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COOPE RATIVE AGREEMENT FOR INTERCONNECTION AND PARALLEL OPERATION (Tri-County Electric Cooperative)

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COOPE

RATIVE AGREEMENT FOR INTERCONNECTION AND PARALLEL

OPERATION OF DISTRIBUTED GENERATION

CONTRACT

This Interconnection Agreement ("Agreement") is made and entered into this

_____ day of __________________, 20__,by Tri-County Electric Cooperative, Inc.,

("Cooperative"), a corporation organized under the laws of the State of Texas, and

("DG Owner/Operator"), each hereinafter

sometimes referred to individually as "Party" or both referred to collectively as the "Parties."

In consideration of the mutual covenants set forth herein, the Parties agree as follows:

1. Scope of Agreement: This Agreement is applicable to conditions under which the

Cooperative and the DG Owner/Operator agree that one or more generating facilities

(described in Exhibit A) owned by the DG Owner/Operator of 10 MW or less, to be

interconnected at 25 kV or less ("Facilities") may be interconnected to the Cooperative's

electric power distribution system ("System"). The provisions of the Cooperative’s

Distributed Generation Manual shall be considered to be a part of this contract.

2. Establishment of Point of Interconnection: The point where the electric energy first

leaves the wires or facilities owned by the Cooperative and enters the wires or facilities

provided by DG Owner/Operator is the "Point of Interconnection." Cooperative and DG

Owner/Operator agree to interconnect the Facilities at the Point of Interconnection in

accordance with the Cooperative's Rules and Regulations and DG Manual relating to

interconnection of Distributed Generation (the "Rules") and as described in the

attached Exhibit A. The interconnection equipment installed by the customer

("Interconnection Facilities") shall be in accordance with the Rules as well.

3. Responsibilities of Cooperative and DG Owner/Operator for Installation,

Operation and Maintenance of Facilities: DG Owner/Operator will, at its own cost

and expense, operate, maintain, repair, and inspect, and shall be fully responsible for,

its Facilities, unless otherwise specified on Exhibit A. DG Owner/Operator shall

conduct operations of its Facilities in compliance with all aspects of the Rules, and

Cooperative shall conduct operations of its electric distribution facilities in compliance

with all aspects of the Rules, or as further described and mutually agreed to in the

applicable Facilities Schedule. Maintenance of Interconnection Facilities shall be

performed in accordance with the applicable manufacturers' recommended

maintenance schedule. The DG Owner/Operator agrees to cause its Interconnection

Facilities to be constructed in accordance with specifications equal to or better than

those provided by the National Electrical Safety Code and the National Electrical

Code, both codes approved by the American National Standards Institute, in effect at the

time of construction. The DG Owner/Operator covenants and agrees to cause the

design, installation, maintenance, and operation of, its Interconnection Facilities so as

to reasonably minimize the likelihood of a malfunction or other disturbance, damaging

or otherwise affecting or impairing the System. DG Owner/Operator shall comply with

all applicable laws, regulations, zoning codes, building codes, safety rules and

environmental restrictions applicable to the design, installation and operation of its

Facilities.

Cooperative will notify DG Owner/Operator if there is evidence that the Facilities'

operation causes disruption or deterioration of service to other customer(s) served from

the System or if the Facilities' operation causes damage to the System. DG

Owner/Operator will notify the Cooperative of any emergency or hazardous

condition or occurrence with the DG Owner/Operator's Facilities, which could affect

safe operation of the System.

4. Operator in Charge: The Cooperative and the DG Owner/Operator shall each identify

an individual (by name or title) who will perform as "Operator in Charge" of the facilities

and their section of the Interconnection Facilities. This individual must be familiar with

this Agreement as well as provisions of other agreements and any regulations that may

apply.

5. Limitation of Liability and Indemnification

a. Notwithstanding any other provision in this Agreement, with respect to the

Cooperative's provision of electric service to DG Owner/Operator and the

services provided by the Cooperative pursuant to this Agreement, Cooperative's

liability to DG Owner/Operator shall be limited as set forth in the Cooperative's

tariffs and terms and conditions for electric service, which are incorporated herein

by reference.

b. Neither Cooperative nor DG Owner/Operator shall be liable to the other for

damages for any act or omission that is beyond such party's control, including,

but not limited to, any event that is a result of an act of God, labor disturbance,

act of the public enemy, war, insurrection, riot, fire, storm, flood, explosion,

breakage or accident to any part of the System or to any other machinery or

equipment, a curtailment, law, order, or regulation or restriction by

governmental, military, or lawfully established civilian authorities.

c. Notwithstanding Paragraph 5.b of this Agreement, the DG Owner/Operator

shall assume all liability for, and shall indemnify Cooperative for, any claims,

losses, costs, and expenses of any kind or character to the extent that they

result from DG Owner/Operator's negligence or other wrongful conduct in

connection with the design, construction or operation of the Facilities or

Interconnection Facilities. Such indemnity shall include, but is not limited

to, financial responsibility for (a) monetary losses; (b) reasonable costs and

expenses of defending an action or claim; (c) damages related to death or injury;

