction of the Facilities set forth
herein, the CITY, through LP&L, shall be responsible for
providing, at its sole expense, the following:
a. All engineering studies, drawings, plans and
specifications in connection with the Facilities.
LP&L shall be responsible for providing for the
construction of the Facilities, including
distribution facilities. The Facilities shall be
designed so that the noise level will meet industry
A-2
standards as set out by the National Electric
Machinery Association (NEMA) and so as to be
compatible in appearance and architectural design
with Texas Tech Central Heating and Cooling Plant I.
The appearance and architectural design shall be
subject to prior approval of TEXAS TECH. LP&L shall
be responsible for connecting the steam and
condensate lines between the Facilities and TEXAS
TECH's Central Heating And Cooling Plant I. These
connections shall be within five feet of the LP&L
leased property lines as defined on Exhibit A-1. All
new power distribution lines, water lines and gas
lines (except electric transmission lines to and from
the Facilities to serve areas outside the TEXAS TECH
campus) shall be underground.
b. The transmission lines connecting the Facilities with
the transmission system of LP&L serving areas other
than the TEXAS TECH Campus which shall be overhead
lines (unless otherwise elected by TEXAS TECH as
provided below), supported by painted steel poles.
TEXAS TECH reserves the right, during the term of the
Lease Agreement or Utilities Agreement, to require
that all transmission facilities be relocated
underground as hereinafter provided. If the decision
is made before construction begins, the decision must
be made before the execution of LP&L's construction
contract to build the Facilities and, in such event,
A-3
c.
M
the difference between the cost of placing the
transmission lines underground and the cost of
overhead lines shall be borne by TEXAS TECH. If, at
any other time, TEXAS TECH elects to have such
transmission lines relocated underground, TEXAS TECH
shall reimburse LP&L for the relocation costs
including the costs to remove any existing overhead
transmission lines constructed pursuant to this
agreement. In the event LP&L elects, at anytime,
without the request of TEXAS TECH, to locate or
relocate such transmission lines underground, LP&L
may do so, but at its sole cost, with permission of
TEXAS TECH.
All labor, equipment, material and services necessary
to construct, complete, maintain and operate the
Facilities.
All permits, .licenses and other actions required to
comply, now and in the future, with all requirements
of all local, state, and federal regulatory
authorities or commissions having jurisdiction. The
CITY, through LP&L, shall satisfy itself that all
approvals required in the Conditions of Performance
stated herein are all that are required to construct,
own, operate, and maintain the Facilities. The CITY
shall assume all risk and liability associated
therewith and agrees to indemnify and hold TEXAS TECH
harmless with respect to any such approvals and
Conditions of Performance, authorized or required by
A-4
e.
f.
law, including any approvals required of or from
TEXAS TECH. In the event TEXAS TECH is required to
obtain any such approvals LP&L shall notify TEXAS
TECH of same and TEXAS TECH will cooperate fully with
LP&L in obtaining same.
The CITY shall own all Facilities constructed and
paid for by the CITY on the leased premises pursuant
to this Agreement, subject to the termination, and
leasing and other rights of TEXAS TECH set out in
this Agreement.
The application process for all permits and licenses
and preparation of specifications, engineering
drawings, plans and designs which shall be commenced
by the CITY, through LP&L, within thirty (30) days
after the execution of this Agreement. The CITY,
through LP&L, shall diligently pursue the completion
of such plans from such commencement date. The
construction contract shall be let by the CITY
through LP&L within ninety (90) days from the
fulfillment of all Conditions of Performance set out
in Paragraph II of this Agreement including prior
approval by Tech of plans as to appearance and
architectural design. A construction schedule, not
to exceed twenty-four (24) months from the letting of
the construction contract to completion, shall be
furnished to Texas Tech by LP&L upon the letting of
the construction contract. Construction of the
A-5
Facilities shall begin as soon as possible from the
date of the letting of LP&L's Construction Contract.
There shall be included in all contracts regarding
the construction of the Facilities entered into by
the CITY, through LP&L, with third party contractors
and equipment suppliers, a liquidated damages clause
for failure to complete on schedule. The CITY,
through LP&L, shall diligently pursue completion of
the construction of said Facilities in accordance
with the construction schedule to be furnished by
LP&L to Texas Tech and shall complete the
construction of the Facilities within twenty-four
(24) months from the date of the letting of the
construction contract by the CITY, through LP&L. The
CITY through LP&L shall begin operation of the
facilities including the delivery of TEXAS TECH steam
requirements within sixty ( 60 ) days from the date of
completion of the Facilities.
g. In the event the CITY and LP&L fail to complete the
construction of the Facilities within the twenty-four
(24) month period or fail to begin operations of the
Facilities including the delivery of TEXAS TECH steam
requirements within the sixty (60) day period as
provided in Subparagraph f. above, then LP&L shall
pay to TEXAS TECH at Texas Tech's option $2000 per
day as liquidated damages for unexcused delay until
the Facilities are placed in operation and delivery
A-6
of TEXAS TECH steam requirements begin. It is agreed
that the $2,000.00 per day liquidated damages is a
remedy only for failure to complete construction and
begin operations within the specified time, applies
to no other breach of this contract, and shall not
affect any other remedies, including that of specific
performance, that TEXAS TECH may have for other
breaches of this contract, including the failure to
pursue diligently completion of construction and
commencement of operations of the Facilities, or
breaches of the LEASE AGREEMENT or the UTILITIES
AGREEMENT.
h. Notwithstanding anything to the contrary herein, it
is understood that delays in construction of the
Facilities arising from "force majeure" shall not be
included in the time allowed for completion of the
project as set out in Subparagraph (f) above. For
purposes of this Subparagraph, "force majeure" shall
mean acts of God, strikes, lockouts, or other
industrial disturbances, acts of the public enemy,
wars, blockades, insurrections, riots, epidemics,
landslides, lightning, earthquakes, fires, storms,
floods, washouts, arrests and restraints of
government and people, civil disturbance, and
explosions.
2. Insofar as the construction of the Facilities set forth
herein, TEXAS TECH, shall be responsible for providing at
its sole expense, the following:
A-7
a. The land for the site which shall be subject to the
surface Lease Agreement provided in Exhibit "B"
(Lease Agreement) attached hereto and made a part
hereof.
b. All necessary easements and rights-of-way across, in
or under property owned by TEXAS TECH for the purpose
of the CITY through LP&L providing fuel lines, waste
disposal lines, water lines, power transmission
lines, meters and other equipment necessary to
distribute fuel and water to the Facilities and to
distribute electric power from the Facilities in
order to implement this Agreement. All easements
granted or to be granted by TEXAS TECH in conjunction
with this Agreement are a part of the consideration
for this Agreement and shall be in a form acceptable
to TEXAS TECH.
C. The cost of steam and condensate piping installation
from five feet outside the leased property lines to
the Central Heating and Cooling Plant I.
d. The cost of connecting the steam and condensation
lines between the Facilities and the Central Heating
and Cooling Plant I.
II.
CONDITIONS OF PERFORMANCE
The performance of this Construction Agreement by
either party, except as otherwise specifically provided herein,
shall be subject to the occurrence of all of the following events
or conditions:
=-J
A. Approval of this Agreement by the TEXAS TECH and TEXAS
TECH UNIVERSITY HEALTH SCIENCES CENTER Board of Regents
and any other entity or party having authority to approve
or disapprove this Agreement on behalf of TEXAS TECH;
B. The approval of this Agreement by the CITY OF LUBBOCK
Utilities Board and the CITY OF LUBBOCK City Council;
C. The obtaining by the CITY through LP&L within twelve (12)
months after the signing of this Agreement, unless TEXAS
TECH extends such period, which extension shall not be
unreasonably withheld when the delay is beyond the
control of the CITY, of all permits, approvals, and
licenses from all state and federal governmental agencies
or commissions having jurisdiction over the construction
or operation of the Facilities.
D. The approval and sale of bonds by the CITY OF LUBBOCK for
the benefit of LP&L necessary to finance the obligations
of the CITY pursuant to this Agreement within twelve (12)
months after the signing of this Agreement unless Texas
Tech extends such period, which extension shall not be
unreasonably withheld when the delay is beyond the
control of the CITY.
E. The approval by TEXAS TECH of the plans as to appearance
and architectural design necessary to maintain the
quality of appearance and compatibility with TEXAS TECH
Central Heating and Cooling Plant I;
III.
