{"id":42639,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/operation-and-offtake-contract-anhui-provincial-electric-power.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"operation-and-offtake-contract-anhui-provincial-electric-power","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/operation-and-offtake-contract-anhui-provincial-electric-power.html","title":{"rendered":"Operation and Offtake Contract &#8211; Anhui Provincial Electric Power Corp., Anhui Liyuan-AES Power Company Ltd. and Hefei Zhongli Energy Company Ltd."},"content":{"rendered":"<pre>\n   Information contained herein, marked with [***], is being filed separately\n     with the Commission pursuant to a request for confidential treatment.\n\n\n\n\n                   ANHUI PROVINCIAL ELECTRIC POWER CORPORATION\n\n                                       AND\n\n                       ANHUI LIYUAN-AES POWER COMPANY LTD.\n                                       AND\n                        HEFEI ZHONGLI ENERGY COMPANY LTD.\n\n\n\n\n\n\n\n                         OPERATION AND OFFTAKE CONTRACT\n                                       OF\n                        HEFEI COMBINED-CYCLE POWER PLANT\n\n\n\n\n\n\n\n\n\n\n\n\n                                 SEPTEMBER, 1996\n\n\n\n\n\n\n\n                                TABLE OF CONTENTS\n\n                                                                      PAGE\n\nCHAPTER 1   GENERAL.....................................................3\n\nCHAPTER 2   DEFINITIONS.................................................3\n\nCHAPTER 3   REPRESENTATIONS, WARRANTIES AND COMMITMENTS\n            OF THE  PARTIES ............................................8\n\nCHAPTER 4   CONDITIONS AND REQUIREMENTS FOR INTERCONNECTION OF THE\n            POWER PLANT................................................12\n\nCHAPTER 5   METERING OF ELECTRICITY....................................13\n\nCHAPTER 6   OPERATION OF THE POWER PLANT...............................13\n\nCHAPTER 7   RESPONSIBILITIES OF PARTY B AND PARTY A....................17\n\nCHAPTER 8   OTHER OPERATION MATTERS....................................19\n\nCHAPTER 9   ON-GRID QUANTITY...........................................19\n\nCHAPTER 10  ON-GRID TARIFF AND SETTLEMENT OF ELECTRICITY FEE...........20\n\nCHAPTER 11  RESPONSIBILITY AND INDEMNITY...............................24\n\nCHAPTER 12  DEFAULT AND TERMINATION....................................25\n\nCHAPTER 13  FORCE MAJEURE..............................................27\n\nCHAPTER 14  INSURANCE..................................................29\n\nCHAPTER 15  GOVERNING LAWS AND DISPUTE RESOLUTION......................30\n\nCHAPTER 16  ASSIGNMENT.................................................32\n\nCHAPTER 17  NOTICE.....................................................32\n\nCHAPTER 18  OTHER PROVISIONS...........................................33\n\nAPPENDIX 1  INVOICE FORMAT.............................................37\n\nAPPENDIX 2  AFTER-TAX CAPITAL RETURN...................................39\n\nAPPENDIX 3  CALCULATION OF TERMINATION FEES............................40\n\nAPPENDIX 4  ON-GRID TARIFF FORMULA.....................................41\n\nAPPENDIX 5  METERING AND RECORDING OF ELECTRICAL ENERGY................51\n\nAPPENDIX 6  PRE-OPERATION AND OPERATION SERVICES.......................53\n\nAPPENDIX 7  NECESSARY INSURANCE........................................59\n\nAPPENDIX 8  FUEL SPECIFICATION.........................................60\n\nAPPENDIX 9 FUEL OIL SUPPLY CONTRACT....................................61\n\n\n\n\n\n                                CHAPTER 1 GENERAL\n\n         This Operation and Offtake Contract  (hereinafter  referred to as \"this\nContract\") was entered into on ------- 1996 in Hefei City, the People's Republic\nof China between the Anhui Provincial Electric Power Corporation on the one part\n(hereinafter  referred  to as  \"Party  A\")  and a  consortium  comprising  Anhui\nLiyuan-AES Power Company Ltd. and Hefei Zhongli Energy Company Ltd. on the other\npart (each a  Sino-foreign  cooperative  joint  venture  company,  organized and\nexisting  under the laws of the  People's  Republic  of China  and  collectively\nreferred to as \"Party B\", and separately  referred to as \"Liyuan-AES\" and \"Hefei\nZhongli\" respectively,  together being jointly and severally responsible for the\nliabilities and obligations of Party B hereunder). In this Contract, Party A and\nParty B are individually termed as the \"Party\" or collectively as \"the Parties\".\nThe Parties reached the following  agreement  through friendly  consultations in\naccordance with relevant laws and regulations of the People's  Republic of China\nand on the basis of the principles of equality and mutual benefit.\n\n                              CHAPTER 2 DEFINITIONS\n\n2.01     DEFINITIONS\n\n         Unless  otherwise  stated  in the  provisions  of  this  Contract,  the\nfollowing terms, either in singular or plural, shall have the meanings set forth\nbelow:\n\n          1)   \"AFTER-TAX  CAPITAL  RETURN\"  shall mean the amount in respect of\n               each Year set out in Appendix 2 representing  the return to Party\n               B on its  investment  in the Power  Plant at the  Annual  Minimum\n               On-Grid Quantity.\n\n          2)   \"ANNUAL ACTUAL ON-GRID  QUANTITY\"  means the On-Grid  Quantity of\n               electricity  generated  by the  Power  Plant as  measured  at the\n               Delivery  Point,  dispatched  by Party A and which this  Contract\n               requires is purchased by Party A in any Year.\n\n          3)   \"ANNUAL  GENERATION  PLAN\" means the plan proposed in November of\n               each Year by Party A,  agreed by Party B, that  allows  the Power\n               Plant to at least generate the Annual Minimum On-Grid Quantity.\n\n          4)   \"ANNUAL MINIMUM  ON-GRID  QUANTITY\" shall mean the annual minimum\n               quantity to be  generated by the Power Plant (prior to the Tariff\n               Commencement  Date of the ST Unit is as  specified in Clause 9.01\n               and thereafter  will,  subject to Clause 9.01(3),  stand at [***]\n               kwh) which is sold to the Party A and purchased and to be paid on\n               time by Party A in accordance with the \"Take or Pay\" principle in\n               every Year during the Commercial Operation Period.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n          5)   \"APPROVED GENERATION COST\" shall mean in respect of a given Year,\n               the Planned Generation Cost(in RMB Fen per KWH),  approved by the\n               Anhui Provincial Pricing Bureau.\n\n          6)   \"CHANGES  OF LAW\"  shall mean the  promulgation,  implementation,\n               amendment,   reinterpretation  or  repeal  of  any  laws,  taxes,\n               withholding taxes, regulations,  rules or policies by any Chinese\n               governmental  authority  relevant to the construction,  operation\n               and maintenance of the Power Plant, the production,  delivery and\n               sale  of  electrical  energy,  or any  other  matters  since  the\n               execution  of  this  Contract;  or the  promulgation,  extension,\n               amendment or withdrawal of any approval, consent or permit by any\n               Chinese  governmental  authority  relevant  to the  construction,\n               operation and  maintenance  of the Power Plant,  the  production,\n               delivery and sale of electrical energy or any other matters which\n               has  resulted in the failure of Party B to achieve its  After-tax\n               Capital  Return or of the  Investors  to receive  their  expected\n               profit as set out in the Joint Venture Contracts or otherwise has\n               a material and adverse impact upon the rights and  obligations of\n               Party B or the Investors in other respects.\n\n          7)   \"CERTIFICATE   OF   PERFORMANCE   ACCEPTANCE\"   shall   mean  the\n               certificate  which,   according  to  Clause  5.3.3.  of  the  EPC\n               Contract,  shall be agreed to by the Owner's  Engineer in writing\n               and  signed by the  Parties  in  respect  of the  achievement  of\n               Performance Acceptance of a Generating Unit or the Power Plant.\n\n          8)   \"COMMERCIAL OPERATION DATE\" shall mean in respect of a Generating\n               Unit or the Power Plant the date specified in the  Certificate of\n               Performance  Acceptance  which is issued pursuant to Clause 5.3.3\n               of the EPC Contract.\n\n          9)   \"COMMERCIAL  OPERATION  PERIOD\"  shall mean the  period  from the\n               Commercial  Operation  Date of the  Power  Plant  to the  date of\n               termination of the Joint Venture Contract.\n\n          10)  \"COMMISSIONING\"  shall  mean the  testing  of the  Power  Plant (\n               including  Performance  Test and  Reliability  Run) in accordance\n               with Article 5 of EPC Contract.\n\n          11)  \"DELIVERY  POINT\" means the physical  point where the Power Plant\n               and the Grid are to be connected at the Site as more particularly\n               described in Clause 4.02.\n\n          12)  \"EPC  CONTRACT\"  shall  mean  the  engineering,  procurement  and\n               construction  services contract entered into by and between Party\n               B and the EPC Contractor on -------- 1996.\n\n          13)  \"EPC  CONTRACTOR\"  shall mean the Anhui Mingda Electric Power EPC\n               Contract Company Ltd.\n\n          14)  \"EXCESS ON-GRID QUANTITY\" shall mean the portion of Annual Actual\n               On-grid Quantity which is in excess of the Annual Minimum On-Grid\n               Quantity in a Year.\n\n\n          15)  \"FUEL OIL SUPPLY  CONTRACT\" shall mean a contract entered into by\n               and  between  Party A as operator of the Power Plant and the fuel\n               oil  supplier for the  long-term  supply of fuel oil to the Power\n               Plant that  satisfies  the Fuel  Specification.  For  details see\n               Appendix 9 hereof.\n\n          16)  \"FUEL  SPECIFICATION\"  means  the fuel  specification  set out in\n               Appendix 8.\n\n          17)  \"GENERATING  UNIT\"  shall mean any one of the two GT Units or the\n               ST Unit which form the component parts of the Power Plant.\n\n          18)  \"GT#1  UNIT\"  shall mean the first gas  turbine  generating  unit\n               which is  composed of PG6551B and its  ancillary  facilities  and\n               which will go into operation first.\n\n          19)  \"GT#2  UNIT\" shall mean the second gas  turbine  generating  unit\n               which is  composed of PG6551B and its  ancillary  facilities  and\n               which will go into operation after the GT#1 Unit.\n\n          20)  \"INHERIT  EQUIPMENT  DEFECTS\" shall mean the defects of the major\n               equipments  of the  Power  Plant  (gas  turbine,  steam  turbine,\n               generator) which could not be found during the  Commissioning and\n               warranty period,  and is of manufacturing  defects in nature, and\n               is not caused by normal  wear and tear and  degredation,  and can\n               not be prevented with monitoring and maintenance(ie. such defects\n               causing  the  forced   outages  of  the  Power  Plant   exceeding\n               thirty(30) days accumulatively in a given Year). Such defects can\n               only be called  Inherit  Equipment  Deftects  if only the Parties\n               agree or after the  conclusive  determination  by the  Experts in\n               accordance  with Section 15.03 of this Contract,  and the Experts\n               can only be selected from world renowned independent  engineering\n               firms or the members of related committee of the IEEE.\n\n          21)  \"INTERCONNECTION  CONTRACT\"  shall mean the contract  executed by\n               and between  Party B and Party A for the  connection of the Power\n               Plant to the Power Grid.\n\n          22)  \"INTERCONNECTION  FACILITIES\"  means all facilities and equipment\n               including   any   telecommunications    systems   and   equipment\n               telemetering   equipment,   transmission   lines  and  associated\n               equipment  transformers  and  associated  equipment;   relay  and\n               switching  equipment and protective  devices and safety equipment\n               which must be constructed or installed to connect the Power Plant\n               to the first transmission tower of the Grid.\n\n          23)  \"INVESTOR\" means each of Anhui Liyuan Electric Power  Development\n               Company  limited,  Hefei  municipal  Construction  and Investment\n               Company and AES Anhui Power Company Ltd.\n\n          24)  \"JOINT VENTURE  CONTRACTS\"  shall mean the contracts  executed on\n               March 18 , 1996 and --------,  1996  respectively  by and between\n               Anhui Liyuan  Electric  Power  Development  Company  Ltd.,  Hefei\n               Municipal Construction and Investment Company and AES-Anhui Power\n               Company Ltd. As well as all  subsequent  Admendments to the above\n               contracts in connection with the establishment and reorganization\n               of the Anhui  Liyuan-AES Power Company Ltd. and the Hefei Zhongli\n               Energy Company Ltd.\n\n          25)  \"LAND AND  FACILITY  LEASE  AGREEMENT\"  shall mean the  agreement\n               entered  into by and  between  Party B and the  owner of the land\n               useright and facility in  connection  with the lawful use of part\n               of the land and facility  within the Hefei Power Plant during the\n               term of the Joint Venture.\n\n          26)  \"LENDER\" shall mean any legal person or natural person  providing\n               financing for the Power Plant.\n\n          27)  \"LOAN REPAYMENT DATE\" shall mean the date on which the principal,\n               interest, expenses, costs and all other amounts payable under the\n               US$ Loan Contracts have been completely repaid in accordance with\n               the US$ Loan Contracts.\n\n          28)  \"MONTH\" shall mean a calendar month.\n\n          29)  \"ON-GRID QUANTITY\" means quantity of active electricity  measused\n               at the metering point and sold to Party A.\n\n          30)  \"ON-GRID  TARIFF\" shall mean the on-grid  tariff per KWH which is\n               approved by Anhui Provincial  Pricing Bureau.  The On-grid Tariff\n               shall be determined  and adjusted in accordance  with the On-grid\n               Tariff Formula in Appendix 4.