(d) damages to property; and (e) damages for the disruption of business. This

paragraph does not create a liability on the part of the DG Owner/Operator

to the Cooperative or a third person but requires indemnification where such

liability exists.

d. Cooperative and DG Owner/Operator shall each be responsible for the safe

installation, maintenance, repair and condition of their respective lines, wires,

switches, or other equipment or property on their respective sides of the Point

of Interconnection. The Cooperative, while retaining the right to inspect, does

not assume any duty of inspecting the DG Owner/Operator's lines, wires,

switches, or other equipment or property and will not be responsible, therefore.

DG Owner/Operator assumes all responsibility for the electric service supplied

hereunder and the facilities used in connection therewith at or beyond the Point

of Interconnection.

e. For the mutual protection of the DG Owner/Operator and the Cooperative, only

with Cooperative prior written authorization are the connections between the

Cooperative's service wires and the DG Owner/Operator's service entrance

conductors to be energized.

6. Design Reviews and Inspections: The DG Owner/Operator shall provide to the

Cooperative the following documentation and inspection results:

a. One-Line Diagram. The diagram shall include at a minimum, all major

electrical equipment that is pertinent to understanding the normal and

contingency operations of the DG Interconnection Facilities, including

generators, switches, circuit breakers, fuses, protective relays and instrument

transformers.

b. Testing Records. Testing of protection systems shall be limited to records of

compliance with standard acceptance procedures and by industry standards

and practices. These records shall include testing at the start of commercial

operation and periodic testing thereafter.

7. Right of Access, Equipment Installation, Removal & Inspection: The Cooperative

may send an employee, agent or contractor to the premises of the DG Owner/Operator

at any time whether before, during or after the time the Facilities first produces energy

to inspect the Interconnection Facilities, and observe the Facility's installation,

commissioning (including any testing), startup, and operation. At all times Cooperative

shall have access to DG Owner/Operator's premises for any reasonable purpose in

connection with the interconnection described in this Agreement, the Rules, or to

provide service to its customers.

8. Confidentiality of Information: Unless compelled to disclose by judicial or

administrative process, or by other provisions of law or as otherwise provided for in

this Agreement, the DG Owner/Operator and the Cooperative will hold in confidence

any and all documents and information furnished by the other party in connection with

this Agreement.

9. Prudent Operation and Maintenance Requirements: The DG Owner/Operator shall

operate and maintain its generation and interconnection facilities in accordance with

industry standard prudent electrical practices. The said standards shall be those in

effect at the time a DG Owner/Operator executes an interconnection agreement with the

Cooperative.

10. Disconnection of Unit: DG Owner/Operator retains the option to disconnect its

Facilities from the System, provided that DG Owner/Operator notifies the Cooperative

of its intent to disconnect by giving the Cooperative at least thirty

(30) days' prior written notice. Such disconnection shall not be a termination of the

agreement unless DG Owner/Operator exercises rights under Section 13.

DG Owner/Operator shall disconnect Facilities from the System upon the effective date

of any termination under Section 13.

Subject to the Rules, for routine maintenance and repairs on the System, Cooperative

shall provide DG Owner/Operator with seven (7) business days' notice of service

interruption.

Cooperative shall have the right to suspend service in cases where continuance of

service to DG Owner/Operator will endanger persons or property. During the forced

outage of the System serving DG Owner/Operator, Cooperative shall have the right to

suspend service to effect repairs on the System, but the Cooperative shall use its

efforts to provide the DG Owner/Operator with reasonable prior notice.

11. Metering: Metering shall be accomplished as described in the Cooperative’s DG

Manual.

12. Insurance: Insurance shall be required as described in the Cooperative’s DG

Manual.

13. Effective Term and Termination Rights: This Agreement becomes effective when

executed by both Parties and shall continue in effect until terminated. This agreement

may be terminated as follows: (a) DG Owner/Operator may terminate this Agreement

at any time by giving the Cooperative sixty days' written notice; (b) Cooperative may

terminate upon failure by the DG Owner/Operator to generate energy from the Facilities

in parallel within six (6) months after completion of the interconnection; (c) either Party

may terminate by giving the other Party at least thirty

14. Dispute Resolution: Each party agrees to attempt to resolve any and all disputes

arising hereunder promptly, equitably and in good faith. If a dispute arises under

this Agreement that cannot be resolved by the parties within forty-five (45) working days

after written notice of the dispute, the parties agree to submit the dispute to mediation

by a mutually acceptable mediator. The parties agree to participate in good faith in the

mediation for thirty (30) days. If the parties are unsuccessful in resolving their dispute

through mediation, then the parties shall submit to arbitration pursuant to the

Commercial Arbitration Rules of the American Arbitration Association. The venue of

such arbitration shall be by Tri-County.