ASSIGNMENT
This Agreement may not be assigned by the CITY and/or
A-9
LP&L without the prior written consent of TEXAS TECH, which
consent will not be unreasonably withheld. Refusal by TEXAS TECH
Lo consent to any such assignment based upon its sole evaluation
of any proposed assignee's financial stability and condition,
operating ability and record, service reliability, overall
stability and historical performance shall not be considered
unreasonable for purposes of this Agreement, provided, however,
nothing herein is intended to limit TEXAS TECH's rights to
withhold any consent to assignment for reasons other than stated
in this paragraph. The right of TEXAS TECH to refuse to consent
to any proposed assignment by the CITY and/or LP&L is a part of
the consideration of this Agreement.
IV.
NO PARTNERSHIP, JOINT VENTURE OR LENDING OF CREDIT INTENDED
It is specifically agreed that the parties do not
intend by this Agreement to create any species of partnership,
joint venture or other legal entity between them. The rights and
obligations of the parties are to be governed strictly by this
Agreement, and it is not intended that there shall be any lending
of credit by one party to the other or that either party shall be
entitled to create any obligation binding on the other party not
specifically provided for herein.
Nothing herein shall be construed as a loan or pledge
of credit or assets by the State of Texas or TEXAS TECH as
prohibited by Article 3, Section 50 of the Texas Constitution or
otherwise.
A-10
Nothing herein shall be construed as a loan or pledge
of credit or assets by the State of Texas or CITY through LP&L as
prohibited by Article 3, Section 52 of the Texas Constitution or
otherwise.
V.
TEXAS TECH shall not be liable or responsible for and
shall be saved and held harmless by the CITY and LP&L from and
against any and all claims and damages of every kind, including
but not limited to any violations of any local, state and/or
federal law, regulation or rule, for injury or death to any
person or persons and from damage to or loss of property arising
out of or attributed directly or indirectly to the construction,
operations, transmission of electricity, or performance of the
CITY and/or LP&L under this Agreement.
CITY OF LUBBOCK and LP&L shall not be liable or
responsible for and insofar as the Constitution and laws of the
State of Texas allow shall be saved and held harmless by TEXAS
TECH from and against any and all claims and damages of every
kind, including but not limited to any violations of any local,
state and/or federal law, regulation or rule, for injury or death
to any person or persons and from damage to or loss of property
arising out of or attributed directly or indirectly to the
operation and/or maintenance of the Central Heating and Cooling
Plant I of TEXAS TECH.
A-11
VT.
ENTIRE AGREEMENT
The provisions contained in this writing including all
exhibits shall constitute the entire agreement between the
parties hereto irrespective of any discussions, negotiations,
exchange of data and information from and between TEXAS TECH and
its agents, employees, or consultants, and the CITY and LP&L.
The CITY and LP&L expressly represent that they have made their
separate independent evaluation concerning all the matters
covered by this Agreement and the Exhibits attached hereto, and
that the CITY and LP&L's proposal and this Agreement resulting
therefrom is based upon such independent evaluations and not upon
reliance upon any discussions, data, or information provided by
TEXAS TECH, its agents, employees, or consultants.
VII.
APPLICABLE LAW
The laws of the State of Texas shall govern the
validity, performance and enforcement of this Agreement and the
venue for any legal proceedings shall be in Lubbock County,
Texas.
A-12
VIII.
BINDING EFFECT
This Agreement shall be binding on the parties hereto,
their successors and assigns.
MADE AND ENTERED into this 25th day of February ,
1983 by:
ATTEST:
WUT;v^.Y, 50AZD Of RIG"
THE CITY OF LUBBOCK
By: '00c
Mayor
LUBBOCK POWER AND LIGHT
By:
Director
(Approved as to content)
By:
orney
(Approved as to form)
TEXAS TECH UNIVERSITY
TEXAS TECH UNIVERSITY
HEALTH SCIENCES CENTER
A-13
r
EXHIBIT "A-1"
(General Site Location)
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SKHIBIT A-1
EXHIBIT "B"
LEASE AGREEMENT
This LEASE AGREEMENT made and entered into by Texas
Tech University and Texas Tech University Health Sciences Center,
institutions of higher education of the State of Texas, acting by
and through their Board of Regents ("LESSOR"), the CITY OF
LUBBOCK, a home rule municipal corporation ("CITY") and LUBBOCK
POWER & LIGHT (LP&L), a division of the CITY OF LUBBOCK
("LESSEE"), each acting through its duly authorized officials as
follows:
WHEREAS, the CITY and LP&L and TEXAS TECH have entered
into a ENERGY AGREEMENT of the same date hereof, and
WHEREAS, as a part of such ENERGY AGREEMENT, the CITY,
LP&L, and TEXAS TECH have agreed to certain terms and conditions,
one of which is to enter into a LEASE AGREEMENT in order to
effectuate the terms, conditions and intent of such ENERGY
AGREEMENT,
NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS,
That for and in consideration of the mutual benefits to
the parties hereto, it is mutually agreed as follows:
I.
LEASED PREMISES
LESSOR hereby leases to LESSEE the surface only of the
site specifically identified on Exhibit B-1 attached hereto and
made a part hereof, hereinafter referred to as the "LEASED
PREMISES".
B-1
II.
TERM OF LEASE
A. Lease Period:
The term of this LEASE AGREEMENT shall be for a period
of thirty-five (35) years, unless earlier terminated or
extended in accordance with the provisions of this LEASE
AGREEMENT and/or the provisions of said ENERGY AGREEMENT.
B. Lease Commencement:
The term of this LEASE AGREEMENT shall begin the
earlier of the date when the Conditions of Performance set
forth in Section IV of this LEASE AGREEMENT have been met or
May 1, 1995; provided, however, that TEXAS TECH shall have
the right at any time during the first 36 months after date
of execution hereof to designate an earlier date than May 1,
1995, to replace that date, but in no event earlier than May
1, 1991. If the term of this lease begins before the
Conditions of Performance are met, and the Conditions of
Performance have not been met within 60 days after the term
of this LEASE AGREEMENT begins, then this LEASE AGREEMENT
shall terminate automatically. Termination shall not prevent
either party from pursuing whatever remedies it has against
the other party, other than the right to specific performance
of this lease, under the provisions of this lease, the
Construction Agreement, or the Utility Agreement, or by law,
including, but not limited to, remedies for unreasonable
delay or interference preventing the fulfillment of the
Conditions of Performance.
The term of this Lease Agreement shall, at LESSOR's
option, be extended for an additional period of time
necessary for LESSOR to obtain the benefits and full term of
the Utilities Agreement on a year -to year basis upon sixty
(60) days' written notice prior to expiration of any year
following the expiration of the original term.
III.
USE OF PREMISES
A. Purpose for Use:
The .LEASED PREMISES covered by this LEASE AGREEMENT
shall be used only for the purpose of constructing,
maintaining and operating the Facilities included in the
project described in the ENERGY AGREEMENT and subject to the
terms and conditions of this LEASE AGREEMENT, the
CONSTRUCTION AGREEMENT and the UTILITIES AGREEMENT.
B. Construction on Premises:
LESSEE will construct or cause to be constructed the
Facilities described in said CONSTRUCTION AGREEMENT. Such
Facilities shall be constructed in accordance with the plans
for appearance and architectural design as set forth as a
part of said CONSTRUCTION AGREEMENT.
C. Maintenance of Premises:
LESSEE at all 'times, shall be obligated and solely
responsible for all repairs and maintenance necessary to
maintain the LEASED PREMISES, and all Facilities and
improvements thereon in good condition, in a condition in
B-3
accordance with said CONSTRUCTION AGREEMENT, in a condition
that is and will remain in compliance with all local, state,
federal and other applicable laws and regulations.
D. Consideration:
1. The consideration for this LEASE AGREEMENT so long as
electrical service or steam is provided by LP&L to TEXAS
TECH is the agreements of the CITY and LP&L, which are
beneficial to LESSOR and the CITY and LP&L, contained in
this Agreement, together with the expenditure of funds in
constructing, maintaining and operating the Facilities,
pursuant to this ENERGY AGREEMENT.