\n\n          31)  \"ON-GRID  TARIFF  FORMULA\"  shall mean the document  agreed to by\n               both Parties and approved by the Anhui Provincial  Pricing Bureau\n               which  stipulates  the  initial  On-grid  Tariff  and  subsequent\n               On-grid tariff  adjustment as more fully  described in Appendix 4\n               hereof.\n\n          32)  \"OPERATION  SERVICES\" means the services  described in Part II of\n               Appendix 6.\n\n          33)  \"OWNER'S   ENGINEER\"  shall  mean  the  independent   engineering\n               consultant  or  engineering  firm with  international  reputation\n               which is engaged by Party B to be responsible  for monitoring and\n               supervising  the EPC  Contractor in  performing  the EPC Contract\n               including  engineering,   design,  construction  and  performance\n               acceptance under the EPC Contract.\n\n          34)  \"POWER  GRID\"  shall mean the  electricity  transmission  grid of\n               Anhui Province.\n\n          35)  \"POWER PLANT\" shall mean the total facilities of a combined cycle\n               generating set (the gross output under ISO condition is 115.2 MW)\n               consisting of 2 GT Units,  one ST Unit, the heat recovery boilers\n               and the relevant equipment,  the control equipment and all common\n               facilities,  ancillary facilities the Interconnection  Facilities\n               and the Site.\n\n          36)  \"PRE-OPERATION  SERVICES\" means the services  described in Part I\n               of Appendix 6.\n\n          37)  \"PLANNED  GENERATION  COST\"  shall mean for a given Year the cost\n               per KWH to Party A of the generating  the Annual Minimum  On-Grid\n               Quantity  calculated  and  agreed  by  Party  A  and  Party  B in\n               accordance  with clause 10.03(1) and Appendix 4, and submitted to\n               the Anhui Provincial Pricing Bureau for approval.\n\n          38)  \"PRUDENT UTILITY PRACTICE\" shall mean the international standard,\n               practices   or  methods   generally   followed  for  the  design,\n               construction,  commissioning,  operation and  maintenance  of the\n               Power Plant and the generation and transmission of electricity on\n               the basis of the principles of safety,  high efficiency,  economy\n               and  reliability   and  in  compliance  with  the   manufacturers\n               recommendations.\n\n\n          39)  \"QUARTER\" shall mean a calendar  quarter(for  example,  the first\n               quarter of a Year shall mean January, February and March)\n\n          40)  \"RENMINBI OR RMB\" shall mean the lawful  currency of the People's\n               Republic of China.\n\n          41)  \"STANDARD  OIL  CONSUMPTION\"  shall mean the oil  consumed by the\n               Power Plant based on the  Characteristic of gas turbine including\n               additional  fuel  consumption for  degradation,  stirrup and shut\n               down.\n\n          42)  \"SITE\" shall mean the land located at Hefei City, Anhui Province,\n               People's  Republic of China  leased by Party B on which the Power\n               Plant  will be  constructed  as more  particularly  described  in\n               Appendix G of the EPC Contract.\n\n          43)  \"ST  UNIT\"  shall  mean the VEGA 206 steam  turbine  unit and its\n               ancillary  facilities  which will make use of exhaust heat of the\n               gas turbines to generate electricity.\n\n          44)  \"TAKE  OR PAY\"  shall  mean  that  except  in the case of a Force\n               Majeure event  stipulated  in this Contract or Inherit  Equipment\n               Defects or the Party B's default  stipulated in the Section 12.02\n               hereof,  Party A shall at least pay to Party B the amount for the\n               Annual Minimum On-Grid  Quantity at the On-Grid  Tariff.  Even if\n               Party A decides to reduce its purchase quantity,  or is unable to\n               purchase all the Annual Minimum On-Grid  Quantity,  it has to pay\n               to Party B the same amount as if it has  purchased all the Annual\n               Minimum On-Grid Quantity.\n\n          45)  \"TARIFF  COMMENCEMENT  DATE\" shall mean the  earlier  date of the\n               following:  for the  GT#1  and  GT#2  Units:  (i) the  Commercial\n               Operations  Date of both GT#1 and GT#2  Units,  or (ii) August 1,\n               1997; for the ST Unit: (i) the Commercial  Operations  Date of ST\n               Unit, or (ii) July 1, 1998.\n\n          46)  \"TECHNICAL  SPECIFICATION\"  means the design specification of the\n               Power Plant as referred to in the EPC Contract.\n\n          47)  \"US DOLLAR OR USD OR US$\" shall mean the lawful  currency  of the\n               United States of America.\n\n          48)  \"US$ LOAN  CONTRACTS\"  shall mean US$ loan  contract or contracts\n               entered  by  Liyuan-AES  and\/or  Hefei  Zhongli  with one or more\n               Lenders  by which to  obtain  construction  funds  for the  Power\n               Plant.\n\n          49)  \"US$ LOAN  EXPENSES\"  shall  mean the  total  amount  payable  by\n               Liyuan-AES  and\/or  Hefei  Zhongli to  Lenders  prior to the Loan\n               Repayment Date (including without limitation principal, interest,\n               expenses,  costs or any other  amounts)  pursuant to the US$ Loan\n               Contracts.\n\n          50)  \"VARIABLE  COST\"  shall  mean the cost per KWH for  fuel,  water,\n               materials,  repair  and  maintenance  and  all  other  costs  and\n               expenses that vary directly with the production of electricity by\n               the  Power  Plant as  approved  by the Anhui  Provincial  Pricing\n               Bureau.\n\n\n          51)  \"YEAR\" shall mean a calendar Year from January 1 to December 31.\n\n\n              CHAPTER 3 REPRESENTATIONS, WARRANTIES AND COMMITMENTS\n                                 OF THE PARTIES\n\n3.01     THE PARTIES\n\n         The Parties to this Contract are as follows:\n\n         (1) Party A:  Anhui  Provincial  Electric  Power  Corporation  which is\nestablished  pursuant to Chinese laws and  registered at the Bureau for Industry\nand Commerce of Anhui Province.  It has an independent  status of a legal person\nand its legal address is No. 415 Wuhu Road, Hefei City, Anhui Province.\n\n               Legal representative\n               Name: Guangjie Cheng\n               Title: General Manager\n               Nationality: Chinese\n\n         The  Anhui  Provincial  Electric  Power  Corporation  is an  integrated\nelectric  power  enterprise  of the Anhui  Province  of China is also one of the\nmember  companies  of the  East  China  Electric  Power  Group of  China.  It is\nresponsible  for  the  production,  management,  dispatch  and  construction  of\nelectric power of the whole province,  including the administration of the urban\nand rural electric power trade of the whole province.  The Corporation which has\n42 units directly  under its  jurisdiction  is engaged in diversified  operation\nincluding  electric  power  production,   management,   dispatch,  construction,\nscientific research and education.\n\n         (2) Party B: a consortium  comprising  Anhui  Liyuan-AES Power Company,\nLtd. and Hefei  Zhongli  Energy  Company,  Ltd.  each of which are  Sino-Foreign\ncooperative joint ventures established and existing pursuant to Chinese laws.\n\n               (i)  Anhui Liyuan-AES Power Company,  Ltd. is a limited liability\n                    company  registered  at the local  bureau for  industry  and\n                    commerce.  Its legal  address is No.  415 Wuhu  Road,  Hefei\n                    City, Anhui Province.\n\n                       Legal Representative\n                       Name: Guangjie Cheng\n                       Title: Chairman of the Board of Directors\n                       Nationality: Chinese\n\n               (ii) Hefei Zhongli Energy  Company,  Ltd. is a limited  liability\n                    company  registered  at the local  bureau for  industry  and\n                    commerce.  Its legal  address is No.  415 Wuhu  Road,  Hefei\n                    City, Anhui Province.\n\n                       Legal Representative\n                       Name: Guangjie Cheng\n                       Title: Chairman of the Board of Directors\n                       Nationality: Chinese\n\n3.02   REPRESENTATIONS AND WARRANTIES\n\n         Owing to the  shortage  of  electric  power  supply,  particularly  the\nshortage  of supply in  peaking  capacity  in Anhui  Province,  Party B plans to\ndevelop,  construct and own the Hefei Combined-Cycle Power Plant in the northern\nsuburb of Hefei City,  Anhui  Province.  The facilities of the Power Plant which\ninclude two GT Units,  one ST Unit and other  relevant and ancillary  facilities\nwill be interconnected  with the Power Grid and be placed under the dispatch and\nmanagement of the Party A. The Power Plant will supply  electrical energy to the\nPower  Grid and will be used by the  Hefei  city on a  priority  basis.  Party B\nhereby appoints Party A to operate and maintain the Power Plant.\n\n         As consideration  for Party B's investment in the Power Plant,  Party A\nagrees to purchase the Annual Minimum On-Grid  Quantity every Year in accordance\nwith the principle of \"Take or Pay\".  Party A agrees to operate and maintain the\nPower Plant in accordance with the terms of this Contract.\n\n         To that effect:\n\n         (a) Party A hereby represents and warrants that:\n\n               (1)  Party  A  is  a  state-owned   enterprise   established   in\n                    accordance  with Chinese laws and validly  existing,  it has\n                    observed all applicable Chinese laws, and to the best of its\n                    knowledge it is not aware of any pending  legal action or is\n                    subject  to any legal  proceedings  which  might lead to the\n                    dissolution of Party A:\n\n               (2)  Party A has all the necessary  right and capacity for action\n                    to enter into and perform this Contract,  and has sufficient\n                    financial  resources necessary to make all payments required\n                    to be made by it from time to time pursuant to this Contract\n                    (including without limitation payment for the Annual Minimum\n                    On-Grid  Quantity) and has the capacity to undertake all its\n                    other obligations and liabilities under this Contract.\n\n               (3)  Party A has obtained  all  necessary  approvals  and support\n                    from  the  provincial   government   departments  and  other\n                    relevant departments for its execution and implementation of\n                    this Contract;\n\n         (b) Anhui  Liyuan-AES  Power  Company,  Ltd.  represents  and  warrants\n             as follows:\n\n               (1)  Anhui Liyuan-AES is a Sino-Foreign cooperative joint venture\n                    established  in  accordance  with  Chinese  laws and validly\n                    existing,  it has observed all applicable  Chinese laws, and\n                    to the best of its  knowledge it is not aware of any pending\n                    legal  action or is subject to any legal  proceedings  which\n                    might lead to the dissolution of Liyuan-AES.\n\n               (2)  Anhui  Liyuan-AES  has obtained all the necessary  right and\n                    capacity to execute and perform this Contract.\n\n         (c) Hefei Zhongli represents and warrants as follows:\n\n               (1)  Hefei Zhongli is a  Sino-Foreign  cooperative  joint venture\n                    respectively established in accordance with Chinese laws and\n                    validly  existing,  it has observed all  applicable  Chinese\n                    laws,  and to the best of its  knowledge  it is not aware of\n                    any  pending  legal  action  or  is  subject  to  any  legal\n                    proceedings  which  might lead to the  dissolution  of Hefei\n                    Zhongli.\n\n               (2)  Hefei  Zhongli  has  obtained  all the  necessary  right and\n                    capacity to execute and perform this Contract.\n\n3.03  COMMITMENT\n\n(a) Party A hereby undertakes as follows:\n\n         (1)  Party  A  will   operate   and   maintain   the  Power  Plant  and\n         Interconnection  Facilities  in  accordance  with the  Prudent  Utility\n         Practice and without  unfavorable impact upon the Power Plant and shall\n         cause the Power Plant to be  connected  to the Power Grid,  so that the\n         Power Plant can meet the  requirements of the Technical  Specifications\n         and the Interconnection  Contract and conform to the health, safety and\n         environmental  protection standards as imposed by relevant Chinese laws\n         and regulations;\n\n         (2) Party A shall  issue  dispatch  instructions  to the Power Plant in\n         accordance with the Technical  Specifications  and the  Interconnection\n         Contract,  and shall ensure that the Power Grid will accept electricity\n         generated by the Power Plant in accordance with such instructions;  Any\n         dispatch  instructions  issued by Party A shall be in  accordance  with\n         Prudent Utility Practice,  this Contract, the Interconnection  Contract\n         and the Technical Specifications.\n\n         (3) Party A shall  purchase on the basis of the On-grid  Tariff all the\n         Annual Minimum On-Grid Quantity,  and Excess On-Grid Quantity generated\n         by the Power Plant;\n\n         (4) Party A shall do its best  efforts to assist  Party B in  obtaining\n         all necessary  governmental  approvals including without limitation the\n         approval of the Anhui  Provincial  Pricing Bureau of the On-Grid Tariff\n         (and its adjustment in accordance with the terms of this Contract).\n\n(b) Party B hereby undertakes as follows:\n\n         (1) Party B shall appoint the Anhui Mingda  Electric Power EPC Contract\n         Company  Ltd.,  the  wholly-owned  subsidiary  of  Party  A, as the EPC\n         Contractor,  so as to ensure  that the design and  construction  of the\n         Power Plant  (including the  Interconnection  Facilities) will meet the\n         requirements of the Technical  Specifications  and the  Interconnection\n         Contract and conform to the health, safety and environmental protection\n         standards as imposed by relevant Chinese laws and regulations;\n\n         (2) Party B hereby  appoints  Party A (and Party A hereby  accepts  the\n         appointment) to operate and maintain the Power Plant in accordance with\n         the  Prudent  Utility  Practice  so as not to produce  any  unfavorable\n         impact on the voltage level and frequency of the Power Grid;\n\n         (3) Party B shall,  pursuant to the provisions of this  Contract,  sell\n         the  Annual  Minimum  On-Grid  Quantity,  and Excess  On-Grid  Quantity\n         generated by the Power Plant to Party A.