15. Compliance with Laws, Rules and Tariffs: Both the Cooperative and the DG

Owner/Operator shall be responsible for complying with all applicable laws, rules

and regulations, including but not limited to the laws of the state of Texas, and the

Cooperative's DG Manual, Tariffs, Rules and Regulations, By-Laws and other

governing documents. The interconnection and services provided under this

Agreement shall at all times be subject to the terms and conditions set forth in the tariff

schedules and rules of the Cooperative as applicable to the electric service provided by

the Cooperative, which tariffs and rules are hereby incorporated into this Agreement by

this reference. The Cooperative shall have the right to publish changes in rates,

classification, service or rule, with the proper notification to all DG owners/operators

and Cooperative members.

16. Severability: If any portion or provision of this Agreement is held or adjudged for

any reason to be invalid or illegal or unenforceable by any court of competent

jurisdiction, such portion shall be deemed separate and independent, and the

remainder of this Agreement shall remain in full force and effect.

17. Amendment: This Agreement may be amended only upon mutual agreement of

the Parties, which amendment will not be effective until reduced to writing and executed

by the Parties.

18. Entirety of Agreement and Prior Agreements Superseded: This Agreement,

including the Rules and all attached Exhibits and Facilities Schedules, which are

expressly made a part hereof for all purposes, constitutes the entire agreement and

understanding between the Parties with regard to the interconnection of the facilities of

the Parties at the Points of Interconnection expressly provided for in this Agreement.

The Parties are not bound by or liable for any statement, representation, promise,

inducement, understanding, or undertaking of any kind or nature (whether written or

oral) with regard to the subject matter hereof not set forth or provided for herein or in

the DG Owner/Operator application, or other written information provided by the DG

Owner/Operator in compliance with the Rules. It is expressly acknowledged that the

Parties may have other agreements covering other services not expressly provided

for herein, which agreements are unaffected by this Agreement.

19. Majeure: For the purposes of this Agreement, a Force Majeure event is any event:

a) that is beyond the reasonable control of the affected party; and (b) that the affected

party is unable to prevent or provide against by exercising reasonable diligence,

including the following events or circumstances, but only to the extent that they

satisfy the preceding requirements: acts of war, public disorder, rebellion or

insurrection; floods, hurricanes, earthquakes, lighting, storms or other natural

calamities; explosions or fires; strikes, work stoppages or labor disputes;

embargoes; and sabotage. If a Force Majeure event prevents a party from

fulfilling any obligations under this agreement, such party will promptly notify the

other party in writing and will keep the other party informed on a continuing basis

as to the scope and duration of the Force Majeure event. The affected party will

specify the circumstances of the Force Majeure event, its expected duration and

the steps that the affected party is taking to mitigate the effect of the event on its

performance. The affected party will be entitled to suspend or modify its

performance of obligations under this Agreement but will use reasonable efforts to

resume its performance as soon as possible.

20. Assignment: The DG Owner/Operator shall not assign or otherwise dispose of the

Agreement or any of its right or interest hereunder.

21. Permits, Fees and Approvals: The Cooperative will have responsibility for the review,

approval or rejection of the DG interconnection application. The approval process is

intended to ensure that the implementation of the applicant's DG project will not

adversely affect the safe and reliable operation of the Cooperative's System. The fees

associated with the Application are listed in the most current fee schedule issued

by the Cooperative. All fees paid by third parties are to be submitted in the form of a

check along with the Application unless other payment terms have been approved in

advance by the Cooperative. There will be a monthly $12 distributed generation charge

on the member’s bill to offset O&M expenses incurred by the Cooperative.

22. Notices: Notices given under this Agreement are deemed to have been duly delivered

if hand delivered or sent by United States certified mail, return receipt requested,

postage prepaid, to:

23. Invoicing and Payment: Invoicing and payment terms for services associated with this

Agreement shall be consistent with applicable Rules of the Cooperative.

24. Limitations (No Third-Party Beneficiaries, Waiver, etc.): This Agreement is not

b) If to Tri-County Electric Cooperative

Tri-County Electric Cooperative, Inc.

200 Bailey Ranch Rd.

Aledo, TX 76008

a) If to DG Owner/Operator:

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. 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 to waive

the obligations, rights, or duties imposed upon the Parties.

25. Headings: The descriptive headings of the various articles and sections of this

Agreement have been inserted for convenience of reference only and are to be afforded

no significance in the interpretation or construction of this Agreement.

26. 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.

IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed by

their respective duly authorized representatives.

TRI-COUNTY ELECTRIC COOPERATIVE [DG OWNER/OPERATOR SIGNATURE]

BY: BY:

TITLE: TITLE: _________________________

DATE: DATE: _________________________

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