2. In the event TEXAS TECH purchases no electrical service
or steam from LP&L, LP&L shall pay to TEXAS TECH $2000.00
per month as rental fees for the leased premises. Such
rental fee shall be due the first day of the month
following the suspension of services. Upon failure of
LP&L to pay such rental fee, TEXAS TECH's remedies shall
include but not be limited to the right to terminate the
lease after notice of default to LP&L and sixty (60) days
'to cure. However, nothing herein shall prohibit LP&L
from selling its electrical product produced on the TEXAS
TECH campus to such other customers as it may have
available to it at such time.
E. Surrender at Termination:
Except as provided in VI below, upon the termination of the
LEASE AGREEMENT, the Lessee shall remove within 24 months all
improvements constructed on the premises by it with the
exception of the substation which may remain on the premises
B-4
as long as LP&L is still providing electric service to TEXAS
TECH. The Lessee shall be required to restore the premises
to the extent reasonably possible, to the condition in which
they existed at the commencement of the Lease or at the
option of LESSOR, be required to leave any fence structure
and other landscaping and site beautification in place. Any
holdover will be a tenancy at sufferance.
IV.
CONDITIONS OF PERFORMANCE
The performance of this Lease Agreement by either
party, except as otherwise specifically provided herein, shall be
subject to the occurrence of all of the following events or
conditions:
A. Approval of this Agreement by the TEXAS TECH and TEXAS
TECH UNIVERSITY HEALTH SCIENCES CENTER Board of Regents
and any other entity or party having authority to approve
or disapprove this Agreement on behalf of TEXAS TECH;
B. The approval of this Agreement by the CITY OF LUBBOCK
Utilities Board and the CITY OF LUBBOCK City Council;
C. The obtaining by the CITY through LP&L within twelve (12)
months after the signing of this Agreement, unless TEXAS
TECH extends such period, of all permits, approvals, and
licenses from all state and federal governmental agencies
or commissions having jurisdiction over the construction
or operation of the Facilities.
D. The approval and sale of bonds by the CITY OF LUBBOCK for
the benefit of LP&L necessary to finance the obligations
B-5
of the CITY pursuant to this Agreement; within twelve
(12) months after -the signing of this Agreement unless
TEXAS TECH extends such period.
E. The approval by TEXAS TECH of the plans as to appearance
and architectural design necessary to maintain the
quality of appearance and compatibility with TEXAS TECH
Central Heating and Cooling Plant I;
V.
ASSIGNMENT AND SUBLETTING
The CITY and LP&L shall not assign or sublet this Lease
or otherwise transfer ownership of the Facilities without the
prior written consent of TEXAS TECH, which consent will not be
unreasonably withheld. Refusal by TEXAS TECH to consent to any
such assignment based upon its sole evaluation of any proposed
assignee's financial stability and condition, operating ability
and record, service reliability, overall stability and historical
performance shall not be considered unreasonable for purposes of
this Agreement, provided, however, nothing herein is intended to
limit TEXAS TECH's rights to withhold any consent to assignment
for reasonable reasons other than stated in this paragraph. The
right of TEXAS TECH to refuse to consent to any proposed
assignment by the CITY and/or LP&L is a part of the consideration
of this Agreement. In keeping with Section IV, Integration of
Agreements, of the ENERGY AGREEMENT to which this Agreement is
attached, any proposed assignee of this Lease must be able to
perform all obligations of the CITY and LP&L under the
CONSTRUCTION AGREEMENT and UTILITIES AGREEMENT of even date
B-6
herewith, and consent to assignment of this Lease shall be
contingent upon assignment of each of the other contracts to the
same assignee.
VI.
OWNERSHIP UPON TERMINATION, ABANDONMENT OR SALE
Upon termination of this Agreement, TEXAS TECH shall
have the option to purchase the Facilities subject to this
Agreement at the fair market value of such Facilities as set by
appraisal. If TEXAS TECH declines the option to purchase, the
CITY through LP&L shall remove all improvements constructed on
the premises as set out in the Lease Agreement, Paragraph III,
Use of Premises. If TEXAS TECH purchases the Facilities, the
LEASE AGREEMENT will terminate.
In the event the CITY through LP&L abandons the
Facilities during the term of this Agreement, as evidenced by
LP&L's failure to man or operate the Facilities subject to this
Agreement or by LP&L's notification to TEXAS TECH of such
abandonment TEXAS TECH shall have the option to obtain the
Facilities subject to this Agreement at the fair market value as
set by appraisal. If TEXAS TECH declines the option to obtain
the Facilities, the CITY through LP&L shall remove all
improvements constructed on the premises as set out in the Lease
Agreement, Paragraph III, Use of Premises. If TEXAS TECH obtains
the Facilities, the LEASE AGREEMENT will terminate.
In the event LP&L elects to sell the Facilities subject
to this Agreement during the term of this Agreement, TEXAS TECH
shall have first option to purchase the Facilities subject to
B-7
this Agreement at the fair market value of such Facilities as set
by appraisal. If TEXAS TECH purchases the Facilities, the LEASE
AGREEMENT will terminate.
VII.
NO PARTNERSHIP, JOINT VENTURE OR LENDING OF CREDIT INTENDED
It is specifically agreed that the parties do not
intend by this Agreement to create any species of partnership,
joint venture or other legal entity between them. The rights and
obligations of the parties are to be governed strictly by this
Agreement, and it is not intended that there shall be any lending
of credit by one party to the other or that either party shall be
entitled to create any obligation binding on the other party not
specifically provided for herein.
Nothing herein shall be construed as a loan or pledge
of credit or assets by the State of Texas or TEXAS TECH as
prohibited by Article 3, Section 50 of the Texas Constitution or
otherwise.
Nothing herein shall be construed as a loan or pledge
of credit or assets by the State of Texas or CITY through LP&L as
prohibited by Article 3, Section 52 of the Texas Constitution or
otherwise.
VII.
LESSOR shall not be liable to LESSEE or LESSEE's
employees, patrons, or visitors, or to any other person, for any
damage to person or property, caused by LESSEE or of any other
tenant of said demised premises, or due to any buildings on said
premises or any appurtenances thereto being improperly
constructed, or being or becoming out of repair, nor for any
damages from any defects or want of repair from any part of any
buildings of which the leased premises form a part. LESSEE
accepts such premises as suitable for the purposes for which the
same are leased and accepts such premises on an as is condition,
and waives any defects therein, and agrees to hold LESSOR
harmless from any and all claims of any nature whatsoever,
including but not limited to claims for damages arising out of
any injury to or death of any person or persons and for damage to
or loss of property arising out of or attributed directly or
indirectly to the operations, construction, or maintenance
activities of the LESSEE hereunder whether on or off the leased
premises.
Lessee shall not be liable to Lessor or Lessor's
employees, patrons, or visitors, or to any other person for any
damage to person or property caused by Lessor.
IX.
ENTIRE AGREEMENT
The provisions contained in this writing including all
exhibits shall constitute the entire agreement between the
parties hereto irrespective of any discussions, negotiations,
exchange of data and information from and between LESSOR and its
agents, employees, or consultants, and the CITY and LP&L. The
CITY and LP&L expressly represent that they have made their
separate independent evaluation concerning all the matters
covered by this Agreement and the Exhibits attached hereto, and
I]
that the CITY and LP&L's proposal and this Agreement resulting
therefrom is based upon such independent evaluations and not upon
reliance upon any discussions, data, or information provided by
LESSOR, its agents, employees, or consultants.
X.
APPLICABLE LAW
The laws of the State of Texas shall govern the
validity, performance and enforcement of this Agreement and the
venue for legal proceedings shall be in Lubbock County, Texas.
XI.
BINDING EFFECT
This Agreement shall be binding on the parties hereto,
their successors and assigns.
B-10
XII.
A memorandum of agreement and acknowledgement shall be
filed of record.