\n\n\n                    CHAPTER 4 CONDITIONS AND REQUIREMENTS FOR\n                       INTERCONNECTION OF THE POWER PLANT\n\n\n4.01  INTERCONNECTION OF THE POWER PLANT WITH THE POWER GRID\n\n         Party  A  shall  obtain  all  necessary   approvals   relevant  to  the\ninterconnection  of the Power  Plant with the Power  Grid.  Both  Parties  shall\nstrictly abide by the  Interconnection  Contract and ensure normal production of\nthe Power Plant and the safe operation of the Power Grid.\n\n4.02     DELIVERY POINT\n\n         The Delivery Point shall mean either the first 220KV transmission tower\nor from  the  Power  Plant.  Party A shall  own and  maintain  the  transmission\nfacilities from the Grid to the and the Delivery Point,  while Party B shall own\nand  maintain the  transmission  facilities  connecting  the Power Plant and the\nDelivery Point.\n\n4.03     TRANSMISSION AND INTERCONNECTION\n\n         Party A shall be responsible  for the design,  construction,  operation\nand maintenance of any extension to the Grid (\"the Grid Extension\")  required to\ninterconnect  the Power Plant and the Grid.  Party B entrusts the EPC Contractor\nto be responsible for designing and constructing the Interconnection Facilities,\nin accordance with the terms of the EPC Contract. Party A as the operator of the\nPower  Plant shall be  responsible  for the  operation  and  maintenance  of the\nInterconnection   Facilities.   The   constraction   fund  of   [***]   for  the\nInterconnection  Facility and the Grid  Extension has been encloded in the total\nprice of EPC Contract as stipulated in section 4.5 of the EPC Contract.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n         The  construction  and testing of the Grid  Extension  by Party A shall\nproceed  simultaneously  with the  construction  and testing of GT#1 Unit of the\nPower  Plant  and  shall  be  completed   one  month  before  the  start-up  and\nsynchronization  of the GT#1 Unit.  Party A's  obligation to purchase the Annual\nMinimum  On-Grid  Quantity and to pay  electricity fee pursuant to this Contract\nshall be calculated from the Tariff Commencement Date of the GT#1 and GT#2 Units\nirrespective  of whether or not the Grid  Extension  has been  completed by that\ndate.\n\n\n4.04     TELECOMMUNICATIONS\n\n         The communication and dispatch  automation  equipment between the Power\nPlant and the Dispatch  Center is a part of this Project.  Party A shall own the\nequipment  between the  Delivery  Point and the Dispatch  Center,  while Party B\nshall own the  equipment  between the Delivery  Point and the Power  Plant.  All\nprocurement  and  installation  of such equipment  shall be performed by the EPC\nContractor  according the EPC Contract and the total cost of the procurement and\ninstallation  of such equipment shall also be included in the total turnkey cost\nof the EPC Contract.\n\n                        CHAPTER 5 METERING OF ELECTRICITY\n\n5.01     ON-GRID METERING DEVICE\n\n         The  electrical   energy  metering  point  (the  \"Metering  Point\")  is\ninstalled at the higher voltage side of the main  transformer of each Generating\nUnit.  Time-phased active and reactive  electrical energy metering devices shall\nbe installed  at the metering  point.  In order to meet the  requirement  of the\nmetering  system of the Power Grid,  Party B's  metering  device  shall have the\nfunction of meeting the technical requirements for total load and remote gauging\ntransmission  of  the  Power  Grid  and  shall  be  equipped  with  data  memory\ntransmission and delivery device.  The above metering devices will measure Party\nB's on-grid electricity quantity in kwhs.\n\n5.02     METERING OF ELECTRICITY FROM THE POWER GRID\n\n         After the  Commercial  operation  of each  Unit of the  Power  Plant is\nsynchronized for power generation,  the high voltage auxiliary transformer shall\ninstall metering device interconnected with the Power Grid which can measure the\nquantity of  electricity  that Party B purchases from Party A. The price of such\nelectricity  shall be the average of retail  price of all power  plants  without\ninvestment or loans from contral goverment in Anhui Province.\n\n\n5.03     MANAGEMENT OF METERING DEVICES\n\n         Party B  entrusts  the  EPC  Contractor  and  Party  A  operator  to be\nresponsible for purchasing,  installing, replacing and managing the various sets\nof metering devices of the  above-mentioned  metering points. The calibration of\nthe  metering  devices  shall  be  done by  qualified  state-approved  firms  in\naccordance with stipulations and jointly participated in by both Parties.\n\n5.04     FAULT PROCESSING OF METERING DEVICES\n\n         In case of any anomaly or fault in metering  devices  during  operation\nwhich may affect the functioning of electrical energy metering devices,  Party A\nshall notify Party B on time and make  arrangements to restore normal  metering.\nThe method of metering and the On-Grid  Quantity during abnormal period shall be\ndetermined in accordance with the procedures stipulated in Appendix 5 hereof.\n\n                     CHAPTER 6 OPERATION OF THE POWER PLANT\n\n6.01     ENGAGEMENT OF OPERATION\n\n         Party B  hereby  engages  Party A as  operator  of the  Power  Plant to\nmanage,  operate and maintain the Power Plant and to provide Operation  Services\nand Pre-Operation Services as stipulated in this Contract as well as a supply of\nfuel oil that satisfies the Fuel Specification.  The term of engagement shall be\nthe same as the term of this Contract.\n\n6.02     BASIC REQUIREMENTS\n\n         1)  Party  A  shall  perform  of the  Pre-Operation  Services  and  the\nOperation  Services  in  compliance  with the any laws  and  regulations  of the\nPeople's Republic of China and the provisions this Contract and the requirements\nof the  Interconnection  Contract  and the  Dispatch  Agreement  relevant to the\noperation and maintenance of the Power Plant. Party A will, on demand, indemnify\nParty B on and from any costs, losses or  expenses(including  fines) incurred or\nimposed as a consequence of any breach of this  paragraph,  and pay directly the\nrelated  expenses  and  penalties  under the  Interconnection  Contract  and the\nDispatch Agreement to the dispatcher of the Power Grid.\n\n         2) Party A shall operate the Power Plant in accordance with the Prudent\nUtility  Practice and shall perform the  Operation  Services on the basis of the\ngoal of achieving the After-tax Capital Return.\n\n         3)  Party A shall  ensure  that  the  Power  Plant  is  maintained  and\noverhauled  on a regular and proper  basis and that the Power Plant can generate\nthe  greater  of (i) the Annual  Minimum  On-Grid  Quantity  and (ii) the annual\nactual  demand of the Power  Grid,  every Year during the  Commercial  Operation\nPeriod.\n\n         4) Party A shall operate the Power Plant in accordance  with  Technical\nSpecifications,  operation  regulations of the Ministry of Electric Power and in\ncompliance with the recommendation of the equipment manufactures,  and shall try\nin every  possible way to generate as much  electricity  as possible on a stable\nbasis and within the allowable limits of the Power Grid.\n\n6.03     PRE-OPERATION SERVICES\n\n         Party A shall perform the Pre-Operation Services and the other services\nlisted below from the date of execution of this  Contract  until the  Commercial\nOperation Date of the Power Plant.\n\n         1)  Party A shall be  responsible  for  doing a good job of  production\nreadiness  before the Commercial  Operation Date of the Power Plant and to carry\nout on-post training for production personnel.\n\n         2) provide all the  necessary  personnel and material for Party B so as\nto  enable  Party B and the EPC  Contractor  to  perform  their  obligations  in\nconnection with the construction and Commissioning of the Power Plant.\n\n         3) provide  relevant  advises and support to Party B in connection with\nthe  construction  of the Power Plant and the  Commissioning  of the  Generating\nUnits and participate in the  Commissioning  of the Generating Units pursuant to\nrequests put forward by Party B from time to time.\n\n         4) perform the Pre-Operation Services specified in Appendix 6 hereof.\n\n6.04   OPERATION SERVICES\n\n         On and from the Commercial  Operation  Date,  Party A shall provide the\nfollowing services:\n\n         1) To perform all its duties and  obligations  in  connection  with the\noperation and  maintenance  of the Power Plant in  accordance  with the terms of\nthis Contract.\n\n         2) To provide  relevant  advises and  support to Party B in  connection\nwith the operation and  maintenance  of the Power Plant and pursuant to requests\nput forward by Party B from time to time.\n\n         3) To provide the Operation Services specified in Appendix 6 hereof.\n\n6.05     FUEL OIL SUPPLY\n\n         During the Commercial  Operation  Period,  Party A shall be responsible\nfor  supplying  to the Power Plant on a long term basis fuel oil that  satisfies\nthe Fuel  Specification so as to ensure that the Power Plant has sufficient fuel\noil to generate the Annual  Minimum  On-Grid  Quantity  stipulated  in Article 9\nhereof and the Excess On-Grid  Quantity that matches the annual actual demand of\nthe Power Grid at any time in the Commercial  Operation  Period.  Subject to the\nagreement  from Party B, Party A shall  enter into the Fuel Oil Supply  Contract\nfor the long term  supply of fuel oil to the Power  Plant.  For  details see the\nFuel Oil Supply Contract in Appendix 9.\n\n         It shall be deemed the  responsibility of Party A, if the fuel oil does\nnot satisfy the Fuel Specification or is in short supply,  thus resulting in the\nfailure of the Power Plant to generate the Annual Minimum  On-Grid  Quantity and\nthe Excess  On-Grid  Quantity that matches the annual actual demand of the Power\nGrid at any time in the Commercial Operation Period.\n\n6.06     GENERATION PLAN AND COST BUDGET\n\n         Party A shall be responsible for formulating the Annual Generation Plan\nand assisting  Party B in calculating  the Planned  Generation Cost of the Power\nPlant in November of each Year for the  following  Year.  The Annual  Generation\nPlan shall guarantee the generation of the Annual Minimum On-Grid Quantity.  The\nPlanned  Generation  Cost shall take into  account  the  expected  or  potential\nincrease in the generation  costs  incurred in the succeeding  Year. The Planned\nGeneration Cost shall become the Approved Generation Cost of the succeeding Year\nupon approval of the Anhui Provincial Pricing Bureau and the approved Generation\nlost shall be deducted  from the  Electricity  Fee in  accordance  with  Section\n10.03, Section 10.04 and Appendix 1 of this Contract.\n\n         If on or after the end of a given  Year the  actual  cost to Party A of\ngenerating the Annual Minimum On-Grid  Quantity is recognized by both Parties as\nexceeding the Approved Generation Cost for the Year, the excess portion shall be\npaid by Party A. Such excess plus the actual  interest  cost incurred by Party A\nin funding such excess (\"Total Excess Amount\") shall be included in the proposed\nOn-grid Tariff of the succeeding Year. Upon approval by Anhui Provincial Pricing\nBureau,  such Total Excess Amount shall become a part of the Approved Generation\nCost of the  succeeding  Year and be deducted from the monthly  Electricity  Fee\naccording to Section 10.03, Section 10.04, and Appendix 1 of this Contract.\n\n         If the  On-grid  Tariff  for the  succeeding  Year is  lower  than  the\nproposed  On-grid Tariff  submitted for approval and the On-grid Tariff does not\ninclude  the full  amount of the Total  Excess  Amount  referred  to in previous\nparagraph,  then the Total Excess  Amount shall be divided in to two parts:  (a)\nthe part not due to the changes in inflation and foreign exchange shall be borne\nby the Party A and (b) the part due to the  changes  in  inflation  and  foreign\nexchange(if  any)  shall  be borne  by  Party B and  repaid  to Party A in equal\nMonthly  installments at the end of each Month from the \"Annual Adjustment Fees\"\nlisted in Appendix 4.\n\n         If the actual cost to Party A of generating the Annual Minimum  On-Grid\nQuantity is lower than the  Approved  Generation  Cost in any Year,  taking into\naccount the efforts  which Party A has made in the  management  and operation of\nthe Power Plant,  Party B will  (provided  the Planned  Generation  Cost for the\nfollowing is not reduced by the Anhui Provincial Pricing Bureau) reward [***] of\nthe difference  between the Approved  Generation Cost and actual cost to Party A\nof generating the Annual Minimum On-Grid Quantity.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n6.07     INFORMATION\n\n         At the request of Party B, Party A shall periodically  furnish to Party\nB information  monthly in connection  with the operation and  maintenance of the\nPower Plant and its performance of the Pre-Operation  Services and the Operation\nServices.  Party A shall also, pursuant to Appendix 6 hereof, furnish to Party B\na monthly  statement  which  includes a  financial  statement  and a  production\nstatement  (For  details,  see  Appendix  6  hereof).  At any  time  during  the\nCommercial  Operation Period, Party B has the right of access to all records and\ninformation of the Power Plant.\n\n\n6.08     STAFF\n\n         Party A shall,  after  consultations with Party B, appoint a qualified,\ncompetent  and  experienced  person as the  manager  of the  Power  Plant who is\nconcurrently  the deputy general  manager for operation of Party B and who shall\nnot be  replaced  without  prior  consultation  with  Party  B. If such  manager\nresigns,  or is  dismissed,  or fails to perform  his (or her)  duties for other\ncauses, Party A shall consult with Party B as soon as possible,  so that another\nqualified,  competent and experienced person to fill this vacancy can be quickly\nappointed.\n\n6.09     SUBCONTRACTING\n\n         1) Party A shall not delegate or subcontract  the entire  Pre-Operation\nor Operation Services to a third party or parties.\n\n         2)  Subject  to  Section  6.09 1)  hereof,  Party A may with the  prior\nwritten consent of Party B,  subcontract if necessary part of the  Pre-Operation\nServices  or  Operation  Services to experts or other  subcontractors,  so as to\nensure that Party A can perform its  responsibilities.  Such  subcontracting can\nnot relieve  Party A from any of its  duties,  responsibilities  or  obligations\nunder this  Contract.  