{"id":42679,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/power-purchase-contract-yangcheng-international-power.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"power-purchase-contract-yangcheng-international-power","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/power-purchase-contract-yangcheng-international-power.html","title":{"rendered":"Power Purchase Contract &#8211; Yangcheng International Power Generating Co. Ltd. and Jiangsu Provincial Power Co."},"content":{"rendered":"<pre>\nInformation contained herein, marked with [***], is being filed pursuant to a\nrequest for confidential treatment.                             \n\n\n                            POWER PURCHASE CONTRACT\n\n\n\n\n\n                     RELATED TO THE 6 X 350 MW POWER STATION\n                          IN YANGCHENG, SHANXI PROVINCE\n\n\n\n\n\n\n\n                                 BY AND BETWEEN\n\n\n\n\n\n\n\n            YANGCHENG INTERNATIONAL POWER GENERATING COMPANY LIMITED\n\n                                       AND\n\n                        JIANGSU PROVINCIAL POWER COMPANY\n\n\n\n\n\n\n\n                                TABLE OF CONTENTS\n\nARTICLE 1  DEFINITIONS................................................3\nARTICLE 2  OBLIGATIONS PRIOR TO THE COMMERCIAL OPERATION..............6\nARTICLE 3  COMMENCEMENT OF COMMERCIAL OPERATION.......................7\nARTICLE 4  OPERATION, DESPATCH AND EXAMINATION........................8\nARTICLE 5  ON-GRID TARIFF............................................11\nARTICLE 6  METERING OF ELECTRICITY...................................15\nARTICLE 7  PAYMENT OF ELECTRICITY FEE................................16\nARTICLE 8  BREACH OF CONTRACT AND COMPENSATION.......................17\nARTICLE 9  INSURANCE.................................................19\nARTICLE 10 FORCE MAJEURE.............................................19\nARTICLE 11 ASSIGNMENT................................................20\nARTICLE 12 CONTRACT TERM &amp; TERMINATION...............................21\nARTICLE 13 GOVERNING LAWS AND SETTLEMENT OF DISPUTES.................21\nARTICLE 14 EFFECTIVENESS OF THE CONTRACT AND AMENDMENTS..............22\nANNEX 1..............................................................24\nPOWER STATION OR PROJECT.............................................24\nANNEX 2..............................................................25\nDEDICATED TRANSMISSION FACILITIES....................................25\nANNEX 3..............................................................27\nPERFORMANCE INDICES AND TESTING RESULTS FOR THE UNITS................27\nANNEX 4..............................................................28\nRETURNS ON REGISTERED CAPITAL (ANTICIPATED REVENUE) OVER THE YEARS---26\nANNEX 5..............................................................29\nMETHOD OF ACCOUNT SETTLEMENT FOR THE AMOUNT OF  POWER GENERATED \n     BY THE POWER STATION............................................29\nANNEX 6..............................................................33\nINSURANCE............................................................33\n\n\n\n\n\nParties to the Contract:\n\n         Yangcheng International Power Generating Company Limited ('Party A'), a\nSino-foreign cooperative joint venture enterprise of limited liability which is\nregistered with the State Administration for Industry and Commerce of the\nPeople's Republic of China and which possesses the legal status of a legal\nperson with its legal address at No.151 Shuangtashi Street in Tai Yuan City,\nShanxi Province, the People's Republic of China and its legal representative is\nBian Xuehai [Chinese characters].\n\n\n         Jiangsu Provincial Power Company ('Party B'), a national enterprise of\nthe People's Republic of China owned by the entire people, which is registered\nwith Jiangsu Provincial Administration for Industry and Commerce and possesses\nthe legal status of a legal person with its registered address at #20 Beijing\nXilu, Nanjing, Jiangsu Province and its legal representative is Gu Zhipeng \n[Chinese characters].\n\n\n         WHEREAS, Party A is planning to build, own and operate a power station\nof 6 X 350MW capacity in Yangcheng County of Shanxi Province, and in\nassociation with that Party B is planning to build, own and manage a 500KV\nDedicated Transmission Facilities for the delivery of electricity. Party A shall\nsell to Party B the On-Grid Electricity of the Power Station and Party B shall\nagree to purchase the aforementioned electricity.\n\n\n         Party A and Party B, on the basis of equality and mutual benefit, have\nundertaken negotiations on the sale and purchase of electricity that is\navailable from the 6 X 350MW Power Station, and have concluded this Power\nPurchase Contract (this 'Contract').\n\n\n         Upon its effectiveness, this Contract shall be binding on both Parties,\nand the Parties shall strictly adhere to this Contract.