MADE AND ENTERED into this 25th day of February ,
1988 by:
ATTEST:
C# :rte
THE CITY OF LUBBOCK
By:
Mayor
LUBBOCK POWER AND LIGHT
I�
BY
Director
(As to content)
By:
orney
(As to form)
TEXAS TECH UNIVERSITY
TEXAS TECH UNIVERSITY HEALTH
SCIENCES CENTER
By
OF
B-11
EXHIBIT "B-1
(General Site Location)
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'EXHIBIT B-1
EXHIBIT "C"
UTILITIES AND STEAM PURCHASE AGREEMENT
This UTILITIES AND STEAM PURCHASE AGREEMENT made and
entered into by and between TEXAS TECH UNIVERSITY and TEXAS TECH
UNIVERSITY HEALTH SCIENCES CENTER, institutions of higher
education of the State of Texas, acting by and through their
Board of Regents, ("TEXAS TECH"), the CITY OF LUBBOCK, a home
rule municipal corporation ("CITY") and LUBBOCK POWER & LIGHT
("LP&L") each acting by and through its duly authorized officials
as follows:
WHEREAS, the CITY, LP&L, and TEXAS TECH have entered
into a ENERGY AGREEMENT including a POWER PLANT CONSTRUCTION
AGREEMENT ("CONSTRUCTION AGREEMENT") and a LEASE AGREEMENT
("LEASE AGREEMENT"), covering the site of certain Facilities
contemplated by such CONSTRUCTION AGREEMENT and
WHEREAS, as a part of such ENERGY AGREEMENT, the
parties have agreed to certain terms and conditions, one of which
is to enter into a UTILITIES AND STEAM PURCHASE AGREEMENT
("UTILITY AGREEMENT") in order to effectuate the terms,
conditions, and intent of such ENERGY AGREEMENT.
NOW THEREFORE, KNOW ALL MEN BY THESE PRESENTS,
That for and in consideration of the mutual benefits to
the parties hereto, it is mutually agreed as follows:
C-1
I.
CONVERSION OF EXISTING DISTRIBUTION SYSTEM
As a part of the services and work to be performed by
the CITY and LP&L pursuant to this Agreement, it is agreed that
the existing 4,160 volt distribution system owned by TEXAS TECH,
which is presently being upgraded by LP&L, shall continue to be
systematically converted at LP&L's cost to a 12,470 volt or
higher system and ownership shall be vested in the CITY, through
LP&L, as and to the extent that the conversion is completed.
II.
COMBINATION OF EXISTING METERS
The CITY, through LP&L, has agreed and does hereby
agree to perform all labor and provide all material and equipment
necessary to combine existing meters into an agreed maximum
number of seven (7) as of the date of this Agreement on the TEXAS
TECH Campus as follows:
A. Procedure and Billing:
All existing meters located on the TEXAS TECH Campus
and the TEXAS TECH UNIVERSITY HEALTH SCIENCES CENTER
campus will be utilized. Subject to ordinances of the
CITY OF LUBBOCK prohibiting combining of meters which are
separated by a dedicated street or alley, energy and
demand readings of the existing and future meters will be
totaled. The demand sum will be multiplied by a factor
of 0.888 which will represent an equivalent demand
diversity of the combined meters. The energy sum will be
multiplied by a factor of 1.03 which will represent the
C-2
increased losses inherent in the distribution lines and
transformers beyond a primary meter if the primary meter
was physically installed. The energy and demand numbers
adjusted as indicated above will be used in the rate
described in Section III C.1 to calculate the electricity
bills to be paid by TEXAS TECH.
B. Effective Date:
The effective date for said combination of meters on
the TEXAS TECH Campus presently served by LP&L shall be
the next billing date after signing by the parties hereto
of this Agreement. The effect of such combination shall
be reflected in the next billing by LP&L to TEXAS TECH.
The meters on the TEXAS TECH campus presently served by
Southwestern Public Service Company (SPS), except those
meters serving the TEXAS TECH UNIVERSITY HEALTH SCIENCES
CENTER, will be combined as soon as possible, not to
exceed eighteen (18) months from the signing of this
Agreement, and the effect of such combination shall be
reflected in the next billing to TEXAS TECH as meters are
taken over by LP&L. Since it is recognized by LP&L that
the combination of all meters is an important part of the
savings to TEXAS TECH, it is agreed that the meters at
the TEXAS TECH UNIVERSITY HEALTH SCIENCES CENTER
presently served by SPS will be combined as soon as
possible with LP&L's best efforts but in no event shall
the date for combining these meters be later than the
date of first delivery of steam from LP&L to TEXAS TECH
C-3
from the Facilities. In the event the meters at the
Texas Tech University Health Sciences Center are not
combined by the date of first delivery of steam, LP&L
shall pay to Texas Tech the difference between the rates
with multiple SPS meters at SPS rates and consolidated
LP&L meters at LP&L rates until such time as the meters
are combined.
C. Access to Premises
It is agreed that the CITY through LP&L may enter the
leased premises before the term of the Lease Agreement
commences as set out in the Lease Agreement, Paragraph
II, for the purpose of constructing a substation which
shall be used to facilitate the conversion of existing
meters as set out in this Agreement, Paragraph II, and to
provide electric service to TEXAS TECH. In the event the
Lease Agreement is not commenced, LP&L shall be required
to restore the premises to the extent reasonably
possible, to the condition in which they existed at the
time LP&L entered the premises.
D. Option as Separate Agreement:
TEXAS TECH, at its option, may elect to proceed with
and enforce the provisions of this Section II portion of
the Agreement, as a separate Agreement, irrespective of
the other provisions herein. In the event the Facilities
are never completed as contemplated by this Energy
Agreement, TEXAS TECH may at its option elect to proceed
with Paragraph II of this Utilities Agreement and the
CITY through LP&L shall perform.
C-4
ELECTRIC SERVICE AND STEAM
A. Purchase:
Subject to any notice provisions and the terms of any
existing agreements with Southwestern Public Service
Company, TEXAS TECH, during the term of this Agreement,
shall, following the last effective date of the
combination of existing meters provisions of this
Agreement, purchase all its electric power requirements
within the LP&L service area from LP&L for its facilities
located in Lubbock, Texas, including all power require-
ments of the TEXAS TECH UNIVERSITY HEALTH SCIENCES
CENTER. It is agreed that TEXAS TECH will continue to
contract with Southwestern Public Service for electric
service to the TEXAS TECH UNIVERSITY HEALTH SCIENCES
CENTER until such time as the CITY through LP&L can
provide said service and TEXAS TECH can meet all notice
requirements of said contract. In addition, TEXAS TECH,
during the term of this Agreement, shall have the right
to purchase steam, up to a maximum of 40,000 lbs. per
hour from LP&L, subject to the terms of this Agreement.
B. Term:
1. The original term of the electric service provisions
of this Agreement shall be twenty (20) years unless
earlier suspended in accordance with this Agreement.
Such term shall begin upon the date of the first
delivery of steam pursuant to this contract.
C-5
2. The original term of the steam purchase provisions of
this Agreement shall be for twenty (20) years, and
such term shall begin on the date of first delivery
of steam from LP&L to TEXAS TECH from such
Facilities.
3. Following the expiration of the original term for
electrical service provisions and steam, TEXAS TECH
shall have the right to review and the option to
either continue or suspend electric service and steam
for three additional five (5) year terms. At the end
of the primary term, TEXAS TECH shall exercise the
right to review and may elect to continue or to
suspend this Agreement for five (5) additional years.
At the end of this five ( 5 ) years, TEXAS TECH shall
exercise the right to review and may elect to
continue or to suspend this Agreement for another
five (5) years. At the end of the second option
period, TEXAS TECH may exercise its right to review
and may elect to continue or suspend this Agreement
for another five (5) years. The right to continue
this Agreement for a total of fifteen (15) years
beyond the primary term shall not be affected by any
Suspension or Reinstatement of Service as set out in
Paragraph IV of this Agreement.
4. TEXAS TECH further reserves the right to elect to
terminate or continue electric service and/or said
steam purchase provisions of this Agreement as
C-6
separate agreements during the initial 20 -year term
and during each of the three additional five (5) year
terms. If TEXAS TECH elects to terminate the
electric service provisions of this Agreement, LP&L
shall continue to provide up to 40,000 pounds of
steam per hour, pursuant to this Agreement.
C. Price and Price Adjustment:
The prices to be paid by TEXAS TECH to LP&L for
electricity and steam supplied pursuant to this
Agreement, and adjustments to such prices, shall be the
following:
1. Electricity:
The price paid by TEXAS TECH for electricity,
pursuant to this Agreement, shall be just and
reasonable and shall be the lowest rate available in
LP&L's service area to comparable customers now and
during the term hereof, based on kilowatt-hours of
usage, demand and applicable loading factors. LP&L
shall provide TEXAS TECH, upon request, all data
utilized by it in the calculation of the rate to
TEXAS TECH. For illustrative purposes only see
Exhibit "C-1" for a list of comparable customers and
current rate schedule as of April 1, 1988. It is
understood that such rates and list of comparable
customers may change from time to time consistent
with the terms of this Agreement.