Party A shall be fully  responsible  for the  actions and\ndefaults  of its  subcontractors  just as they are  Party  A's own  actions  and\ndefaults.\n\n6.10     STRICTNESS OF RESPONSIBILITY\n\n         The  responsibility  and  liability  of Party A under this  Contract is\nstrict.  Party  A  shall  not be  relieved  of any  of its  responsibilities  or\nliabilities   under  this  Contract  because  of  Party  B's   performance,   or\nnon-performance,  or delayed performance of its obligations under this Contract,\nor because of Party B's act or default.\n\n                CHAPTER 7 RESPONSIBILITIES OF PARTY B AND PARTY A\n\n7.01     RESPONSIBILITIES OF PARTY B\n\n1) INITIAL WORKING CAPITAL\n\n         Prior to the Commercial Operation Date of the GT#1 Unit, Liyuan-AES and\nHefei  Zhongli shall provide  Party A an initial  working  capital  amounting to\n[***].\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n2) PAYMENTS FOR PRE-OPERATION SERVICES\n\n         To enable  Party A to perform the  Pre-Operation  Services  pursuant to\nSection 6.03 hereof and in view of the fact that the EPC Contractor is Party A's\nwholly-owned  subsidiary,  Party A hereby acknowledges and agrees that the total\nprice of the EPC  Contract,  as  stipulated  in Section 4.1 of the EPC Contract,\npayable to the EPC Contractor shall be deemed to include an amount in respect of\nthe Pre-Operation  Services and no additional amount shall be payable to Party A\nunder this Contract in respect of the Pre-Operational Services.\n\n3) PAYMENTS FOR OPERATION SERVICE\n\n         To enable Party A to perform the Operation  Services as the operator of\nthe Power Plant,  Party B shall pay Party A a monthly  operation and  management\nfee.  The  operation  and  management  fee  shall  be  included  in the  Planned\nGeneration  Cost of the succeeding  Year. The operation and management fee shall\nonly be  payable  to  Party  A to the  extent  it is  included  in the  Approved\nGeneration Cost as part of the On-grid Tariff for the succeeding Year.\n\n4)  BONUS FEES\n\n         Within 30 days after the end of each Year, Party A shall inform Party B\nin  written  form the due  amount  of bonus  payable  for the  previous  Year in\naccordance  with this  Contract  (\"Bonus  Notice\").  The  amount of bonus  shall\ninclude the bonus for  costsaving (as provided for in clause 6.06) and the bonus\nfor Excess On-Grid  Quantity(as  provided for in clause 9.03). Within 14 days of\nreceiving  the Bonus  Notice and the last  Electricity  Fee Payment of the year,\nParty A and Party B shall settle the bonus payment.\n\n7.02  RESPONSIBILITY OF PARTY A\n\n          Party A shall ensure that the Power Plant generates the Annual Minimum\nOn-Grid  Quantity and shall  purchase  the Annual  Minimum  On-Grid  Quantity in\naccordance with the principle of \"Take or Pay\", and shall pay  electricity  fees\non time.  Starting from the Commercial  Operation Date, Party A shall in its own\nname  arrange  and  obtain  necessary  and  supplementary  working  capital  for\nproduction  according to needs and the accrued interest expenses therefrom shall\nbe included in the Planned  Generation  Cost  submitted to the Anhui  Provincial\nPricing Bureau for approval. Party A's obligation to make payment for the Annual\nMinimum On-Grid Quantity in accordance with the principle of \"Take or Pay\" shall\nnot be affected by any  circumstance,  other than Force Majeure or the Party B's\ndefault stipulated in Section 12.02 hereof, including without limitation:\n\n\n(i)  any delay in the  construction or  commissioning  of the Power Plant or any\n     Unit of the Power Plant including the Interconnection Facilities;\n\n(ii) any delay in the construction or commissioning of the Grid Extension;\n\n(iii)the  inability  of the Power  Plant to deliver the Annual  Minimum  On-Grid\n     Quantity for any reason including without limitation:\n\n     (a)  any failure or  inability  of Party A to obtain  fuel,  spare parts or\n          replacement  parts,  services or other  matters or things;\n     (b)  any act or default of any employee, agent or officer of Party A,\n     (c)  the inability of the Interconnection Facilities, the Grid Extension or\n          the Power Grid to receive or transmit electricity; or\n     (d)  any outages at the Power Plant, whether scheduled or forced outages.\n\n                        CHAPTER 8 OTHER OPERATION MATTERS\n\n8.01  OPERATION PLAN\n\n         Prior to the end of November  each Year,  Party A shall  formulate  the\nAnnual  Generation Plan for the following Year which  determines the anticipated\nterm of outage  because of major and minor  overhaul as well as the  anticipated\naverage load curve of power generation.\n\n8.02  EMERGENCY PLAN\n\n         Party A shall hold  regular  meetings  with Party B in respect of power\ndemands  and  offtake  obligations,  so that , subject to the above  provisions,\nParty  A can  amend  the  relevant  operation  schedule  if  necessary,  but the\namendment of the operation schedule shall not affect the liability of Party A to\npurchase the Annual Minimum On-Grid Quantity in accordance with the principle of\n\"Take or Pay\".\n\n8.03  RECORDS\n\n         The Parties  shall keep  complete  and  detailed  records and all other\ninformation which they need, so as to carry out properly this Contract.\n\n         The  above-mentioned  records shall be kept for at least 60 Months from\nthe  date of  formation,  or for a longer  period  required  by the  supervisory\nauthorities  having  jurisdiction  over the  Parties,  but the  Parties  are not\nallowed to deal with or destroy any of the above  records upon  expiration of 60\nmonths  without 30 days'  prior  written  notice to the other  Party.  Under the\ncircumstances of giving reasonable notice to any other Party at a proper time in\nadvance,  any Party has the right to review in any business  hours the operation\nand dispatch  records and  information in connection with this Contract or Power\nGrid which the other  Party has kept  within the term of keeping all the records\nand information pursuant to this Article.\n\n\n                           CHAPTER 9 ON-GRID QUANTITY\n\n9.01  ANNUAL MINIMUM ON-GRID QUANTITY\n\n         Party  A,  as the  operator  and  offtaker  of the  Power  Plant  shall\nguarantee the Power Plant to generate the Annual Minimum On-Grid Quantity:\n\n         (1) GT#1 Unit and GT#2 Unit: From the Tariff  Commencement  Date of the\nGT#1  and GT#2  Unit to the end of the  same  Year  (Dec.  31)  when the  Tariff\nCommencement Date of the ST Unit starts,  the Annual Minimum On-Grid Quantity of\ntwo Units  shall be [***] KWH  calculated  pro rata if it less than a Year ( 365\ndays); plus\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n         (2) ST Unit:  From the Tariff  Commencement  Date of the ST Unit to the\nend of that Year (Dec.  31),  the Annual  Minimum  On-Grid  Quantity of the Unit\nshall be [***] KWH calculated pro rata if it reaches a Year (365 days); or\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n         (3) From the first Year following the Tariff  Commencement  Date of the\nST Unit to the expiration of the term of the Joint Venture Contract,  the Annual\nMinimum On-Grid Quantity of the Power Plant each Year shall be [***] KWH.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n9.02   EXCESS ON-GRID QUANTITY\n\n         In order to  maximize  Party B's profits  and to  encourage  Party A to\npurchase as much electricity as is generated,  Party A shall purchase the Excess\nOn-Grid  Quantity at the On-grid Tariff,  the net profits from this income after\ndeducting  the Variable  Cost and taxes payable by Party B will first be used to\nmake up any shortfalls in Party B's After-tax  Capital Return in accordance with\nAppendix 2 for the  current  Year,  and then the  remaining  amount  (\"Remaining\nAmount\") distributed in accordance with the following principles:\n\n          (1)  If the Annual Actual On-Grid  Quantity exceeds the Annual Minimum\n               On-Grid  Quantity by [***],  then [***] of the  Remaining  Amount\n               shall be paid to Party A;\n\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n          (2)  If the Annual Actual On-Grid  Quantity exceeds the Annual Minimum\n               On-Grid Quantity by more than [***],  then [***] of the Remaining\n               Amount from any output in excess of [***] over the Annual Minimum\n               On-Grid Quantity shall be paid to Party A;\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n          (3)  The remaining portion shall be distributed to Party B.\n\n 9.03 VARIABLE COST\n\n         Party A shall also receive as operator  the Variable  Cost for each KWH\nof Excess On-Grid Quantity but shall not be entitled to the Approved  Generation\nCost.\n\n\n           CHAPTER 10 ON-GRID TARIFF AND SETTLEMENT OF ELECTRICITY FEE\n\n10.1     ON-GRID TARIFF\n\n         Party A and Party B have, through full negotiations,  reached unanimity\nin respect of the On-grid Tariff on the following principles:\n\n          1)   The composition of the On-grid Tariff\n\n               The  composition  of the On-grid  Tariff shall be calculated  and\n               adjusted in accordance with Appendix 4 hereof.\n\n          2)   The principles  for  submitting  the proposed  On-grid Tariff for\n               approval\n\n               a)   Theannual  On-Grid  Quantity of the Power Plant shall be the\n                    Agreed Annual  kilowatt-hours as defined in Appendix 4 which\n                    also is the same as Annual Minimum On-Grid Quantity of [***]\n                    kwh as  specified  in section 9.01 such number is set at the\n                    time of signing this Contract based on [***] in the On- Grid\n                    Tariff   Formula  of  Article  2  of   Appendix  4  and  the\n                    characteristics of gas turbine PG6551B;\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n               b)   It  is  based  on  the  amount  of  principal  and  interest\n                    repayment as stipulated in the US$ Loan Contracts,  the term\n                    for  repayment  and  the  amount  of  anticipated  After-tax\n                    Capital  Return (as  provided for in Appendix 2) and Planned\n                    Generation  Cost during the term of the joint  venture based\n                    on  the  number  of  utilization  hours  as  listed  in  the\n                    preceding section;\n\n               c)   To set up the Annual  adjustment  fees which will be used to\n                    compensate  for the increase in costs or any adverse  effect\n                    on  amounts  payable  under  the US$ Loan  Contracts  or the\n                    After-tax  Capital  Return  resulting  from  changes in such\n                    factors as fuel costs,  exchange rates, and taxation and any\n                    other factors;\n\n               d)   The  performance  parameter of a  Generating  Unit which was\n                    determined before it was put into commercial operation shall\n                    be one of the bases for calculation;\n\n               e)   The total  revenue of the Power Plant in each Year under the\n                    above-mentioned  conditions  shall be  sufficient to pay all\n                    the costs  expenses  After-tax  Capital Return and the other\n                    items,  composing the On-grid Tariff as detailed in Appendix\n                    4.\n\n\n          3)   Adjustment of On-grid Tariff\n\n\n               By the  end  of  November  of  each  Year  after  the  Commercial\n               Operation Date of the Power Plant,  Party B shall,  in compliance\n               with the  On-grid  Tariff  Formula  in  Appendix 4 hereof and the\n               adjustment  mechanism provided for in Appendix 4, and taking into\n               consideration  all the factors  stipulated in Section 10.1 (1)and\n               (2),  calculate the tariff and then submit the on-grid tariff for\n               the following Year after full  consultation with Party A in order\n               to compensate  any increase in cost resulting from the changes in\n               fuel, exchange rate, taxation and other factors.\n\n\n          4)   Approval and Implementation of the On-grid Tariff\n\n\n               Party B shall be responsible  for calculating the proposed tariff\n               and for submitting it to the Anhui Provincial  Pricing Bureau for\n               approval  after  full  consultation  with  Party A. The  approved\n               On-grid  Tariff  shall be the  settlement  price for the  On-Grid\n               Quantity and shall be strictly implemented by both Parties.\n\n               If the approved  On-grid Tariff is lower than the proposed tariff\n               submitted  for  approval,  Party A shall use its best  efforts to\n               generate and purchase more On-Grid Quantity,  so as to offset the\n               unfavorable  impact on Party B resulting  from the On-grid Tariff\n               being less than the proposed tariff submitted for approval.\n\n10.02  ELECTRICITY FEE\n\n          1)   On-Grid Quantity Before the Tariff Commencement Date\n\n         In  accordance  with the  provision  of  Section  5.2.5  under  the EPC\nContract and subject to the provision of Section 7.01 2) hereof,  the revenue on\nall the  generated  by each  Generating  Unit  before its  corresponding  Tariff\nCommencement  Date shall belong to the EPC Contractor while all cost,  including\nfuel cost and generation  cost,  associated  with such revenue shall be borne by\nthe EPC Contractor.\n\n          2)   Failure to Accept Annual Minimum On-Grid Quantity\n\n         Starting  from the  Commercial  Operation  Date of the Power Plant,  if\nParty A fails to accept the Annual  Minimum  On-Grid  Quantity,  in  addition to\npaying the electricity  fees for the Actual On-Grid  Quantity in accordance with\nthe On-grid Tariff, Party A shall also pay a compensation fee for the difference\nbetween the Annual Minimum  On-Grid  Quantity and the Actual  On-Grid  Quantity.\nSuch compensation fee shall be calculated as follows:\n\n                                      [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n          3)   Annual Minimum On-Grid Quantity and Excess On-Grid Quantity\n\n         Party A shall purchase all the Annual Minimum On-Grid  Quantity and the\nExcess  On-Grid  Quantity  generated by the Power Plant in  accordance  with the\nOn-grid Tariff.\n\n10.03    METHOD OF SETTLEMENT\n\n          1)   Party B shall make a  calculation  of the On-grid  Tariff and the\n               Planned  Generation  Cost.  