\n\n\n                              Article 1    Definitions\n\n\n\n1.1      'Yangcheng International Power Generating Company Limited' shall be a\n         limited liability company established by North China Electric Power\n         Group Corporation, Jiangsu Province Investment Corporation, Shanxi\n         Energy Enterprise (Group) Company, Shanxi Provincial Power Company,\n         Jiangsu Provincial Power Company and AES China Generating Co. Ltd. in\n         accordance with the 'Company Law of the People's Republic of China' and\n         'Law of the People's Republic of China on Sino-Foreign Co-operative\n         Joint Venture Enterprises' and other relevant Chinese laws,\n         regulations, rules and the Joint Venture Contract of the Company.\n\n\n\n1.2      'Property Right Boundary Point' shall refer to the area within 2 meters\n         from the Connecting Point A located at the terminal tower of the\n         electricity transmission line of the Dedicated Transmission Facilities\n         outside to the enclosing wall of and next to the Power Station as\n         illustrated in Drawing No. 0-3 in Annex 2.\n\n\n1.3      'Power Station' or 'Project' shall refer to the 6 X 350MW\n         coal-fired generating units and related ancillary facilities including\n         the step-up substation and all the electrical equipment, water supply,\n\n\n\n         coal supply and ash disposal systems within the Property Right Boundary\n         Point which shall be invested and constructed by Party A in Yangcheng\n         County of Shanxi Province. For details, refer to Annex 1.\n\n\n1.4      'Dedicated Transmission Facilities' shall refer to the 500KV power\n         transmission and transformation facility extended from the Property\n         Right Boundary Point to the Huaiyin substation in Jiangsu Province. For\n         details, refer to Annex 2.\n\n\n1.5      'Units' shall refer to any of the six 350MW generating units designated\n         as Unit 1 to Unit 6 with each of the Units numbered in accordance with \n         the design drawings.\n\n\n1.6      'Connecting Point' shall be the Property Right Boundary Point which is\n         designated as Point A in Drawing No. 0-3 of Annex 2.\n\n\n1.7      'Unit Supply Capacity' with reference to any Unit of the Power Station\n         shall be the maximum continuous output capacity in kilowatts (that is\n         the gross generating capacity less consumption for the auxiliaries and\n         station use, and transmission losses in the main transformer and\n         busbar) of such Unit of the Power Station available at the Connecting\n         Point as determined by tests carried out pursuant to Annex 3 before\n         going into Commercial Operation of such Unit. Refer to Annex 3 for\n         specific indices.\n\n\n1.8      'On-Grid Electricity' shall mean for any period, the electricity\n         generated and delivered by the Power Station to the Connecting Point\n         that is qualified in accordance with the electricity quality standards\n         of the state and is measured, in kilowatt hour ('KWH'), by the electric\n         energy metering equipment provided for under Article 6.1 at the 500KV\n         side near the Connecting Point.\n\n\n1.9      'Effective On-Grid Electricity' shall refer to the on-grid electricity\n         in KWHs which is derived from deducting the electricity counted as 'no\n         metering of electricity and no payment' stipulated in Article 3.4 of\n         Annex 5 from the On-Grid Electricity stipulated in Article 1.8.\n\n\n1.10     'Normal Take' shall refer to the minimum amount of Effective On-Grid\n         Electricity in KWHs in each year during the effective term of this\n         Contract that Party B agrees to purchase from Party A after the Units\n         have gone into Commercial Operation and shall equal to:\n\n          6\n         SIGMA Supply Capacity of Unit i  x  Annual Utilization Hours of \n         i=1                                 Unit i in the Year\n\n         Where:\n\n\n         i =1 to 6, referring respectively to Unit 1 through Unit 6\n\n\n         Annual Utilization Hours for the Unit shall be:\n\n\n         (1)      For the calendar Year in which the Unit goes into Commercial \n                  Operation,\n\n\n\n                  [***] hours x (A\/365)\n\n\n         in which:\n\n\n         A is the number of the days counting from the day on which the Unit is\n         put into Commercial Operation to 31st December of that Year.\n\n\n         (2)  For each calendar Year before 31st December 2010,  [***] hours;\n\n\n         (3)  For the Year 2011, [***] hours;\n\n\n         (4)  For each calendar Year from 2012 to 2015, [***] hours;\n\n\n         (5)  For the Year 2016, [***] hours x (B\/365)\n\n\n         in which:\n\n\n         B is the number of the days counting from 1st January of that year to\n         the day on which the Joint Venture Term expires.\n\n\n1.11     'On-Grid Tariff' shall mean the various On-Grid Tariff expressed in RMB\n         Yuan per KWH corresponding to the On-Grid Electricity as defined in\n         Article 1.8, calculated in accordance with the principles, methods and\n         procedures set forth in Article 5, and approved by relevant competent\n         pricing authorities of the State.\n\n\n1.12     'Sales Tariff' shall mean the sales tariff expressed in RMB Yuan per\n         KWH and approved by relevant competent pricing authorities of the\n         State, corresponding to the On-Grid Electricity which Party B shall\n         purchase from Yangcheng Power Station pursuant to the On-Grid Tariff\n         stipulated in Article 1.11 and shall be delivered to the consumers in\n         the Province through electricity supply networks.