2. Steam:
a. The price of steam delivered to TEXAS TECH, when
C-7
electric power is also purchased pursuant to this
Agreement, shall be the rates reflected on
Exhibit "C-2", Steam Rates. Adjustments to the
price of steam sold to TEXAS TECH shall occur
only when the natural gas fuel price to LP&L
increases above the projected natural gas fuel
costs set forth in Exhibit "C-211. Steam price
increases due to gas turbine degradation, less
than expected plant efficiency, or any other
factor shall be charged to the account of LP&L.
Adjustments in the price of steam to TEXAS TECH
due to fuel price increases above those projected
in the attached Exhibit "C-2" shall be calculated
by multiplying .110724 times the difference in
the excess of the actual monthly weighted average
fuel costs to LP&L over the fuel prices projected
in Exhibit "C-211. This adjustment shall be added
to the steam price as stated in Exhibit "C-2" to
determine the total unit price of steam to TEXAS
TECH. The price adjustment shall be reflected in
the next monthly billings of LP&L to TEXAS TECH
for steam usage.
b. The price of steam delivered to TEXAS TECH, when
electric power is not also purchased pursuant to
this agreement shall be LP&L's true costs of
producing this steam. TEXAS TECH shall pay the
following actual costs without regard to the
W-1
amount of steam taken: all maintenance costs and
all labor costs. In addition, TEXAS TECH shall
pay LP&L's costs for the gas and water used in
producing the steam taken.TEXAS TECH shall
receive a. credit for any electrical energy
produced and taken by LP&L. This credit would
equal the value of any energy which could be
replaced (without creating additional expense to
LP&L) with energy provided by this project.
Under normal operating conditions, this will
equal the value of an equivalent amount of
non-firm energy. For the purposes of this
Agreement, non-firm energy is defined as:
electric energy which the wholesale supplier can
produce and can deliver when the CITY through
LP&L chooses to purchase said power. The price
of non-firm energy will be made available by the
CITY through LP&L to TEXAS TECH upon request.
The steam prices under this case shall never
be less than the base steam prices presented in
Exhibit "C-2".
3. Prices Upon Expiration of Agreement
Upon expiration of this Agreement or any
extensions of this Agreement, TEXAS TECH shall
have the preferential right to purchase steam
and/or electrical power under the same terms and
conditions existing under this Agreement on a
C-9
year-to-year basis subject to cancellation upon
one (1) year's written notice by either party.
D. Steam Quality and Volume:
The steam to be available to TEXAS TECH, pursuant to
this Agreement, shall be provided at a temperature of
750°F and 600 psi pressure, plus or minus five percent
(5%) for temperature and pressure, at the point of
metering in the steam line to Central Heating and Cooling
Plant I and at a quality comparable to that used in
LP&L's gas turbine on the site of the Facilities. All
chemicals used in the treatment of water to generate
steam shall be FDA approved. The volume of steam
available to TEXAS TECH shall be 40,000 pounds per hour.
TEXAS TECH expects to receive 40,000 pounds per hour of
steam on a continuous basis; however, TEXAS TECH reserves
the right to require LP&L to deliver steam from 0 to
40,000 pounds per hour depending on TEXAS TECH's minimum
steam requirements provided, however, that TEXAS TECH
shall, except in an emergency, give notice to LP&L of any
change of ten percent (10%), or more, in an anticipated
steam usage, at least 24 hours prior to the required
steam delivery time.
E. Water Replacement:
It shall be the responsibility of TEXAS TECH to
supply return water of the same quality and quantity as
that supplied to TEXAS TECH in steam. The CITY through
LP&L agrees to treat a lesser quality of returned
C-10
condensate from TEXAS TECH, so that it shall be of the
same quality as steam supplied, provided that all costs
attributable to such treatment shall be borne by TEXAS
TECH. Any required treatment of returned condensate
water will be done by LP&L only to the extent necessary
to match •the quality of that supplied in steam under this
Agreement. A guaranteed analysis of water shall be
supplied to the CITY through LP&L by TEXAS TECH as
required, but not less than annually. The CITY through
LP&L will provide an estimate of the expected cost of
treatment per thousand gallons. The actual cost will be
calculated when steam is sold to TEXAS TECH and actual
cost determined. The cost will be adjusted yearly to
reflect actual maintenance and operation cost. TEXAS
TECH's costs shall be determined based on TEXAS TECH's
proportionate share of water treated to the total water
treated by LP&L at the Facilities and costs may include
the following: capital, chemicals, losses in treatment
process, energy required, maintenance at LP&L's cost,
supplies at LP&L's cost, and labor at LP&L's cost.
Waste products arising from the treatment of
condensate returned by TEXAS TECH will be transferred to
TEXAS TECH for its disposal.
TEXAS TECH agrees to return condensate in a quantity
calculated on the basis of steam delivered in pounds per
hour. A deviation of 5% from steam quantity delivered is
permitted each day. Adjustments will be made daily to
C-11
the rate of flow of returned condensate to bring it
within the 5% tolerance. At the end of each calendar
month, the inadvertent balance will be carried into the
next billing cycle to be adjusted to bring the steam
delivered and condensate returned difference to zero.
Steam supplied to TEXAS TECH shall be of the same
quality as supplied to the gas turbine on the site of the
Facilities for injection. Maximum concentrations of
Sodium plus Potassium (Na+K) shall not exceed 200 parts
per billion (PPB). Total conductivity shall be in the
range of 0.5 to 1.5 Micro-MHO/CM 95% of the time not to
exceed 2.0 Micro-MHO/CM. Total solids shall be less than
50 parts per billion 95% of the time not to exceed 100
parts per billion maximum.
F. Metering:
1. Steam•
The CITY and LP&L shall provide a flange tapped
orifice meter tube constructed and installed
according to ASME Standard for minimum upstream and
downstream distances, and internal diameter and
smoothness. The meter tube shall be proven to yield
plus or minus four percent (40) accuracy of reading
for mass flow in the range 10,000 to 40,000 lb/hr.
Orifice beta ratio shall not exceed 0.75 nor be less
than 0.20. The CITY through LP&L shall provide
upstream and downstream pressure and temperature
C-12
instrumentation, outside the meter tube length, to
establish actual mass flow as well as steam quality.
All transmitters shall be of an electronic type and
provide 4-20mA (1-5Vdc) output to a multi -channel
data logger and totalizer, which provides for logging
instantaneous flow, pressure and temperature and
totalized steam mass flow on 15 minute intervals.
Sufficient outputs shall be available to provide data
to TEXAS TECH as well as LP&L.
2. Condensate:
The CITY through LP&L shall provide a turbine type
flow meter for metering the condensate returned from
TEXAS TECH to the Facility. Linearity shall be
better than ± 1.0% of reading over rated flow range.
Repeatability shall be better than ± 0.50 of reading
in rated linear flow range. An in-line basket -type
(20 -mesh liner) strainer shall be provided upstream
of the turbine flow meter. The strainer shall be
provided with differential pressure instrumentation
to indicate fouling. The meter shall deliver
electronic pulses whose frequency is linear with the
flow rate. These pulses shall output to a
multichannel data logger and totalizer, which logs
instantaneous flow and totalized condensate flow on
15 minute intervals. Quantities of returned
condensate shall be accounted for as defined in
Paragraph II.E., Water Replacement.
C-13
G. Steam Availability:
LP&L agrees to supply steam at the steam quality and
volume herein defined at the availability for each TEXAS
TECH fiscal year as set out in Exhibit "C-3", Steam
Availability. If at the end of each fiscal year it is
calculated that the steam availability for the year was
less than that defined for that year, as set out in
Exhibit "C-3", then TEXAS TECH shall be credited the cost
of generating steam to reach the required availability.
The cost of this steam shall be calculated per the
formula on Exhibit "C-3".
Beginning in the second year and each year
thereafter, the number of days of actual availability
over and above the scheduled availability will be set
aside in a Reserve Days account not to exceed 150 days.
Each year that actual availability is less than
scheduled, due to mechanical or operational problems,
days will be drawn from the Reserve Days Account as long
as days are available.
H. Payment•
Subject to the provisions set out above, TEXAS TECH
shall pay to LP&L all invoices for steam or electrical
power in accordance with LP&L's present or agreed to
billing and payment policy.
I. Availability of Funds to Purchase Steam:
The obligation of the CITY to sell and deliver steam
to TEXAS TECH, pursuant to this Agreement, is subject to
C-14
TEXAS TECH having sufficient funds to pay for the steam
delivered to it in accordance with this Agreement.