This Planned  Generation Cost will be\n               part of the tariff  calculation  prior to the end of  November of\n               each Year and submit it to the Anhui  Provincial  Pricing  Bureau\n               for approval  after full  consultation  with Party A. The Planned\n               Generation  Cost shall  include  the  Variable  Cost,  salary and\n               welfare overhaul expense and other costs of Party A as stipulated\n               in Appendix 4 hereof.  In settling  the  electricity  fees,  both\n               Parties must strictly implement the Approved  Generation Cost and\n               the On-grid Tariff.\n\n          2)   Party A is both the operator and the offtaker of the Power Plant.\n               In respect of Party B, it is the Party A's strict  responsibility\n               to ensure the generation of Annual Minimum  On-Grid  Quantity and\n               the  purchase of Annual  Minimum  On-Grid  Quantity.  In order to\n               accelerate  the turnover of funds,  both  Parties  agree that the\n               electricity  fees which Party A pays to Party B and the  Approved\n               Generation  Cost which Party B pays to Party A in respect of each\n               KWH of generation up to the level of the Annual  Minimum  On-Grid\n               Quantity shall adopt the method of offsetting and deduction. Only\n               Approved  Generation  Cost  shall be  deducted  from each  amount\n               payable by Party A pursuant to this  Contract,  together with the\n               provision of a tax payment  receipt to Party B in connection with\n               the VAT and  other  Tax (as in  Appendix  4 )  relevant  to power\n               generation  which is  withheld by Party A, (the above tax payment\n               receipt shall be the amount to be paid in full in accordance with\n               the state  regulation on electric  power VAT and in which the VAT\n               for purchase is not withheld.) the balance after  deduction shall\n               be remitted to the bank account designated by Party B in the form\n               of a written notice to Party B.\n\n          3)   Party  A  shall  open  a  special-purpose  account  for  settling\n               electricity  fees in the Anhui  Branch of the Bank of China,  and\n               will settle accounts with  Liyuan-AES and Hefei Zhongli,  Party A\n               shall   guarantee   that  there  is   sufficient   funds  in  the\n               special-purpose  account for settling  electricity  fees so as to\n               pay  all  the  accounts  due  and  payable  under  this  Contract\n               (including  without limitation this Section 10.03 , Section 10.04\n               and  Section   12.05).   Liyuan-AES   and  Hefei   Zhongli  shall\n               respectively  open  accounts  in the Anhui  Branch of the Bank of\n               China     whose     account     numbers     are      respectively\n               Liyuan-AES:---------,  and Hefei Zhongli: --------; Party A shall\n               execute a relevant agreement with the Anhui Branch of the Bank of\n               China to cause  the  latter  to  transfer  each  [***] of all the\n               amounts  respectively  to the  above two bank  accounts  from the\n               special-purpose account for settlement which Party A shall pay in\n               accordance with the stipulations of this Contract.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n          4)   Party A shall pay  electricity  fees to Party B prior to the 14th\n               of each month which is equivalent to [***] of the electricity fee\n               of the preceding  month actual on-grid  quantity,  and shall have\n               settled the electricity  fees for the Minimum On-Grid Quantity of\n               the  Preceding  Quarter  prior to the 14th of the first  month of\n               each Quarter which shall be calculated as [***];  The electricity\n               fees for the first half of the year and the preceding  year shall\n               be settled prior to July 14 and January 14 each Year on the basis\n               of the greater of the following On-Grid Quantity:\n\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n               (a)  the minimum On-Grid Quantity calculated pro rata time,\n\n               (b)  Actual On-Grid Quantity.\n\n          5)   If Party B is requested to pay value added  tax(VAT) or other Tax\n               (as in Appendix 4) in respect of any sums  received  from Party A\n               under this  Contract,  the amount of such  business  tax shall be\n               Other Tax (as in  Appendix  4)shall be  reimbursed  to Party B by\n               Party A for Party B on demand.\n\n10.04   INVOICES AND PAYMENT\n\n          1)   The  representatives  appointed  by  Party  A and  Party  B shall\n               jointly make meter readings on the first working day every month.\n               Party B shall deliver the invoice prior to the 7th of each month,\n               and  Party A shall  pay the  amount  of  money  specified  in the\n               invoice  within the term  stipulated  in Section  10.03(c)  after\n               having  received the invoice,  interest shall be accrued for late\n               payment, and Party A shall pay to Party B late payment penalty on\n               the basis of [***] per day on an accumulative basis from the date\n               due and  payable to the  actual  payment  date. \n\n         Party A's excess payment or under payment as shown in any invoice shall\nbe deducted or increased from the payable amount due in the next invoice.\n\n         This Section is also  applicable  to any payments to be Paid under this\nContract by Party B to Party A.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n          2)   Invoice in dispute:  Should there be any dispute over the invoice\n               amount,  Party A shall still pay the full invoice amount to Party\n               B.  Upon  resolution  of  the  dispute,  if any  amount  is to be\n               refunded to Party A it shall  include  together with the interest\n               on the basis of [***] per day on an  accumulative  basis shall be\n               returned  to Party A. Such  interest  shall  accrue from the date\n               when Party A starts to pay  according  to the  invoice  until the\n               date when the required amount has been returned to Party A.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n          3)   Party A's payment  obligations  under this Contract are absolute,\n               unconditional and independent of any other  transactions  between\n               both Parties.\n\n                     CHAPTER 11 RESPONSIBILITY AND INDEMNITY\n\n11.01 Party A shall bear  responsibility for and shall have no recourse to Party\nB  and\/or  its  Contractor  for the  project-related  property  loss  or  damage\nincluding  damage to,  premature,  deterioration  of or loss of the Power Plant,\npersonal  injury  and  all  expenses  arising  therefrom  or  relating  thereto,\nincluding  but not  limited to  reasonable  legal fees which must be suffered by\nParty B and \/or its Contractor arising out of Party A's negligence breach of the\nContract or other act or default. Party A also agrees to fully indemnify Party B\nand\/or its  Contractor in respect of the  above-mentioned  conditions,  but such\nindemnity  shall not be extended to any loss,  damage,  injury (or any  relevant\nclaim)  or  relevant  fees or  expenses  arising  out of Party  B's  and\/or  its\nContractor's  action or  inaction  or  failure  to take  measures  to reduce the\nconsequences.\n\n11.02 Party B shall bear  responsibility for and shall have no recourse to Party\nA  and\/or  its  Contractor  for the  project-related  property  loss or  damage,\npersonal  injury  and  all  expenses  arising  therefrom  or  relating  thereto,\nincluding  but not  limited to  reasonable  legal fees which must be suffered by\nParty A and\/or its  Contractor  arising out of Party B's  negligence or improper\naction.  Party B also agrees to fully indemnify Party A and\/or its Contractor in\nrespect  of the  above-mentioned  conditions,  but such  indemnity  shall not be\nextended to any loss, damage, injury (or any relevant claim) or relevant fees or\nexpenses arising out of Party A's and\/or its Contractor's  action or inaction or\nfailure to take measures to reduce the consequences.\n\n11.03 If any third party  institutes  a claim or legal  proceedings  against the\nindemnified Party in respect of indemnity  matters  stipulated in this Contract,\nthe  indemnified  Party is  entitled  ( but is not  obliged ) to  respond to the\nclaim,  to defend  the claim or to  institute  legal  action  and may  decide to\nappoint an attorney to represent it in respect of any claims, defense or action,\nand the relevant  reasonable fees and expenses  thereto shall be included in the\nindemnity responsibility borne by the indemnifier pursuant to this Contract.\n\n         But if the indemnifier  recognizes in written form to have  indemnified\nthe  indemnified in respect of all the losses  pursuant to what is stipulated in\nSections 11.01 and 11.02,  the indemnifier,  after having promptly  notified the\nindemnified  in advance and paid the  indemnified  for the  reasonable  fees and\nexpenses,  is  entitled  to  counterplead  in  respect  of the  claim  or  legal\nproceedings,  and to appoint an attorney by itself with all the relevant fees at\nits own expense.\n\n         Without the prior consent of the other Party in written form, any Party\nshall  not  settle or  compromise  presumptuously  by itself  any claim or legal\nproceedings  from which it is entitled to obtain indemnity from the other Party,\nbut the other  Party  shall not refuse to agree for no reason;  unless the other\nParty  refuses to agree for no reason,  if one Party is  originally  entitled to\nobtaining  indemnity from the other Party, but it  presumptuously  resolves such\nclaim or legal proceedings or makes a compromise  thereto without the consent of\nthe other Party in written form,  then the other Party can relieve any indemnity\nobligation which it bears to the Party which makes the settlement or compromise.\n\n         The indemnity as stipulated in Sections  11.01 and 11.02 shall under no\ncircumstances  be extended to indirect  loss or damage,  and neither Party shall\nbear any  responsibility  in relation to indirect loss or damage  arising out of\nits performance of obligations or exercise of rights pursuant to this Contract.\n\n                       CHAPTER 12 DEFAULT AND TERMINATION\n\n12.01    TERM OF EFFECTIVENESS\n\n         This Contract  shall come into effect on the date as defined in Section\n18.01  hereof,  and the  purchase  of  electricity  shall  start from the Tariff\nCommencement  Date of the GT#1 and GT#2 Units until the termination of the Joint\nVenture  Contract  unless  otherwise  sooner  terminated in accordance with this\nContract.\n\n12.02    DEFAULT\n\n          1)   Unless the  default of Party B is due to Party A's  default,  the\n               following events shall be considered as the default of Party B:\n\n               a)   Liyuan-AES or Hefei  Zhongli  Energy goes bankrupt or become\n                    insolvent  and such  condition has remained  unremedied  for\n                    ninety (90) days;\n\n               b)   Party B has abandoned this project for six (6) months.\n\n          2)   The  following  event shall be considered as the default of Party\n               A:\n\n               a)   Party A fails to make payment  pursuant to this Contract and\n                    such case has remained unremedied for forty five (45) days;\n\n               b)   Party A breaches  any other  obligation  stipulated  in this\n                    Contract and such case has remains unremedied for forty five\n                    (45) days;\n\n               c)   Party A as the operator of the Power Plant fails to generate\n                    electricity  for twenty (20) days (except for planned  major\n                    and minor overhaul and Force Majeure);\n\n               d)   Party A,  pursuant to laws,  is  dissolved  or  reorganized,\n                    provided  that  Party A  shall  not be  considered  to be in\n                    default if the reorganization does not affect the ability of\n                    the  reorganized  entity to  perform  Party A's  obligations\n                    under  this  Contract  and  the   re-organized   entity  has\n                    undertaken  unconditionally the obligations of Party A under\n                    this Contract (the past or the future) .\n\n12.03    TERMINATION IN ADVANCE\n\n          1)   If any event  described in Section  12.02  occurs,  any Party may\n               terminate  this Contract in advance and do so in accordance  with\n               the following termination procedures:\n\n          a)   The Party which exercises the right of terminating  this Contract\n               shall notify the  defaulting  party of its intention to terminate\n               this  Contract  and shall  describe in details the  condition  of\n               default;\n\n          b)   After the defaulting  party has received the termination  notice,\n               it shall  remedy or mitigate  the  condition of within forty five\n               (45) days or  fifteen  days (15) (in the case of  failure to make\n               payment  pursuant  to this  Contract.  If such  condition  is not\n               remedied within the stipulated  period, the Party which exercises\n               the  right of  terminating  this  Contract  may  issue  the final\n               notification of termination to the defaulting Party.\n\n          2)   Party B may  terminate  this  Contract in advance if the Central,\n               Provincial or local government of the People's  Republic of China\n               requisitions,  levies by coercion,  or nationalizes the assets or\n               rights and interests of Party B or the Investors.\n\n          3)   Party B may  terminate  this  Contract  in advance if the On-grid\n               Tariff proposed by Party B to Anhui Provincial  Pricing Bureau is\n               not  approved  at the  level  first  proposed  by Party B for two\n               consecutive Years.\n\n12.04    NORMAL TERMINATION\n\n         If this Contract  terminates upon its  expiration,  Party A shall repay\nthe initial working capital amounting to [***] to Party B.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n12.05    TERMINATION FEES\n\n         If this  Contract is terminated by Party B because of Party A's default\nor pursuant to Section  12.03  hereof,  Party A shall  forthwith  pay to Party B\ntermination  fees  calculated in accordance  with  Appendix 3 :  Calculation  of\nTermination  Fees.  After Party A has paid the  termination  fees, all Party B's\nassets and rights and interest shall be transferred to Party A.