\n\n\n1.13     'Electricity Fee' shall mean the payments expressed in RMB Yuan to be\n         made by Party B to Party A pursuant to Article 7 in respect of the\n         On-Grid Electricity purchased at the Connecting Point by Party B\n         pursuant to Article 6, and to be calculated pursuant to the On-grid\n         Tariff as stipulated in Article 5 of this Contract.\n\n\n1.14     'Interconnection and Despatch Agreement' shall mean the Interconnection\n         and Despatch Agreement executed between Party A and the State\n         Electricity Despatch and Communication Centre for the Yangcheng Power\n         Station.\n\n\n1.15     'Despatch Agreement' shall mean the Despatch Agreement executed between\n         Party B and the State Electricity Despatch and Communication Centre for\n         the delivery of electricity through the Dedicated Transmission\n         Facilities of Yangcheng Power Station.\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n\n1.16     'Commercial Operation' shall mean, for each Unit, the formal\n         commencement of electricity generation acknowledged by Party A after\n         the satisfactory completion of performance tests for the Unit executed\n         in accordance with Article 3.\n\n\n1.17     'Registered Capital' shall mean the total equity capital contributions\n         actually made by the joint venture partners of Party A in accordance\n         with the Joint Venture Contract.\n\n\n1.18     'Joint Venture Contract' shall mean the Joint Venture Contract executed\n         on 22nd August 1996 under which Party A was established and any of its \n         subsequent amendments.\n\n\n1.19     'Joint Venture Term' shall mean the period of time from the date (10th\n         October 1996) on which Party A has obtained its business license from\n         the State Administration for Industry and Commerce until the expiration\n         of the Joint Venture Contract.\n\n\n1.20     'Completion Exchange Rate' shall mean the exchange rate (expressed in\n         RMB per USD) used in converting the US Dollars expenditure in the total\n         investment of the Power Station into RMB value for final account\n         settlement in order to determine the original value of the assets of\n         the Power Station at the completion of the construction of the Power\n         Station, but before Unit 6 is put into Commercial Operation, it shall\n         be equal to the Budgeted Exchange Rate.\n\n\n1.21     'EPC Contract' shall mean the Engineering, Procurement and Construction\n         Services Contract entered into by and between Party A (as the Owner)\n         and Shanxi Provincial Power Company (as the EPC Contractor).\n\n\n1.22     'Excess On-Grid Electricity' shall have the definition as stipulated in\n         Article 7.5 herein.\n\n\n1.23     'Party A's Liability for Short Generation' shall have the definition as\n         stipulated in Article 4.6 herein.\n\n1.24     'Party B's Liability for Short Purchase' shall have the definition as\n         stipulated in Article 4.6 herein.\n\n\n1.25     'State Despatch Center's Liability for Short Despatch of Electricity'\n         shall have the definition as stipulated in Article 4.6 herein.\n\n\n1.26     'Budgeted Exchange Rate' shall have the definition as stipulated in \n         Article 5.2 herein.\n\n\n1.27     'Income Tax Rate' shall refer to the tax rates applicable to the\n         enterprise income tax and the local income tax that Party A is liable\n         to pay in accordance with the Income Tax Law for Foreign Invested\n         Enterprises.\n\n\n            Article 2 Obligations Prior to the Commercial Operation\n\n\n2.1      Prior to Party A's issuance of the Notice to Proceed under the EPC\n         Contract to the EPC Contractor:\n\n\n\n(1)      Party A shall execute the EPC Contract.\n\n\n(2)      Party A shall execute the Coal Supply Contract for coal needed by the \n         Power Station.\n\n\n(3)      Party B shall co-operate fully with Party A in providing required\n         information and convenience during Party A's negotiations with third\n         party lenders.\n\n\n(4)      Party B shall provide Party A with acceptable comfort letters issued by\n         Jiangsu Provincial Government or provincial organs for Party B's\n         performance of all the provisions of this Contract.\n\n\n2.2      Party A shall cause Unit 1 to go into Commercial Operation within \nthirty five (35) months after the Ministry of Electric Power grants approval to\nParty A for the issuance of the Notice to Proceed under the EPC Contract to the\nEPC Contractor, and thereafter Unit 2, Unit 3, Unit 4, Unit 5 and Unit 6 to go\ninto Commercial Operation respectively at an interval of every five months.\n\n\n2.3      Party A shall cooperate fully with Party B in providing required \ninformation and convenience during Party B's negotiations with third party \nlenders.