IV.
SUSPENSION OF SERVICE
A. Suspension by TEXAS TECH:
The electric service provisions of this Utility
Agreement as provided herein, may be suspended by TEXAS
TECH sixty (60) days after LP&L has received formal
written notice from the President of TEXAS TECH of any of
the following events specifying the matters or events
complained of and upon the failure of LP&L to reasonably
cure the complained -of condition within sixty (60) days
from the date of receipt of such notice:
1. The failure of LP&L to deliver electricity to TEXAS
TECH within the rate represented.
2. The failure of LP&L to deliver steam of the volume,
temperature, quality, pressure and availability
provided in this Agreement.
3. The failure of LP&L to provide reliable electric
service in accordance with the specifications for
such service set forth in this Agreement.
4. The failure of LP&L to offer TEXAS TECH the best
electric rate which has been offered to comparable
customers and approved by the appropriate regulatory
authority for the CITY OF LUBBOCK or available to
TEXAS TECH through any regulatory authority.
C-15
5. TEXAS TECH having received an opportunity for
electric service from a third party at a rate
approved by the appropriate regulatory body to
provide electric power at a price lower than that
being charged by LP&L.
6. The change of ownership and/or control of LP&L
through the sale or transfer of its assets, through
the entering into of any contract, operating
agreement, cooperative arrangement or other
arrangement that results in the change of management
and control of the operation of LP&L and/or its
assets without the prior written consent of TEXAS
TECH, which consent will not be unreasonably withheld.
Refusal by TEXAS TECH to consent to any such change
of ownership and/or control based upon its sole
evaluation of the impact upon TEXAS TECH taking into
consideration the new controlling parties contractual
and/or other arrangements, stability and condition,
operating ability and record, service reliability,
overall stability and historical performance shall
not be considered unreasonable for purposes of this
Agreement.
7. A material breach of any obligation of LP&L under
this contract.
B. Suspension by LP&L:
The provisions of this Utility Agreement as provided
herein, may be suspended by LP&L sixty (60) days after
C-16
TEXAS TECH has received formal written notice of a
material breach of any obligation of TEXAS TECH under
this contract specifying the matters or events complained
of and upon the failure of TEXAS TECH to reasonably cure
the complained -of condition within sixty (60) days from
the date of receipt of such notice.
C. LP&L Right Upon Notice of Suspension:
If the complaint of TEXAS TECH is based on it having
received an opportunity for service at a rate approved by
an appropriate regulatory body to provide electric power
at a price lower than that being charged by LP&L, then
LP&L shall be afforded an opportunity to elect, within
sixty (60) days of receipt of written notice of such
offer or bid, to meet the price offered, and in such
event, this contract shall continue in effect. Nothing
herein shall limit the rights of TEXAS TECH to give such
notices, from time to time, upon the occurrence of any of
the events set forth in this Agreement, IV, Suspension of
Service.
D. Suspension and Reinstatement of Service:
TEXAS TECH shall, during the terms of this Utility
Agreement, have the right to suspend from time -to -time
the electric service provisions of this Agreement, obtain
electric service from a third party by following the
terms set forth in Paragraph IV, Suspension of Service,
of this Agreement provided however, that TEXAS TECH may
also elect during the term of this Agreement to terminate
C-17
said third party electric service and LP&L shall have the
obligation to reinstate electric service to TEXAS TECH
upon the same terms, conditions and price as set forth in
this Agreement in Paragraph III, Electric Service and
Steam, C.1 upon one hundred twenty (120) days prior
written notice to LP&L by TEXAS TECH. Upon reinstatement
of electric service from LP&L, the price of any steam
delivered to TEXAS TECH shall convert to the steam price
described in Paragraph III, Electric Service and Steam,
C.2a. and Exhibit C-2, Steam Rates. The right to convert
to a third party electric supplier and to terminate said
third party service and reinstate LP&L electric service
shall be a continuing right and option, exercisable from
time -to -time throughout the entire term of this
Agreement. TEXAS TECH may exercise its right to convert
from LP&L to a third party supplier without limit or
restriction except as contained in Paragraph IV,
Suspension of Service as such provisions apply to LP&L.
Periods of suspension shall not operate to extend the
term of this Agreement.
E. Lease of Distribution Lines and Facilities Following
Suspension•
In the event of a suspension of this Agreement and
the election of TEXAS TECH not to continue the purchase
of electric power from LP&L, then the parties shall enter
into a Lease Agreement covering the underground
distribution lines and Facilities of LP&L on the TEXAS
C-18
TECH Campus, to the extent such lines and Facilities
continue to be used to deliver electricity to TEXAS TECH
following the suspension of LP&L service, which Lease
shall continue in effect so long as TEXAS TECH continues
the use of any Facilities owned by LP&L for the
distribution of electric power to its campus. The
consideration for any such Lease of distribution lines
shall be calculated on the basis of a percentage equal to
one and one-half (12) times the interest rate being paid
on the most recent bond issue involving LP&L immediately
preceding the leasing of the distribution lines. The
depreciated installation costs of the distribution lines
to be leased shall be multiplied by the resulting
percentage and such amount shall represent the annual
.rental, with the monthly rental being determined by
dividing the annual rental by twelve (12).
F. Cooperation Upon Suspension:
In the event of a suspension of electric service
hereunder, LP&L shall cooperate with TEXAS TECH and any
third party electric supplier in an effort to insure a
minimum of interruptions in service to TEXAS TECH.
G. Purchase of Lines and Facilities:
Upon agreement, TEXAS TECH may purchase said
underground distribution lines and facilities at fair
market value insofar as such is allowed by the laws and
Constitution of the State of Texas.
H. Suspension of Steam Obligation:
C-19
The suspension of the electric service provisions of
this Agreement shall not suspend the obligation on the
part of LP&L to provide steam as provided herein, unless
the steam service is also specifically suspended, in
writing, by TEXAS TECH.
V.
EASEMENTS
TEXAS TECH shall execute and deliver to the CITY
easements covering all pipelines, steam and electrical
transmission lines, waste disposal lines, water lines, and other
facilities covering locations and in a form agreed to by the
parties hereto and in accordance with this Agreement. All future
easements necessary to fulfill the terms of this Agreement shall
be subject to the prior approval of TEXAS TECH. The CITY through
LP&L shall have the right to enter for temporary construction and
to affect repairs as needed. All easements pertaining to the
Facilities shall revert to Texas Tech in the event Texas Tech
obtains or purchases the Facilities.
VI.
FUEL SUPPLY
A. Fuel Obligation:
It shall be the sole obligation of the CITY and LP&L
to provide the fuel supply for the Facilities. The CITY
and LP&L will provide an adequate, reliable, cost
efficient, prudent and competitive fuel supply for such
Facilities during the term of this Agreement. LP&L will
provide copies of all existing and future fuel supply
C-20
agreements and amendments entered into by LP&L and other
data necessary to determine LP&L's fuel costs. The
receipt of any such agreements, and/or data shall not be
construed as approval or disapproval by TEXAS TECH of
such agreements, amendments or data.
Texas Tech may elect to assist in negotiations to
provide the fuel supply for the Facilities if it is
deemed beneficial to Texas Tech and LP&L. Such
assistance by Texas Tech shall not be construed as
approval or disapproval by Texas Tech of such agreements.
B. Natural Gas Pipeline:
Prior to entering into any agreement for the
construction of any natural gas pipeline to serve the
Facilities, LP&L shall notify TEXAS TECH and TEXAS TECH
shall have the right to participate in the use of said
pipeline if constructed by LP&L by paying for the
incremental cost of construction of any capacity added
for TEXAS TECH use. TEXAS TECH shall continue to be
financially responsible .for its incremental share of
maintenance and operating costs for said pipeline
constructed by LP&L. ownership of said pipeline
irrespective of any payment by TEXAS TECH shall remain in
LP&L. LP&L shall also notify TEXAS TECH prior to the
entering into of any arrangement for transportation of
natural gas through a pipeline constructed in whole or in
part by a third party to serve the Facilities. TEXAS
TECH shall be afforded the opportunity to participate in
C-21
any discussions regarding such arrangement with a third
party and LP&L. If TEXAS TECH elects not to participate
in either of the pipeline arrangements mentioned herein,
LP&L shall use its best efforts to assure that TEXAS TECH
shall nevertheless be entitled to the use of any pipeline
constructed to serve the Facilities to the extent that
excess capacity is available. If the pipeline is owned
by a third party, LP&L shall use its best efforts to
assure that TEXAS TECH shall pay the same rate or fee
being charged LP&L for the use, if available, of the
pipeline. If LP&L owns the pipeline, and TEXAS TECH has
elected not to pay for its original incremental share of
construction costs, TEXAS TECH shall pay a fee based upon
its proportional share of the use of the total capacity
of the pipeline taking into consideration the cost of the
pipeline for the first five years of use by TEXAS TECH
and thereafter only the operating and maintenance costs
are to be considered.