\n\n                            CHAPTER 13 FORCE MAJEURE\n\n13.01    DEFINITION OF FORCE MAJEURE\n\n         \"Force Majeure\" shall mean any of the following events:\n\n         1) war, hostility or insurrection;\n\n         2) plague or other epidemics;\n\n         3) fire not caused by negligence or deliberate arson;\n\n         4) lightning;\n\n         5) earthquake;\n\n         6) other natural forces including natural calamities.\n\n         Provided  that no event  shall be  regarded  as a Force  Majeure  event\nunless it simultaneously bears the following six features:\n\n         1) arising after the execution of this Contract;\n\n         2) unforeseen or unavoidable;\n\n         3) beyond the control of a relevant party;\n\n         4) occurring within the Power Plant Site;\n\n         5) directly  hampering  the  performance  of this Contract by one\n            Party; and\n\n         6) unpreventable  in spite of all the  best  efforts  made by the\n            relevant Party.\n\n13.02    NOTIFICATION OF FORCE MAJEURE\n\n          1)   The Party  claiming  Force  Majeure (the \"Force  Majeure  Party\")\n               shall promptly notify the other Party of any Force Majeure event,\n               no later than five working days after the following date:\n\n               a)   The  commencement  date of a Force Majeure event that causes\n                    loss or damage to the Power Plant; or\n\n               b)   The date that in the  event of a Force  Majeure  event  that\n                    does not cause loss or damage to the Power Plant, such Party\n                    knows or ought  reasonably to know of the  occurrence of the\n                    Force Majeure event.\n\n         Notwithstanding  the above,  if the Force  Majeure event results in the\nsuspension of  communication  so that the Force Majeure Party is unable to issue\nthe notice within the above-stipulated time limit, the Force Majeure Party shall\npromptly issue notice as soon as the  communication is restored but shall not be\nlater than one working day after the communication is restored to normal.\n\n         The Force Majeure Party shall within 15 days provide the details of the\nForce Majeure event and the certificate issued by the local notary  organization\nor equivalent  organization which will account for the reasons why a part or all\nof the  obligations  of  this  Contract  cannot  be  performed  out or  must  be\npostponed.\n\n          2)   The Force Majeure Party must notify the other Party in respect of\n               the following:\n\n\n               a)   The cessation of the Force Majeure event; and\n\n               b)   The  cessation of the impact of the Force Majeure event upon\n                    the enjoyment of rights or  performance  of  obligations  of\n                    such Party under this Contract.\n\n         The  above  notice  shall  be  issued  promptly  after  the  conditions\nmentioned in a) and b) above are known to such Party.  With the exception of the\nsuspension of  communication  as  stipulated in the second  paragraph of Section\n13.02 (1), the notice must under any of the  above-mentioned  circumstances,  be\nissued within two working days after having known the relevant conditions.\n\n     3)   If notice of the Force  Majeure event is not issued to the other Party\n          in strict compliance with the provisions of Section 13.02(1),  a Party\n          shall not be entitled to claim relief from the Force Majeure event and\n          shall be relieved from performing to obligations under this Contract.\n\n13.03    MITIGATION OF CONSEQUENCES\n\n         The Party  affected  by the Force  Majeure  event  shall  mitigate  the\nconsequences  of the Force Majeure event upon its enjoyment of its rights or the\nperformance of its obligations under this Contract.\n\n13.04    DELAY CAUSED BY FORCE MAJEURE EVENT\n\n         Subject to Sections  13.02(3) and Section  13.03,  if one or more Force\nMajeure events or their consequences result in any Party's incapability or delay\nin  performing  its  obligations  under this  Contract,  such Party shall to the\nextent necessary be excused from performing its obligations  hereunder while the\nForce  Majeure event (or its effects ) are in  existence.  Correspondingly,  the\nterm of performance of contractual obligations by such Party, and the expiration\ndate of the Contract shall be extended. The number of days of postponement shall\nbe the same as those which one or more Force Majeure events have their sustained\nimpact  upon the  period of  material  and  adverse  affect  upon  such  Party's\nperformance of its obligations under this Contract, or\n\n         Provided that notwithstanding anything else to the contrary referred to\nabove,  no relief shall be granted to the affected  Party to the extent that the\naffected  Party would not have been able to perform its  obligations  under this\nContract had the Force Majeure event not occurred.\n\n          The other Party shall not bear any  liability  for any loss or expense\nsuffered by the affected Party as a result of a Force Majeure event.\n\n13.05    ADJUSTMENT TO THE ANNUAL MINIMUM ON-GRID QUANTITY BECAUSE OF FORCE\n\n         If Party A is a affected  by a Force  Majeure  event and is entitled to\nrelief from the performance of its obligations  hereunder in accordance with the\nprovisions  of Section  13.01,  13.02,  13.03 and 13.04 then the Annual  Minimum\nOn-Grid Quantity shall be adjusted as follows:\n\n                                      [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n         Provided that the Annual Minimum  On-Grid  Quantity shall not under any\ncircumstances  be reduced  below that  minimum  volume  necessary to ensure that\nadequate revenue is derived by Party B to enable Liyuan-AES and Hefei Zhongli to\npay the US$ Loan Expenses due under the US$ Loan Contracts.\n\n                              CHAPTER 14 INSURANCE\n\n14.01    INSURANCE FROM THE PARTY B\n\n         Liyuan-AES  and Hefei  Zhongli  shall  jointly  obtain and maintain the\ninsurance listed in Appendix 7 and shall include business  interruption and lost\nprofit insurance caused by machinary  breakdown.  The insurance premium shall be\nincluded in the On-grid Tariff.\n\n14.02    INSURANCE FROM PARTY A\n\n         Party  A  shall  in its own  name  obtain  and  maintain  insurance  in\nconnection  with workers and staff and vehicles and as required by relevant laws\nand regulations of the People's Republic of China.\n\n14.03    ASSISTANCE WITH CLAIMS\n\n         Party A shall comply with all the demands of such  insurance  and shall\nprovide Party B all information  and assistance  within its capability to enable\nParty B to make or process  claims under its  insurance.  Party A shall promptly\nnotify Party B as soon as any accident or event bearing on insurance occurs.\n\n                CHAPTER 15 GOVERNING LAWS AND DISPUTE RESOLUTION\n\n15.01 The  execution,  effectiveness,  interpretation,  performance  and dispute\nresolution of this Contract shall be in compliance with publicly  available laws\npromulgated in the People's Republic of China. Any specific matter in connection\nwith this Contract which is stipulated neither in the publicly available laws of\nChina nor in the international agreement or treaty to which China is a Party may\nrefer  to  generally  accepted  international  practice.  If  there  is any  new\nstipulation in Chinese laws during the  implementation  of this Contract and its\neffectiveness is  retrospective,  the stipulation of the new law shall apply. If\nany Change in Law affects the  implementation of this Contract and the interests\nof any of the  investors,  Party A and  Party B shall  promptly  hold  necessary\nconsultations and make necessary adjustment, and then submit the adjusted matter\nto the relevant  competent  authority  for  examination  and approval , so as to\nensure that the rights  interests and  financial  returns of  Liyuan-AES,  Hefei\nZhongli, the Investors and Party A are not affected by any Change in Law.\n\n\n15.02    DISPUTE RESOLUTION\n\n         Any dispute in relation to or arising from this Contract shall first of\nall be settled by all means through friendly  negotiations by all the Parties in\ndispute.  If the Parties in dispute fail to settle the dispute through  friendly\nnegotiations within 14 days after the dispute in question,  and if the matter in\ndispute  falls within the scope of technical or accounting  expertise,  or it is\nagreed by the Parties in dispute to submit it to the experts for  settlement  or\naccording to the  stipulation  of this  Contract,  then any Party is entitled to\nsubmit the above  dispute to the  experts  for  arbitration  pursuant to Section\n15.03;  as to any other  disputes any party is entitled to submit the dispute to\narbitrate settlement pursuant to Section 15.04.\n\n15.03    EXPERT\n\n     1)   Thenomination of the expert shall be agreed to by the Parties.  If the\n          both Parties fail to designate  jointly an expert  acceptable to them,\n          both Parties shall each  designate one expert and the two experts will\n          jointly designate a third expert to form an expert group.\n\n     2)   Any Party to the dispute shall submit relevant  dispute in the form of\n          written  notice to  experts  for  decision,  and  shall put  forward a\n          written explanation in connection with the dispute.\n\n     3)   Such  expert  has the full  right to  self-determination  to decide on\n          relevant  procedures  within  the  permissible  scope  of law so as to\n          ensure impartial, prompt and economical settlement of the dispute, but\n          such  expert  must  adopt  the  procedures  which  both  Parties  deem\n          appropriate for the settlement of the dispute.\n\n     4)   Unless otherwise  agreed to by both Parties,  such expert shall decide\n          on the matter which is submitted to him (her) for arbitration.\n\n     5)   Such decision must be delivered in written form to both Parties within\n          28 days  after the  submission  of the  written  explanatory  notes as\n          described in Section  15.03(2)  hereof and shall include the result of\n          arbitration and the causes thereto.\n\n     6)   Such expert makes a decision  only in the capacity of an expert within\n          the scope of its professional  function and not in the capacity of and\n          function  as an  arbitrator  under  applicable  laws,  therefore,  any\n          articles and  provisions  of laws that are related to an arbitrator or\n          arbitration  are not  applicable  to such  expert and the  decision he\n          (she) makes, or the procedures by which such expert makes a decision.\n\n     7)   If any Party does not accept the experts decision,  the Parties to the\n          dispute  shall within 14 days and in  accordance  with the  procedures\n          stipulated  above,  jointly  call  in  another  expert  who  shall  be\n          empowered to settle the dispute.  The submission of the dispute to the\n          second  expert for  resolution  for the second time shall abide by the\n          stipulation of Section 15.03 hereof.\n\n     8)   The decision  made by the second  expert for the second time is final,\n          definitely  established  and binding on all the Parties to the dispute\n          which have no right whatsoever to submit such decision to any court or\n          arbitral body.\n\n     9)   The expert  expenses  shall be shared on an average  basis by the both\n          Parties to the dispute,  meantime, the Parties shall bear respectively\n          their expenses for preparing and submitting written  explanatory notes\n          to experts.\n\n15.04    CONSULTATION, MEDIATION, ARBITRATION\n\n         The Parties shall meet within seven (7) days after a Party has received\na written  notice of a dispute from the other Party.  Any dispute may be settled\nthrough friendly consultation or conciliation among the Parties if they agree to\ndo so. Disputes may also be mediated by a third party  appointed  jointly by the\nParties . If the settlement of the dispute by  consultation  or mediation is not\nsuccessful  within  sixty  (60)  consecutive  days of a Party's  receipt of said\nnotice in respect of a dispute,  the  dispute may be  submitted  by any Party to\nbinding, non-appealable arbitration for final adjudication.\n\n         Arbitration Procedures\n\n         Any Party may, after serving notice to the other Party of its intention\nfor  arbitration,  submit the dispute to the China  International  Economic  and\nTrade  Arbitration  Commission for arbitration in accordance with its rules then\nin force. The arbitrated  award shall be final and binding on both Parties.  The\ncosts  of  arbitration  shall  be borne by the  losing  Party  unless  otherwise\nstipulated in the arbitration award.\n\n         The  arbitration  court shall be composed of three  arbitrators  with a\nthird arbitrator whose nationality shall be different from that of the other two\narbitrators. The arbitration shall be made in Chinese and English.\nUnless the Parties otherwise agree, the arbitration shall occur in Beijing.\n\n         The Parties  shall  continue to perform  all of their  obligations  and\nresponsibilities while the arbitration is in process.\n\n                              CHAPTER 16 ASSIGNMENT\n\n16.01  Neither  Party  shall  assign  or  transfer  their  rights,  benefits  or\nobligations  under this  Contract  to any other  Party  except in the  following\ncircumstances:\n\n     1)   Assignment of Party A: Subject to the approval of Party B, Party A may\n          assign its rights and  obligations  under this  Contract  to its legal\n          successor.  Such successor shall provide  evidence to the satisfaction\n          of  Party  B of its  ability,  experience  and  economic  strength  to\n          continue to perform the obligations under this Contract.  In addition,\n          such legal successor shall explicitly agree in written form that it is\n          completely bound by the obligations under this Contract.\n\n     2)   Assignment  of  the  Party  B:  Party  B may  assign  its  rights  and\n          obligations  under this  Contract  to its  Corporation,  subsidiaries,\n          Investors or  associated  company.  Such  assignment  shall be for the\n          purpose of  construction,  ownership  and  operation  of the  project.\n          Meanwhile,  the assignee  shall fully agree in written form that it is\n          bound by the  obligations of Party B under this Contract.  Party B may\n          also  assign its rights and  obligations  under this  Contract  or its\n          revenue from electricity  operation to any financial institution or to\n          other Lenders as security. In case such financial institution or other\n          Lender  exercises its rights under such assignment  security,  or such\n          financial   institution   or  other   Lender   undertakes   Party  B's\n          obligations,  the assignee shall perform Party B's  obligations  under\n          this Contract.