\n\n\n2.4       When the conditions are mature for the construction commencement of\nDedicated Transmission Facilities, Party B shall submit the commencement of\nconstruction of the Project to the Ministry of Electric Power for approval, but\nParty B shall guarantee to complete the Dedicated Transmission Facilities 3\nmonths ahead of the date as stipulated in Article 2.2 on which the first Unit of\nthe Power Station goes into Commercial Operation in order to satisfy the testing\nand interconnection requirements of the Power Station.\n\n\n2.5       The Parties shall strive to ensure the concurrent construction of the \nPower Station, Dedicated Transmission Facilities and provincial transmission\nfacilities.\n\n\n                 Article 3 Commencement of Commercial Operation\n\n\n3.1       Party A shall conduct performance tests (See Annex 3 for major \nperformance indices and test results) on each Unit in accordance with the EPC \nContract. The date on which Party A issues the Commercial Operation Acceptance \nCertificate for any Unit to the EPC Contractor in accordance with the EPC \nContract shall be the Date of Commencement of Commercial Operation of such Unit.\n\n\n3.2       Party B shall agree to accept and purchase all the electricity \ngenerated by each Unit during the testing period and prior to the Commercial \nOperation.\n\n\n3.3       Upon the Commencement of Commercial Operation of the Units, the \nEffective On-Grid Electricity which Party B shall agree to purchase from Party A\nin each Year shall not be less than the Normal Take.\n\n\n\n                  Article 4 Operation, Despatch and Examination\n\n\n4.1       The Power Station and the Dedicated Transmission Facilities shall obey\nthe unified despatch of the State Power Despatch and Communication Centre \n('State Despatch Centre').  The Interconnection and Despatch Agreement and the \nDespatch Agreement shall be concluded separately.\n\n\n4.2       Refer to Annex 3 for the range of electricity output of the Units that\nis despatchable. (The design value of the range of electricity output of the \nUnits that is despatchable is 50-100% of the rated capacity). With reference to\ngenerating units of similar type in the East China and Jiangsu Power Grids, and\ntaking into account the economic factors and special characteristics of a\nmine-mouth unit using anthracite as fuel, the Power Station shall reasonably\nundertake the tasks of base load, peaking, frequency modulation and voltage\nregulation of the power grid and shall be operated in accordance with the\ngeneration despatch plans and despatch orders issued by the State Despatch\nCentre.\n\n\n         The annual, monthly and daily generation despatch plans of the Power\nStation shall, pursuant to Party B's power purchase plan and the operating\nstatus of the equipment of the Power Station, ensure that Party A and Party B\nare able to satisfy the Normal Take and to leave an appropriate margin for\nunseen circumstances within the annual planned despatchable hours of the Units.\n\n\n         The equipment maintenance plans of the Power Station which shall take\ninto consideration the status of the equipment of the power grid and the Power\nStation and the requirement to satisfy the Normal Take, and, in accordance with\nthe maintenance cycle and time stipulated under 'The Maintenance Regulations of\nthe Power Station' promulgated by the Ministry of Electric Power, shall be\narranged by the State Despatch Centre after overall co-ordination together with\nParty A, Party B and relevant authorities.\n\n\n4.3       In mid-July each Year, Party A shall submit to the State Despatch \nCentre the proposed operation plans and equipment maintenance plans of the Power\nStation for the following Year. At the end of August each Year, Party B shall \nsubmit to the State Despatch Centre the proposed power purchase plan for the \nfollowing Year. The State Despatch Centre shall issue to Party A with a copy to \nParty B, a prearranged plan for the following Year in December of each Year \nafter co-ordinating and reaching a balance with Party A and Party B.\n\n\nBefore the 15th of each month, Party A shall submit to the State Despatch Centre\nthe proposed operation plan and equipment maintenance plan of the Power Station\nfor the following month; before the 20th of each month, Party B shall submit to\nthe State Despatch Centre the power purchase plan for the following month; the\nState Despatch Centre shall issue to Party A with a copy to Party B, a\ngeneration despatch plan and equipment maintenance plan for the following month\nbefore the 25th of each month after co-ordinating and reaching a balance with\nParty A and Party B.\n\n\n4.4       Together with Party A and Party B, the State Despatch Centre shall \nformulate a typical daily load curve of the Power Station for the current month \nin accordance with the monthly generation despatch plan.\n\n\n4.5       Party A shall ensure that the Annual Planned Despatchable Hours of the\nPower\n\n\n\n                                \n          Station is equal to:\n\n             N\n         [(SIGMA) (Annual Planned Despatchable Hours of the Unit x Di\/8760)]\/N \n            i=1        \n\n          In the above formula, the Annual Planned Despatchable Hours of the \nUnit shall be 7,350 hours for the Year(s) of and before the Commencement of\nCommercial Operation of Unit 6 (assuming that during such Year the Commercial\nOperation hours of the Units that have gone into operation are 8760 for each\nUnit) and 7,400 hours for each Year subsequent to the Year of Commencement of\nCommercial Operation of Unit 6.