VII.
MODIFICATION OF TEXAS TECH'S EXISTING FACILITIES
It is understood that certain renovations and modifica-
tions of TEXAS TECH's existing steam plant, which is to be used
in connection with the distribution of steam purchased by TEXAS
TECH will be required, and, further, it is understood that
installation of water and steam distribution lines between the
Facilities and the existing TEXAS TECH steam plant will be
required. TEXAS TECH shall be responsible for completing all
C-22
such improvements, including steam distribution lines, at the
expense of TEXAS TECH. TEXAS TECH shall retain the right to make
appropriate energy conservation modifications to its physical
plant and other facilities as TEXAS TECH determines is in its
best interest.
VIII.
SERVICE AND RELIABILITY
A. Responsibility for Human Needs:
The CITY and LP&L recognize that TEXAS TECH has
certain responsibilities on its campus that affect human
needs, that the Facilities and service to be provided by
the CITY and LP&L are critical to such human needs and
that the consistent, reliable and efficient performance
of the services contemplated by this Agreement are of the
essence of this Agreement.
B. Obligation for Increased Electric Service:
The CITY and LP&L also recognize that the electric
service requirements of TEXAS TECH may change from time
to time and that additional electrical power may be
needed to service the TEXAS TECH campus. The CITY and
LP&L agree to make all necessary arrangements to provide
for such present and increased electric requirements to
TEXAS TECH. The CITY and LP&L shall use their best
efforts to provide 1000 of the electric service needs of
TEXAS TECH.
C. Dedication of Power:
The CITY and LP&L during the term and any extensions
C-23
hereof, shall, at all times, first dedicate electric
power generated by the Facilities to TEXAS TECH to insure
first priority electric service to TEXAS TECH to the
extent that Texas Tech is served by the Facilities.
IX.
ASSIGNMENT
This Agreement may not be assigned by the CITY and/or
LP&L without the prior written consent of TEXAS TECH, which
consent will not be unreasonably withheld. Refusal by TEXAS TECH
to consent to any such assignment based upon its sole evaluation
of any proposed assignee's financial stability and condition,
insurance coverage, operating ability and record, service
reliability, overall stability and historical performance shall
not be considered unreasonable for purposes of this Agreement,
provided, however, that nothing herein is intended to limit TEXAS
TECH's rights to withhold any consent to assignment for reasons
other than stated in this paragraph. The right of TEXAS TECH to
refuse to consent to any proposed assignment by the CITY and/or
LP&L is a part of the consideration of this Agreement.
M.
OWNERSHIP UPON TERMINATION, ABANDONMENT OR SALE
Upon termination of this Agreement, TEXAS TECH shall
have the option to purchase the Facilities covered by this
Agreement at the fair market value of such Facilities as set by
appraisal. If TEXAS TECH declines the option to purchase, the
CITY through LP&L shall remove all improvements constructed on
C-24
the premises as set out in the Lease Agreement, Paragraph III,
Use of Premises.
In the event the CITY through LP&L abandons the
Facilities during the term of this Agreement, as evidenced by
LP&L's failure to man or operate the Facilities subject to this
Agreement or by LP&L's notification to TEXAS TECH of such
abandonment TEXAS TECH shall have the option to obtain the
Facilities subject to this Agreement at the fair market value as
set by appraisal. If TEXAS TECH declines the option to obtain
the Facilities, the CITY through LP&L shall remove all
improvements constructed on the premises as set out in the Lease
Agreement, Paragraph III, Use of Premises.
In the event LP&L elects to sell the Facilities subject
to this Agreement during the term of this Agreement, TEXAS TECH
shall have first option to purchase the Facilities subject to
this Agreement at the fair market value of such Facilities as set
by appraisal.
XI.
NO PARTNERSHIP, JOINT VENTURE OR LENDING OF CREDIT INTENDED
It is specifically agreed that the parties do not
intend by this Agreement to create any species of partnership,
joint venture or other legal entity between them. The rights and
obligations of the parties are to be governed strictly by this
Agreement, and it is not intended that there shall be any lending
of credit by one party to the other or that either party shall be
entitled to create any obligation binding on the other party not
specifically provided for herein.
C-25
Nothing herein shall be construed as a loan or pledge
of credit or assets by the State of Texas or TEXAS TECH as
prohibited by Article 3, Section 50, of the Texas Constitution or
otherwise.
Nothing herein shall be construed as a loan or pledge
of credit or assets by the State of Texas or CITY through LP&L as
prohibited by Article 3, Section 52 of the Texas Constitution or
otherwise.
XII.
PROHIBITIONS ON CERTAIN CONTRACTS
TEXAS TECH shall not enter into any contract or other
understanding or arrangement, such as a "Take -or -Pay" contract or
output contract, with any person other than a state or local
governmental unit pursuant to which the power or steam generated
from the Facilities will be sold to or used by any person in its
trade or business unless such use is solely as a member of, and
on the same terms as, the general public.
XIII.
TEXAS TECH shall not be liable or responsible for and
shall be saved and held harmless by the CITY and LP&L from and
against any and all claims and damages of every kind, including,
but not limited to, claims for any violation of any local, state
and/or federal law, regulation or rule, or for injury or death to
any person or persons or from damage to or loss of property
arising out of or attributed directly or indirectly to the
C-26
construction, operations or performance of the CITY and/or LP&L
under this Agreement.
CITY OF LUBBOCK and LP&L shall not be liable or
responsible for and insofar as the Constitution and laws of the
State of Texas allow shall be saved and held harmless by TEXAS
TECH from and against any and all claims and damages of every
kind, including but not limited to any violations of any local,
state and/or federal law, regulation or rule, for injury or death
to any person or persons and from damage to or loss of property
arising out of or attributed directly or indirectly to the
operation and/or maintenance of the Central Heating and Cooling
Plant I of TEXAS TECH.
XIV.
FORCE MAJEURE
Notwithstanding anything to the contrary herein, it is
understood that any failure of LP&L to perform any obligation set
out in Paragraph III(G) or Paragraph IV(A) shall not be cause for
assessment of additional costs against LP&L or suspension of this
Agreement if such failure is the result of "force majeure". For
purposes of this paragraph, "force majeure" shall mean acts of
God, lightning, fires, storms, riots or other causes beyond the
reasonable control of LP&L.
XV.
ENTIRE AGREEMENT
The provisions contained in this writing shall consti-
tute the entire agreement between the parties hereto irrespective
of any discussions, negotiations, exchange of data and
C-27
information from and between TEXAS TECH and its agents,
employees, or consultants, and the CITY and LP&L. The CITY and
LP&L expressly represent that they have made their separate
independent evaluation concerning all the matters covered by this
Agreement and the Exhibits attached hereto, and that the CITY and
LP&L's proposal and this Agreement resulting therefrom is based
upon such independent evaluations and not upon reliance upon any
discussions, data, or information provided by TEXAS TECH, its
agents, employees, or consultants.
XVI.
APPLICABLE LAW
The laws of the State of Texas shall govern the
validity, performance and enforcement of this Agreement and the
venue for any legal proceedings shall be in Lubbock County,
Texas.
C-28
XVII.
BINDING EFFECT
This Agreement shall be binding on the parties hereto,
their successors and assigns.
MADE AND ENTERED into this 25th
�� i
5[,�te';.JY, iln;M v cf c€SEN[£
C-29
day of
February
THE CITY OF LUBBOCK
By: C c%
Mayor
LUBBOCK POWER & LIGHT
Director
(Approved as to content)
By: C
-orney
(Approved as to form)
TEXAIS TECH UNIVERSITY
By:
TEXAS TECH UNIVERSITY
HEALTH SCIENCES CENTER
EXHIBIT C-1
List of LP&L's Customers
Comparable to Texas Tech
as of 2-1-88
EXHIBIT "C-1"
List of LP&L's Customers
Comparable to Texas Tech
as of 2-1-88
(ELECTRIC ACCOUNTS FOR RATE 16)
Wal-Mart Stores, Inc. #01-945
Sam's Wholesale Club #8270
Wal-Mart Stores, Inc. #01-0861
Target Discount Store
Albertson's #4213
T G & Y 900-11
Lubbock General Hospital
K -Mart Store 7218
K -Mart Store 4354
Lubbock Capital Corp.