\n\n                                CHAPTER 17 NOTICE\n\n17.01 (1) Any notice issued  pursuant to this Contract  shall be made in written\nform, and shall be signed by the officially  authorized staff or  representative\nor any of the following persons of the notice-issuing Party, and is delivered by\ncourier,  or telex or fax to the  following  address or other  address as may be\nnotified to the other Party by the following persons):\n\n         (a) Party A: Anhui Provincial Electric Power Corporation\n             Address:  #415, Wuhu Road, Hefei City, Anhui Province\n             Fax No. :  86-551-3633393\n             Addressee: Cheng Guangjie\n\n         (b) Party B :\n             Anhui Liyuan-AES Power Company Ltd.\n             Address : #415, Wuhu Road, Hefei City\n             Fax No. : 86-551-3637642\n             Addressee : Thomas T.M. Wu\n\n             Hefei Zhongli Energy Company Ltd.\n             Address : #415, Wuhu Road, Hefei City\n             Fax No. : 86-551-3637642\n             Addressee : Thomas T.M. Wu\n\n     (2)  Any of the  above-mentioned  notice  shall  be  deemed  to  have  been\n          delivered or received under the following circumstances;\n\n          (a)  If  delivered  by  hand,  it is  delivered  to or  placed  in the\n               addressee's address;\n\n          (b)  If delivered  by mail,  it is the fifth day (not Sunday or public\n               holiday) after mailing;\n\n          (c)  If  delivered by telex or fax, it is the next day; and any notice\n               sent by telex or fax shall be deemed to have been received  after\n               confirming the correct response code of the text.\n\n17.02    All the notices shall become effective at the actual time of receipt.\n\n\n                           CHAPTER 18 OTHER PROVISIONS\n\n18.01    CONDITIONS\n\nThe rights and obligations of both Parties under this Contract shall be based on\nthe following conditions as conditions precedent:\n\n     1)   All the conditions  precedent stipulated in Section 6.05 of each Joint\n          Venture Contract have been fulfilled;\n\n     2)   The Fuel Oil Supply  Contract and the  Interconnection  Contract  have\n          been  drafted in  accordance  with the  stipulated  form and have been\n          officially executed and come into full force.\n\n         The date of the fulfillment of the above-mentioned conditions precedent\nshall be the date of  effectiveness  of this Contract,  and Party B shall notify\nParty  A  in  written   form  within  five   working  days  after  the  date  of\neffectiveness.\n\n\n18.02    PERFORMANCE GUARANTEE\n\n         Party A shall cause [***] to issue  for  Party  A's  performance of the\npayment  obligations under this Contract a payment guarantee  amounting to [***]\nwith Party B as the beneficiary. If Party A fails to settle the electricity fees\nfor the first half of the Year the  previous  Year before July 14 and January 14\neach Year  respectirely  pursuant  to  Section  10.03 and 10.04 and fails to pay\ntermination  fee pursuant to Section 12.05 of the Contract,  Party B may ask for\npayment from [***].  The  performance  guarantee of payment shall be fully valid\nthroughout the effectiveness of this Contract. The guaranty fee shall be paid by\nParty B and be included in the On-grid Tariff each year.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n18.03    WRITTEN AMENDMENT\n\n         The amendment of this  Contract is subject to written  agreement by the\nboth Parties.\n\n18.04    HEADINGS\n\n         The headings  contained  in this  Contract are inserted for the sake of\nconvenience, they do not constitute a part of this Contract, nor can the heading\nbe used in any form to interpret this Contract.\n\n18.05    WAIVER\n\n         Failure of a Party to exercise and delay in  exercising or carrying out\nany right or remedial  measure under this Contract does not  constitute a waiver\nof such right or remedial  measure.  Separate or partial  exercising or carrying\nout any right or  remedial  measure  under  this  Contract  does not  exclude or\nrestrict further exercising or carrying out such right or remedial measure.  The\nright  and  remedial  measure  stipulated  in  this  Contract  are  concurrently\napplicable  and does not  exclude any right or remedial  measure  stipulated  in\nlaws.\n\n18.06    LANGUAGE\n\n         This  Contract is written in English and Chinese.  Both the English and\nChinese versions are equally authentic.\n\n18.07    FINAL REPRESENTATION\n\n         This Contract  (including  all its  appendices)  represents  the entire\nunderstanding  reached by the both  Parties in respect of the subject  matter of\nthis Contract and shall supersede any written or verbal understanding,  proposal\nor other document in relation to this Contract heretofore.\n\n\n18.08    CONFIDENTIALITY\n\n     1)   A Party shall keep  confidential  the  Contract and  confidential  all\n          agreements  and  documents as well as all other  information  (whether\n          they are technical or commercial  documents)  which are related to the\n          construction,  operation maintenance,  management and financing of the\n          Power  Plant,  which  are of a  confidential  nature.  Except  for the\n          purpose of performing the  obligations  under this  Contract,  all the\n          above-mentioned  agreements,  documents and  information  shall not be\n          made  public  or be  disclosed  or  used  in  other  form  (except  as\n          stipulated by law or relevant management authority, or being disclosed\n          to Party B's  potential  lenders,  Party B's  Investors,  professional\n          consultants  to all the Parties to this  Contract or the  professional\n          consultants to the above-mentioned lenders and Investors).\n\n     2)   The  stipulation  in  Section   18.08(1)  is  not  applicable  to  the\n          following:\n\n          (a)  Any information  which is made public not because of violation of\n               this Contract;\n\n          (b)  The receiving Party has already possessed the information  before\n               the disclosure  herein before,  and such information was obtained\n               without undertaking any obligation of keeping it confidential;\n\n          (c)  Any  information  which is  obtained  from a third  party who may\n               freely disclose it without  undertaking any obligation of keeping\n               it confidential.\n\n18.09    SUCCESSOR AND ASSIGNEE\n\n         This  Contract  is binding on the  Parties to this  Contract  and their\nrespective successors and permissible assignees.\n\n18.10    PARTIAL INEFFECTIVENESS\n\n         If a part of any article of this  Contract is  adjudicated  by a law of\ncompetent  jurisdiction to be unlawful,  invalid or unenforceable,  it shall not\naffect the lawfulness,  validity or enforceability of the other articles of this\nContract,  nor shall it affect the  lawfulness  of any other  provision  of this\nContract.\n\n\n\n\n\n\nIN WITNESS  WHEREOF,  each of the Parties hereto have caused this Contract to be\nexecuted by their duly  authorized  representatives  on the date first set forth\nabove and have caused it to be effective.\n\n\nParty A: Anhui Provincial Electric Power Corporation\n\n         Name :   [Signature Illegible]\n\n         Title :\n\n         Nationality :\n\n\nParty B: Anhui Liyuan-AES Power Company Ltd.   Hefei Zhongli Energy Company Ltd.\n\n         Name :   [Signature Illegible]  Name :            [Signature Illegible]\n\n         Title :                         Title :\n\n         Nationality :                   Nationality :\n\n\n\n\n                            APPENDIX 1 INVOICE FORMAT\n\nInvoice for Electricity Fee Payment from Month:      Date:\nto Month:         Date:\n\n                                    Date of Meter Recording:\n\n                                    Date of Table fill - in:\n\nThis month is the _ month of this Quarter,\nThe meter reading of the  preceding  month was-----------,\nThe meter reading of this month is----------,\nThe Actual On-Grid  Tariff this month is -----------.\nThe Actual  On-Grid  Quantity of the first  month of this  Quarter is --------.\nThe Actual  On-Grid  Quantity of the second month of this Quarter is ---------.\nThe On-Grid Quantity of the third month of this Quarter is----------.\nPayment due under the current month --------------.\nPayment due from previous months---------------\nAmount payable (Payment due under current month + Payment due from previous\nmonths)-----------------\n\n\n                                      [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n                    Sum of money due =\n\n                    1)   For the first, second, fourth, fifth, seventh,  eighty,\n                         tenth, and eleventh month:\n\n                         [***]\n\n                    2)   For the third and ninth month:\n\n                         [***]\n\n                    3)   For the sixth month to be calculated in accordance with\n                         the greater of the following two formulas:\n\n                         [***]\n\n                    4)   for the twelfth month\n\n                         [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n\n\n                       APPENDIX 2 AFTER-TAX CAPITAL RETURN\n\n                                      [***]\n\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n\n                   APPENDIX 3 CALCULATION OF TERMINATION FEES\n\n\n                                     [***]\n\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n\n\n                        APPENDIX 4 ON-GRID TARIFF FORMULA\n\n\n                       ANHUI LIYUAN-AES POWER COMPANY LTD.\n                        HEFEI ZHONGLI ENERGY COMPANY LTD.\n\n\n\n                             ON-GRID TARIFF FORMULA\n\n\n\n\nARTICLE 1.        AGREEMENT\n\nThe formula of  calculating  the  On-grid  Tariff of the Hefei 115MW Gas Turbine\nCombined-cycle  Power Plant is determined through the joint study and discussion\nof all the Investors.  The formation,  structure and calculation  method of this\nformula have been unanimously agreed to and confirmed by all the Investors.\n\n\nThe Investors:\n\nAES Anhui Power Company Limited\n\nAnhui Liyuan Electric Power Development Company Ltd.\n\nHefei Municipal Construction &amp; Investment Company\n\n\nThe Joint Ventures(hereinafter referred as the \"Company\"):\n\nAnhui Liyuan-AES Power Company Ltd. (hereinafter refereed as \"Liyuan-AES\")\n\nHefei Zhongli Energy Company Ltd. (hereinafter refereed as \"Hefei Zhongli\")\n\n\n\n\n\n\n\nARTICLE 2         THE APPROVED ON-GRID TARIFF\n\nIn the  fourth  quarter  of each  Year,  Liyuan - AES and  Hefei  Zhongli  shall\nestimate and submit for approval the On-grid  Tariff of the  succeeding  Year in\naccordance with the following formula:\n\n\n                                      [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\nwhere:\n\n\n                                      [***]\n\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\nThe  agreed   annual   kilowatt-hours   (herein   refereed  as  \"Agreed   Annual\nKilowatt-hours\")refers to the Annual Minimum On-Grid Quantity [***] specified in\nthe Operation and Offtake Contract plus the auxiliary load of the Power Plant.\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\nThe On-grid  Tariff shall be estimated in Renminbi.  The US dollar portion shall\nbe converted at the median price of the official  foreign  exchange  rate on the\nlast business day prior to the estimation of the On-grid Tariff.\n\nFull details and method of calculation are given in Article 3 and 4.\n\n\n\n\n\n\n\nARTICLE 3         METHOD OF THE ON-GRID TARIFF CALCULATION\n\n                                      [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n\n\n\n                ARTICLE 4 ANNUAL ADJUSTMENT TO THE ON-GRID TARIFF\n\n\n                                      [***]\n\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n\n\n\n             APPENDIX 5 METERING AND RECORDING OF ELECTRICAL ENERGY\n\n1.   [***]\n\n[***]  Filed separately with the Commission pursuant to a request for \nconfidential treatment.\n    \n\n2.   Under normal operation,  electricity from the Power Plant to the Power Grid\n     shall be  transmitted  through the --- KV step-up  substation  of the Power\n     Plant----------- and the -- KV transmission lion.\n\n3.   The  accuracy of  electrical  Energy  metering  devices  shall  comply with\n     accuracy standards for Class 1 metering device, namely:\n\n         Active Power Meter:                Grade 0.5\n         Reactive Power Meter:              Grade 2.0\n         PT:                                Grade 0.2\n         CT:                                Grade 0.2\n\n         The metering  devices shall be managed in accordance with  \"Regulations\nfor  Management  of  Electric  Energy  Meters\"  promulgated  by the  Ministry of\nElectric Power.\n\n4.   Under normal  operation,  the  auxiliary  power of the Power Plant shall be\n     provided by the high-voltage station service transformer; in case of outage\n     of the station service transformer, it shall be provided by the KV start-up\n     transformer.\n\n5.   The electricity transmitted from the Power Plant to the Power Grid shall be\n     calculated in accordance with the following formula:\n\n                                      [***]\n\n[***]  Filed   separately  with  the  Commission   pursuant  to  a  request  for\nconfidential treatment.\n\n         This  formula  shall  also be used for  calculate  the  Actual  On-Grid\nQuantity.\n\n6.   The electricity transmitted from the Power Grid to the Power Plant shall be\n     the active power  quantity  measured by KWH meter  Breaker #4, #5 and #6 at\n     the high voltage side of the start-up transformer.\n\n7.   Party B and Party A shall jointly designate the operator of the Power Plant\n     to be responsible for recording all KWH meters.  At noon of the last day of\n     each month or at other time in the same day as agreed upon by the  Parties,\n     Party B and Party A shall send  representatives  to the site to witness the\n     recording. In case that any one party is absent at such an agreed time, the\n     Party present shall  witness the  recording  alone,  and the result of such\n     recording shall be binding on both Parties.\n\n8.   Party B and  Party A shall  jointly  appoint  a  qualified  institution  to\n     calibrate all meters and their auxiliary  equipment every Year. At the time\n     when   calibration   takes   place,   Party  B  and  Party  A  shall   send\n     representatives  to the site to witness the calibration.  