\n\n\n\n\n\n                                                                  N\n                                                               (SIGMA) Di\n                                                                 i=1\n       Annual Actual Despatchable Hours of the Power Station = -----------   -\n                                                                   N\n\n       Reduction in Despatchable Capacity of the Power Station in Equivalent \n       Annual Hours\n\n\n          Where:\n\n\n          Di shall mean the total number of hours of Commercial Operation of \n          Unit i during such Year;\n\n\n          N shall mean the number of Units which have already been put into\n          Commercial Operation in such Year.\n\n\n          Reduction in Despatchable Capacity of the Power Station in Equivalent\n          Annual Hours shall mean the annual cumulative and equivalent hours of\n          outages owing to the reduction in Supply Capacity Available for\n          Despatch during the despatch and operation of the Power Station,\n          namely:\n\n\n          Reduction in Despatchable Capacity of the Power Station in Equivalent \n          Annual Hours =\n\n\n         (SIGMA) {[(Supply Capacity Available for Despatch of the Power Station\n         - Actual Supply Capacity Available for Despatch of the Power Station) \/\n         Supply Capacity Available for Despatch of the Power Station] x Number\n         of Continuing Hours in Such Period}\n\n\n          Where:\n\n\n          Supply Capacity Available for Despatch of the Power Station is the sum\n          of the Supply Capacity Available for Despatch of the various Units of\n          the Power Station which have already been put into Commercial \n          Operation (see Annex 3).\n\n\n\n          Actual Supply Capacity Available for Despatch of the Power Station is\n          the sum of the Supply Capacity Available for Despatch actually \n          provided by the various Units of the Power Station which have already \n          been put into Commercial Operation when the reduction in Supply \n          Capacity Available for Dispatch occurs in such Units.\n\n\n          Number of Continuing Hours in Such Period shall mean the Number of\n          Continuing Hours during which the reduction in Supply Capacity\n          Available for Dispatch occurs in the various Units of the Power \n          Station which have already been put into operation.\n\n\n4.6       If in any Year within the term of the Contract the annual cumulative \ntotal quantity of On-Grid Electricity fails to reach the Normal Take, when the\ndifference is caused by the failure of the Actual Annual Despatchable Hours of\nthe Power Station to meet the Annual Planned Despatchable Hours of the Power\nStation, the electricity not generated shall be recorded as a short generation\nfor which Party A shall be liable and which shall be handled in accordance with\nArticle 8.2.\n\n\n         Party A's Liability for Short Generation = Annual Normal Take x\n         [(Annual Planned Despatchable Hours of the Power Station - Annual\n         Actual Despatchable Hours of the Power Station) \/ Annual Planned\n         Despatchable Hours of the Power Station]\n\n\n         If, pursuant to stipulations in the 'Interconnection and Despatch\nAgreement', the reduction in electricity generation and purchase is determined\nas being attributable to despatch reasons of the State Despatch Centre, it shall\nbe recorded as the State Despatch Center's liability for a short despatch of\nelectricity.\n\n\n         The reduction in electricity generation by the Power Station due to\nreasons caused by Party B's power purchase plan and the downward adjustment of\nthe output of the Units as required by the power grid, and the failure of the\nUnits to generate the expected output because of the breakdown of the Dedicated\nTransmission Facilities shall be adjusted and compensated as far as possible in\nthe plans of the current Year. After the above adjustment is made, the portion\nof electricity generation falling short of the Normal Take shall be recorded as\nParty B's Liability for Short Purchase and shall be handled in accordance with\nArticle 8.1.\n\n\n4.7       Before 0930 hours each day, the Power Station shall submit to the \nState Despatch Center a forecast of the Supply Capacity Available for Despatch \nof each Unit for the following day. Pursuant to the monthly generation despatch \nplan and upon liaison with Party B, the State Despatch Centre shall issue before\n1700 hours of each day the daily generation despatch plan of the Power Station \nfor the following day with a copy to Party B.\n\n\n4.8       The Power Station shall be operated in compliance with the daily \ngeneration despatch curves (including such curves as revised in accordance with \nArticle 2 of Annex 5) issued by the State Despatch Centre with the active power\nfluctuations within the permissible variation range of +\/-3%.