Rainbo Baking Co.
Southwestern Bell #XP4537
Lubbock Avalanche Journal
Methodist Hospital
Plains Cotton Co-op
Lubbock County Jail
Waples West
Plains Co-op Oil Mills,
Inc.
Furrs Super Market #33 Texas Tech University
Coca Cola Bottling Co. Purina Mills Inc.
.Lubbock Country Club United Super Market
Albertson's Lubbock Cotton Oil Mill
Montgomery Ward Inc. Lubbock Linen Service
Education Service Weingarten Realty Mgt. Co
Trion Realty Co. American State Bank
Court Place Inc. Court House
Blankenship Development (Town & Country Shopping Center)
EXHIBIT "C-1"
9 •
LUBBOCK POWER & LIGHT
P.O. BOX 2000 • LUBBOCK, TEXAS 79457 • (806) 763-9381
LP&L RATE SCHEDULE AND TARIFFS
LARGE GENERAL SERVICE
TARIFF NUMBER 3.0
APPLICABLE: To all commercial and industrial electric
service supplied where facilities of adequate capacity
and suitable voltage are adjacent to the premises to be
served.
Not applicable to temporary, breakdown, standby, or
supplementary service.
TERRITORY: Lubbock, Texas
RATE: Demand Charge: $1,960.00 for the first 200 KW, or
less of demand per month
$ 9.10 per kW for all additional
KW of demand per month
Energy Charge: 0 .55G per KWh for the first 230 KWh
used per month per KW of demand, or
the first 120,000 KWh used per month,
whichever is greater.
0.410 per KWh for the next 230 KWh
used per month per KW of demand.
0.334 per KWh for all additional KWh
used per month.
TERMS OF PAYMENT: 5% added to bill after 22 days.
DETERMINATION OF DEMAND: The KW determined from Lubbock
Power and Light's demand meter for the 30 -minute period
of customer's greatest KW use during the month, but not
less than 60% of the highest demand established in the
preceding eleven months.
POWER FACTOR ADJUSTMENT: Bills computed under the above
rate will be increased $0.25 for each kvar by which the
reactive demand exceeds, numerically, 0.53 times the
measured KW demand, and will be reduced $0.25 for each
kvar by which the reactive demand is less than,
numerically, 0.40 times the measured KW demand.
PRIMARY SERVICE DISCOUNT: A discount of 3% of the demand
charges, energy charges (excluding all fuel cost
recovery amounts), and power factor adjustment charges
will be allowed when service is supplied at a line
voltage of 12 kv, or greater, and no transformation is
made by Lubbock Power and Light at the customer's
location.
FUEL COST RECOVERY: The charge per kilowatt hour of the
above rate shall be increased by a fuel factor per
kilowatt hour as provided in current Southwestern
Public Service Tariff 7100.
TAX ADJUSTMENT: Billings under this schedule may be
increased by an amount equal to the sum of the taxes
payable under federal, state and local sales tax acts,
and of all additional taxes, fees, or charges,
(exclusive of ad valorem, state and federal income
taxes) payable by the utility and levied or assessed by
any governmental authority on the public utility
services rendered, or on the right or privilege of
rendering the service, or on any object or event
incidental to the rendition of the service, as the
result of any new or amended laws after June 30,
1965.
CHARACTER OF SERVICE: A -C; 60 hertz; at one standard
voltage.
CONTRACT PERIOD: A period of not less than one year.
MINIMUM CHARGE: The Demand Charge.
EFFECTIVE DATE April 1,1988
EXHIBIT "C-2"
(Base Steam Rates)
EXHIBIT "C-2"
BASE STEAM RATES
STEAM PRICES AS A FUNCTION OF GAS PRICES
If the actual gas prices are equal to or less than the assumed gas prices,
then the base steam price will equal the above shown steam prices.
If the actual gas prices are greater than the assumed gas prices, then the base
steam price will equal the above shown steam price plus 0.110724 times the
difference between the actual gas price and the assumed gas price.
EXAMPLE:If in the year 2008 the actual gas price is $5.00/MMBTU, then the base
steam price would be (0.110724)($5.00-54.00)+$0.91493 or the base steam price
would be $1.025654 per 1000 The of steam.
ASSUMED
PRICES
ASSUMED
PRICES
GAS
PER
GAS
PER
PRICES
1000 LBS
PRICES
1000 LBS
YEAR
-------------------------------
MMBTU
STEAM
YEAR
MMBTU
STEAM
1989
$2.50
$0.93046
------------------------------
2009
53.34
$0.94006
1990
52.56
$0.91151
2010
$3.43
$0.96589
1991
$2.63
$0.89365
2011
$3.51
$0.99242
1992
$2.69
$0.87693
2012
$3.60
$1.01968
1993
$2.76
$0.86142
2013
$3.69
$1.04769
1994
$2.83
$0.84716
1995
$2.90
$0.83421
21-25 YR
1996
$2.97
$0.82264
AVERAGE
$3.51
$0.99315
1997
$3.05
$0.81330
1998
$3.12
$0.80977
1999
$3.20
$0.80818
2014
$3.78
$1.07647
2000
$3.28
$0.80860
2015
$3.88
$1.10604
2001
$3.36
$0.81120
2016-
$3.97
$1.13G43
2002
$3.45
$0.81784
2017
$4.07
$1.16764
2003
$3.53
$0.83006
2018
$4.17
$1.19972
2004
$3.62
$0.83894
2005
$3.71
$0.85345
26-30 YR
2006
$3.80
$0.87092
AVERAGE
$3.98
$1.13726
2007
$3.90
$0.89135
2008
$4.00
$0.91493
2019
$4.28
$1.23267
1-20 YR
2020
$4.39
$1.26654
AVERAGE
$3.19
$0.85233
2021
$4.50
$1.30133
2022
$4.61
$1.33708
2023
$4.72
$1.37381
31-35 YR
AVERAGE
$4.50
$1.30228
If the actual gas prices are equal to or less than the assumed gas prices,
then the base steam price will equal the above shown steam prices.
If the actual gas prices are greater than the assumed gas prices, then the base
steam price will equal the above shown steam price plus 0.110724 times the
difference between the actual gas price and the assumed gas price.
EXAMPLE:If in the year 2008 the actual gas price is $5.00/MMBTU, then the base
steam price would be (0.110724)($5.00-54.00)+$0.91493 or the base steam price
would be $1.025654 per 1000 The of steam.
EXHIBIT C-3
(Steam Availability)
EXHIBIT C-3
STEAM AVAILABILITY
YEAR
PERCENT AVAILABILITY
NUMBER OF DAYS
TO SUPPLY STEAM
OF DOWN TIME
1
0
0
2
93
25
3
92
29
4
92
29
5
92
29
6
91
33
7
91
33
8
91
33
9
90
36
10
90
36
11
90
36
12
89
40
13
89
40
14
89
40
15
88
44
16
88
44
17
88
44
18
87
47
19
87
47
20
87
47
20+
As agreed by parties
1. STEAM TO BE SUPPLIED BY LP&L
_ steam to _ (table
percent availability from
Q be su hed) — ( 40,000 pounds per hour � (8760 hours Jpp above for appropriate year
2. STEAM PURCHASED BY TEXAS TECH
3.
P1 =
steam purchased _ sum of steam purchased per sum of hours steam is
by Texas Tech hour by Texas Tech ) ( available from LP&L )
P2 =
(steam available _ sum of steam available per sum of hours steam is
to Texas Tech — ( hour to Texas Tech ) ( available from LP&L )
If P1 or P2, whichever is greater, is equal to or greater than Q, then that year's availability has been
met. If Q is greater than P1 or P2, then steam availability has not been met and the steam credit due Texas
Tech shall be calculated as follows:
P1 or P2 l
(cost of gas for appropriate) ( 1185 BTU 1
$ _ amount to be credited year from Exhibit C-1 J `pouf steam)_
team f
to Texas Tech ) �Q .8