In case any Party\n     side is absent at such an agreed time,  the Party present shall witness the\n     calibration  alone, and the result of such calibration  shall be binding on\n     both Parties.\n\n9.   If any Party finds,  for some  reason,  that the above  metering  device is\n     inaccurate,  that party  shall  immediately  notify the other  Party of the\n     situation.  The inaccurate metering device shall be tested and recalibrated\n     promptly.  The output of electric  energy  during the period of  inaccuracy\n     shall be  calculated  at a  temporary  metering  point  determined  by both\n     Parties.\n\n\n                 APPENDIX 6 PRE-OPERATION AND OPERATION SERVICES\n\nPART I   PRE-OPERATION SERVICES\n\n         Before  the  Commercial  Operation  Date  of the  units,  Party A shall\nprovide the following pre-operation services:\n\n1        PREPARATION FOR OPERATION\n         -------------------------\n\n         Party A shall\n\n1.1      in   consultation   with  the  Party  B  establish  the   maintenance\n         and administrative management system for the Power Plant;\n\n1.2      three months prior to the full start-up and interconnection of the Unit\n         I of the Power Plant, formulate and submit to the Party B the operation\n         and safety  codes  applicable  to the Power Plant  (provisional  copy).\n         Within three months after  commencement of commercial  operation of the\n         Power  Plant,  the above codes shall be improved  and  followed  during\n         operation  of the Power  Plant.  Copies of such codes  shall be sent to\n         Party B for the record;\n\n1.3      develop a complete set of training  program for the Power Plant's O &amp; M\n         employees to familiarize themselves with the Power Plant and to fulfill\n         their responsibility satisfactorily. The training program shall include\n         seminars, site visits, and training given by Construction contractor of\n         the Power Plant and equipment manufacturers. The training program shall\n         be based on  technical  data and manuals  provided by the  construction\n         contractor of the Power Plant,  including  information  about start-up,\n         operation, basic maintenance, fire fighting and safety;\n\n1.4      in consultation  with the Party B, formulate a criteria for recruitment\n         of employees of the Power Plant, and recruit  qualified and experienced\n         employees according to such criteria;\n\n1.5      assist Party B in monitoring, operating and testing the Power Plant;\n\n1.6      send to Party B and relevant operational (a) departments technical data\n         and final drawings provided by the construction contractor of the Power\n         Plant,  while the  original  copy of which  shall be debt in the safest\n         place in the Power Plant;\n\n1.7      in  consultation  with Party B,  formulate  a list of all  consumables,\n         spare  parts,  tools  and  materials  needed by the  Power  Plant,  and\n         purchase  the above  things  needed by the Power Plant during the first\n         Year of commercial operation;\n\n1.8      in consultation with Party B, formulate a detailed maintenance plan and\n         methods for the first Year of commercial  operation of the Power Plant;\n         and  in  consideration  of the  rights  and  obligations  of  Party  B,\n         formulate a skeleton plan for the scheduled overhaul for the first two-\n         Year commercial operation of the Power Plant.\n\n\n2        START-UP, INTERCONNECTION, COMMISSIONING AND TEST\n         -------------------------------------------------\n\n         Party A shall\n\n2.1      provide spare parts, consumables,  fuel oil, water, coal and lubricants\n         necessary for timely, safe and stable start-up of the Units;\n\n2.2      be  responsible  for  implementing  and  ensuring the Units to meet the\n         conditions  for  interconnection  as  stipulated  in  Article  2 of the\n         Interconnection Contract;\n\n2.3      provide  sufficient  numbers of qualified and experienced  engineers to\n         perform start-up,  commissioning,  interconnection  and 72-hour and 24-\n         hour performance tests of the Units;\n\n2.4      Provide all necessary  electrical energy for carrying out commissioning\n         of the Power Plant (including those needed for start-up);\n\n2.5      record in detail and keep all the data of the start-up and  performance\n         tests of the Power Plant:\n\n2.6      provide other necessary services.\n\nPART II           OPERATION SERVICES\n\n1        RECRUITMENT AND TRAINING\n         ------------------------\n\n         Party A Shall\n\n1.1      ensure  the  required  personnel  of the  Power  Plant;  in case of any\n         vacancy, recruit qualified and experienced staff;\n\n1.2      provide  relevant class and site training for new  employees,  to train\n         them to be qualified employees for their duties;\n\n1.3      ensure the  continuity of training  programs,  the staff training shall\n         include  safety  measures.  O &amp; M procedures,  and  establish  relevant\n         examination and promotion system;\n\n1.4      provide other necessary services related to recruitment and training.\n\n2        OPERATION OF THE POWER PLANT\n         ----------------------------\n\n2.1      Party A shall maintain, operate, test and inspect the Power Plant:\n\n         1)       to keep the Power Plant in good  condition  during the term of\n                  the Joint Venture Contract.\n\n         2)       to maintain  high  availability  and  efficiency of generation\n                  facilities of the Power Plant:\n\n         3)       to minimize the  occurrence of accidents  and damages,  and to\n                  minimize their duration.\n\n2.2      provide  to the  Party B on a timely  basis  and at  monthly  intervals\n         reports on operation,  repairs,  tests,  maintenance and examination of\n         the Units;\n\n2.3      carry out the  performance  test stipulated by the Ministry of Electric\n         Power for similar thermal power plants;\n\n2.4      ensure  that  the  Power  Plant  shall  abide by all  applicable  laws,\n         regulations, safety rules and other stipulations.\n\n2.5      perform  relevant  obligations  and  responsibilities  of the  Party  B\n         related  to the  operation  of the  Power  Plant as  stipulated  in the\n         \"Interconnection Contract\" and \"Dispatch Contract\"; if any reduction of\n         power generation occurs due to Party A's  responsibility,  Party A (the\n         Operator of the Power Plant) shall indemnify the Party B for the losses\n         incurred by such reductions.  As the operator of the Power Plant, Party\n         A shall  indemnify  the Party B for any penalties  under  Sections 3.7,\n         3.11 and 8.2 of the Interconnection Contract ;\n\n2.6      be responsible for daily  maintenance and overhaul as well as major and\n         minor  repair,  and for  providing  planned  or  provisional  emergency\n         maintenance;\n\n2.7      make annual  generation  and  maintenance  plan in accordance  with the\n         \"Operation and Offtake Contract\" and implement the same;\n\n2.8      dispose of all the unnecessary materials and wastes of the Power Plant.\n\n3.       MANAGEMENT\n         ----------\n\n         Party A shall\n\n3.1      keep  the  Power  Plant  in  good  operation   condition  and  maintain\n         appropriate level of spare parts reservation  according to good utility\n         practice of similar thermal power plants;\n\n3.2      manage the necessary maintenance of the Power Plant;\n\n3.3      in the event of any  emergency or unusual  event  affecting  the normal\n         operation of the Power Plant,  take all necessary  measures to minimize\n         injury to persons and damage to the Power Plant and promptly  report to\n         the  Party B the  nature of such  emergency  or  unusual  event and its\n         consequences.\n\n4.       PROCUREMENT\n         -----------\n\n         Party A shall\n\n4.1      check regularly the demands for spare parts,  consumables and materials\n         of the Power Plant (taking into account the designed life of equipment,\n         actual overhaul records and any technical  changes to the Power Plant),\n         and formulate  corresponding plans and make purchasements  according to\n         these plans;\n\n4.2      be responsible  for organizing the coal supply,  and ensure enough fuel\n         for continuous,  steady and safe operation of the Power Plant, at least\n         to meet the need of generating the Annual Minimum On-Grid Quantity.\n\n5        STATEMENTS AND REPORTS\n         ----------------------\n\n         Party A shall, before delivery of the first Unit for operation, provide\nsuggestions on forms of the following  daily,  monthly and annual  reports,  and\ndetermine the forms in consultation with the Party B.\n\n5.1      DAILY REPORTS\n\n         Party A shall  provide  the  Party B with  daily  reports  on the daily\noperation of the Power Plant, including without limitation the following items:\n\n         1)       net generation of each unit;\n\n         2)       coal consumption of each Unit;\n\n         3)       causes for deviation of each Unit from the daily load curve;\n\n         4)       description of emergencies or unusual events resulting in \n                  deduction of power generation and personal injuries.\n\n5.2      MONTHLY REPORTS\n\n         Party A shall,  within the first 10 days of each month,  provide to the\nParty B a monthly report on the performance of the Units for the previous month.\nThe report shall include, but not be limited to the following:\n\n         1)       statistical statement on operation in the form required by the\n                  Ministry of Electric Power;\n\n         2)       major repair and maintenance activities carried out during the\n                  previous month, and those planned for the next month;\n\n         3)       expenses of the previous  month and those planned for the next\n                  month;\n\n         4)       statistical  statement  of safety and  accidents  of the Power\n                  Plant during the previous month;\n\n         5)       summary of unusual  events and  accidents  during the previous\n                  month,  and measures  already taken by Party A to mitigate the\n                  effects.\n\n5.3      ANNUAL REPORT\n\n         Party A shall,  within  60 days  after the end of each  calendar  Year,\nsubmit to the JV Company an annual report which shall include but not be limited\nto the following:\n\n         1)       statistical summary of annual operation;\n\n         2)       summary of repair and maintenance;\n\n         3)       statistical summary of safety and accidents;\n\n         4)       financial statement;\n\n         5)       summary of any disputes relating to the Power Plant;\n\n         6)       environmental monitoring;\n\n         7)       other information reasonably required by Party B\n\n5.4      OTHER REPORTS\n\n         Party A shall provide:\n\n         1)       a safety report  required by relevant  authority in connection\n                  with personal injuries or damages of the Power Plant\n\n         2)       other reports reasonably required by Party B;\n\n6.       ACCESS TO THE POWER PLANT\n         -------------------------\n\n6.1      Party A shall  provide all necessary  working and living  facilities to\n         the resident representatives of the Party B in the Power plant.\n\n6.2      Party A shall  allow  representatives  or  consultants  from Party B to\n         inspect and monitor the operation of the Power Plant at any time.\n\n6.3      Party  A  shall,  upon  request  of  Party  B,  allow  Party  B or  its\n         representatives to have access at any time to any information, data and\n         records held by Party A.\n\n7.       OTHER RESPONSIBILITY\n         --------------------\n\n         Party A shall be  responsible  for  responding  to other demands on the\nPower Plant raised by relevant authorities in charge of electric power.\n\n\n\n\n\n                         APPENDIX 7 NECESSARY INSURANCE\n\n1        Third party Liability Insurance\n\n2        Personal injury and Medical Insurance\n\n3        Property All Risk Insurance ( Substitute Value)\n\n4        Vehicle Insurance (Vehicles and the Third Party Liability Insurance)\n\n5        Employer's Liability Insurance\n\n6        Profit Loss  Insurance-Limit:  6 month After tax - capital - Return and\n         US$ loan Expenses.\n\n7        Water Transport and Land Transport Cargo Insurance\n\n8        Boiler and Machinery  (including  construction  and operation  periods)\n         Insurance\n\nAll  insurance  shall be bought  in  accordance  with the phase IV Wuhu  Project\nOperation insurance Contract in type term, limits, deductibles. expect as noted.\n\n\n\n\n                          APPENDIX 8 FUEL SPECIFICATION\n\n         ITEM                                        VALUE\n\n         1)  Alkyl 16 min                              50\n\n         2)  Distillate temperature\n               50%, oC, max                           300\n\n               90%, oC, max                           355\n\n               95%, oC, max                           365\n\n         3)  Viscose, 20 oC, cst, max                 3-8\n\n         4)  Residual carbon, (m\/m)                   0.4\n               10% Evaporation  Remains\n\n         5)  Ash, %(m\/m) max                        0.025\n\n         6)  Sulfur contain, % max                    0.2\n\n         7)  Water contain, % max                    mark\n\n         8)  Flash point, oC, min                      60\n\n         9)  Condensing point, oC, max                  0\n\n         10) Copper corrosion, 50 oC, 3 hours   qualified\n \n         11) Acid water dissolved                      no\n\n         12) Actual colloidal, ml\/100mg, max           70\n\n         13) LHV, KJ\/Kg                            43,100\n\n\n\n\n\n                       APPENDIX 9 FUEL OIL SUPPLY CONTRACT\n\nFor this Appendix,  please  reference the Fuel Oil Supply  Contract  entered and\nprovided by Party A.\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6585],"corporate_contracts_industries":[9534],"corporate_contracts_types":[9613,9620],"class_list":["post-42639","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-aes-china-generating-co-ltd","corporate_contracts_industries-utilities__electric","corporate_contracts_types-operations","corporate_contracts_types-operations__services"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42639","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42639"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42639"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42639"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42639"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}