\n\n\n\n          Examinations shall be executed in accordance with the daily generation\ndespatch curves (including such curves as revised in accordance with Article 2\nof Annex 5) on the basis of the real time data which Party A transmits to the\nState Despatch Centre. Refer to Annex 5 for the actual method adopted in the\nsettlement of accounts on the amount of power generated by the Power Station,\nand the State Despatch Centre shall record such data at intervals on a daily\nbasis.\n\n\n          In the event that any Party discovers at any time the transmitted real\ntime data inaccurate, such Party may request for examination and calibration and\nthe real time data shall be corrected in accordance with the results of the\nexamination and calibration.\n\n\n4.9       The State Despatch Centre shall inform Party A and Party B in writing \nof the examination results regarding the status of the Power Station's execution\nof the generation despatch curves in the preceding month on the fifth working \nday of each month. Any disagreement relating to the examination results raised\nby Party A and Party B shall be submitted to the State Despatch Centre before\nthe 12th of the month. When the said deadline expires and no query is raised, \nthe original notice of the examination results shall be deemed to be correct.\n\n\n          The State Despatch Centre shall send the finalised and audited\ngeneration examination notice of the preceding month to Party A and Party B\nbefore the 20th of each month as the basis for settlement of accounts between\nboth Parties.\n\n\n                            Article 5     On-Grid Tariff\n\n\n5.1       The On-Grid Tariff shall be estimated by Party A in accordance with \nthe formulae stipulated in Article 5.4 and Article 5.5 on the basis of the\nprinciples of the Power Supply Costs of the Power Station, timely repayment of\nprincipal and interest on loans, payment of taxes, collection of funds and\nguaranteeing of Party A's reasonable profits, on the basis of the FIRR of [***]\non Party A's anticipated Registered Capital during the\nJoint Venture Term and on the basis of the Normal Take. The average On-Grid\nTariff during the Joint Venture Term as specified in the Feasibility Study\nReport approved by the State Planning Commission is [***] on the\nbasis of [***] utilisation hours while the actual tariff in\neach Year shall be submitted for examination and approval year by year pursuant\nto Article 5.6.\n\n\n5.2       Party A and Party B shall jointly fix the Budgeted Exchange Rate \n(the US Dollar Selling Price set by the People's Bank of China) on the basis of\nthe trend of the USD\/RMB exchange rate fluctuations of the preceding Year and \nuse such Budgeted Exchange Rate for the conversion of the USD component of the\nOn-Grid Tariff into RMB in the estimation of the On-Grid Tariff fully\ndenominated in RMB. The USD component of the On-Grid Tariff shall constitute the\nprincipal and interest on the foreign currency loans paid by Party A for the\nYear and the return on Party A's Registered Capital during the Year. Any\nexchange loss or gain due to the difference between the actual exchange rates\nduring the Year and the Budgeted Exchange Rate shall be adjusted in the next\nestimation of the On-Grid Tariff.\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n5.3       The On-Grid Tariff for the electricity generated and delivered to the\nConnecting Point prior to the Commercial Operation of any Unit, including the\nperiod of testing and commissioning of the Unit, shall be settled on the basis\nof [***].\n\n5.4       After the commencement of Commercial Operation of any Unit, the \nOn-Grid Tariff for the On-Grid Electricity generated each Year within the Normal\nTake shall be expressed in RMB per KWH, estimated in accordance with the\nfollowing formula:\n\n                                          \n                            \n     On-Grid Tariff                   \n     during Commercial  =          [***]\n     Operation                                \n                                       \n\n\n\n\n\n         Where:\n\n\n         (A)  A is the Power Supply Cost of the Power Station (not including\n         purchase value added tax), including:\n\n\n         A1, fuel cost: refers to all the annual budgeted expenses related to\n         the purchase of fuels (including coal and oil) for the Power Station,\n         including among others management fee, transportation expenses,\n         insurance costs, handling charges, transhipment costs and other costs,\n         and the gain or loss due to the difference between the budgeted price\n         and the actual price for the fuels for the previous year. The coal\n         price shall follow the price for coal used in electricity generation in\n         Shanxi Province.\n\n\n         A2, water rate: refers to the annual budgeted expenses for water \n         consumed in power generation by the Power Station.\n\n\n         A3, electricity purchase cost: refers to the cost for the electricity\n         that the Power Station is required to purchase from outside each year\n         on the basis of its rated design capacity.\n\n\n         A4, material costs: refers to the costs of operation and maintenance\n         materials consumed each Year for maintaining the operation of the Power\n         Station.\n\n\n         A5, wages and welfare expenses: refers to the wages and welfare\n         expenses paid by Party A each Year to its employees.\n\n\n         A6, depreciation and amortization costs: refers to the depreciation\n         cost of the fixed assets and amortization cost of intangible assets and\n         other assets, allocated each Year according to relevant stipulations\n         after any Unit of the Power Station goes into Commercial Operation.\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n         A7, major repair cost: refers to the annual budgeted cost for major and\n         minor repairs of the Units of the Power Station.\n\n\n         A8, other business management costs: refers to other expenses and costs\n         related to the operation, maintenance and management of the Power\n         Station each Year, including but not being limited to insurance costs,\n         staff education and training costs, business management costs of Party\n         A, the adjustment amount for exchange loss or gain for the previous\n         Year, costs resulting from changes in law, etc.\n\n\n         (B)   B is the Financial Expenses, referring to: the sum of interest\n         charges, on-lending fees, handling fees, other financial management\n         costs according to relevant financial regulations and foreign currency\n         exchange loss or gain, incurred each Year on the construction loans and\n         the working capital loans of the Power Station.\n\n\n         The exchange loss or gain shall be: USD Loan Principal repayable by\n         Party A for the Year x (Budgeted Exchange Rate - Completion Exchange \n         Rate)\n\n\n         (C)   C is all relevant taxes, other than the income tax and the value\n         added tax, which are payable during the business operation of the Power\n         Station according to relevant regulations (State-stipulated taxes or\n         local taxes). These taxes shall be incorporated into the Power Supply\n         Costs of A1 to A8.\n\n\n         (D)   D is the Return on Registered Capital and shall be equal to the\n         product of (i) during the Joint Venture Term, the anticipated US\n         Dollars amount of return over the years calculated on the basis of the\n         Normal Take and [***] on Party A's Registered Capital,\n         and (ii) the Budgeted Exchange Rate. Such anticipated returns on Party\n         A's Registered Capital for each Year are listed in Annex 4.\n\n\n         (E)   E is the Loan Repayment Profit and shall mean that during the\n         repayment of loans by Party A, the portion of the after-tax profit used\n         to pay the shortfall in the repayment of the principal of loans payable\n         for the Year which the above A6, to be used for loan repayment, is not\n         sufficient to cover.\n\n\n         Loan Repayment Profit = [US Dollar Loan Principal Repayment Payable by\n         Party A for the Year x Completion Exchange Rate + RMB Loan Principal\n         Repayment Payable by Party A for the Year] - [Depreciation and\n         Amortization set forth in Item A6 above]\n\n\n         The Loan Repayment Profit shall be no less than zero.\n\n\n         (F)   F is the Fund Allocation and shall mean the accumulation fund,\n         the public welfare fund, and other funds for the Power Station\n         allocated by Party A in accordance with relevant regulations of the\n         People's Republic of China.\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n5.5       The On-Grid Tariff for Excess On-Grid Electricity: In the event that\nduring the term of this Contract, the total actual purchase and sales of \nelectricity for any one Year exceeds the Normal Take, that portion of the \nOn-Grid Electricity exceeding the Normal Take shall be paid for on the basis of \nthe On-Grid Tariff for Excess On-Grid Electricity.\n\n\n         The formula for the On-Grid Tariff for Excess On-Grid Electricity shall\nbe as follows:\n\n\n\n\nOn-Grid Tariff\nfor Excess     =      [***]\nOn-Grid\nElectricity\n\n\n         The definitions of the terms A, A6, A7, D and F shall be the same as\nthose provided in Article 5.4.\n\n\n5.6       The On-Grid Tariff shall be fully denominated in RMB and shall be set\nonce a year. Party A shall calculate the On-Grid Tariff for the following Year \nin October of each Year; Party A and Party B shall raise through consultation a\nproposal on the subject and submit the proposal in mid-November in accordance\nwith relevant state stipulations to Chief Commodity Prices Administrative\nAuthorities of the State Council for examination and approval. Party B shall put\nforward a proposal on the corresponding Sales Tariff based on the On-Grid Tariff\nwhich Parties A and B have agreed on for submission and submit the proposal in\nmid-November in accordance with the same application procedures to Chief\nCommodity Prices Administrative Authorities of the State Council for examination\nand approval.\n\n\n5.7       In order to forecast the On-Grid Tariff during the Joint Venture Term,\nParty A and Party B shall, promptly following the execution of this Contract and\npursuant to the principles and contents set forth in the above articles, agree\non a financial model and a mechanism to obtain and adjust quantified figures on\nfactors affecting the calculation of the tariff which shall serve as the basis\nfor calculating the On-Grid Tariff. Six months prior to the expected Commercial\nOperation of the first Unit, Party A shall estimate the On-Grid Tariff for\nCommercial Operation of such Unit which, upon approval through the approving\nprocedures under Article 5.6, shall be the On-grid Tariff for settlement of the\nElectricity Fee between Party A and Party B.\n\n\n5.8       If the On-Grid Tariff calculated on the basis of current external \nfactors such as the price level, exchange rate and tax rates during any Year \nexceeds the approved On-Grid Tariff for that Year by more than 2%, which results\nin that the approved On-Grid Tariff cannot meet the repayment of either \n(i) principal and interest (including both RMB and US Dollars loans) or (ii) \nanticipated Return on Party A's Registered Capital, Party A and Party B shall \npromptly submit an application for adjustments to the On-Grid Tariff and Sales \nTariff for the Year and submit it to the state pricing authorities for approval.\nUpon approval, such adjustments shall be implemented.\n\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n                        Article 6 Metering of Electricity\n\n\n6.1       Party A shall install dedicated energy metering equipment, including \nmain meters and check meters on each 500KV outgoing line at the inner side near \nthe Connecting Point for the measurement of the On-Grid Electricity that Party B\npurchases from Party A. The energy metering equipment installed by Party B at\nthe incoming side of each 500KV line at San Bao Switchgear Station in Jiangsu\nProvince shall be used as reference for checking the dedicated energy\nmeasurement.\n\n\n6.2       The accuracy of the dedicated energy metering equipment shall be no\nlower than the accuracy standards related to electric energy meters promulgated\nby the State Technology Inspection Bureau as follows:\n\n\n         Active energy meter :      Grade 0.2\n\n\n         Reactive energy meter:     Grade 0.5\n\n\n         Associated current transformer and potential transformer:  Grade 0.2\n\n\n6.3       The Dedicated energy metering equipment shall be inspected and \ncalibrated by an inspection and calibration team established jointly by Shanxi \nProvincial Electrical Testing Centre and Jiangsu Provincial Electrical Testing \nCentre on a regular basis and within a time period as required by the codes of \nelectrical metering. The inspection and calibration results shall be sent to \nParty A and Party B respectively. The costs incurred shall be borne by the two \nParties in relation to the ownership of assets.\n\n\n6.4      The readings of the aforesaid meters shall be taken and recorded\njointly by Party A and Party B on the first day of each month. The On-Grid\nElectricity that Party A transmits to Party B during the preceding month shall\nbe the sum of the new increments in the readings of the applicable main energy\nmeters during that month. Such metered number shall be final if no fault or\nomission exists. In case that the main energy meters fail to measure the On-Grid\nElectricity accurately, the main energy meters and the check energy meters shall\nbe inspected separately. If the check energy meters prove to be accurate, the\nreadings of the check energy meters shall be the data used for calculating the\nOn-Grid Electricity.\n\n\n6.5       Party A shall notify Party B promptly of the failure of the Dedicated \nenergy metering equipment. If both main meters and check meters fail at the same\ntime, the measurement of On-Grid Electricity during the failure period can be \nresolved through consultation between both Parties by referring to other energy \nmeters or be resolved through consultation with State Power Despatch and \nCommunication Centre in accordance with despatch records.\n\n\n6.6       If any Party finds out at any time that the readings of a Dedicated\nenergy metering equipment are not accurate, such Party may propose an interim\ninspection and calibration.\n\n\n\n6.7       Party A shall install telemetry equipment in the Power Station and \nmake them having the function of transmitting real time information about the \non-grid capacity and On-Grid Electricity of the Power Station to Party B and \nState Power Despatch and Communication Centre.\n\n\n                            Article 7 Electricity Fee\n\n\n7.1       Within the first five (5) working days of each month, Party A shall \ndeliver to Party B the first invoice, which shall specify the following items:\n\n\n         (1)   40% of the On-Grid Electricity, read according to Article 6.4,\n         which Party A has transmitted to Party B in the preceding month.\n\n\n         (2)   the applicable On-Grid Tariff.\n\n\n         (3)   Electricity Fee payable by Party B to Party A = (1) x (2).\n\n\n         Prior to the twentieth (20th) day of each month, Party A shall deliver\n         to Party B the second invoice which shall specify the following items:\n\n\n         (1)   30% of the On-Grid Electricity, read according to Article 6.4,\n         which Party A has transmitted to Party B in the preceding month.\n\n\n         (2)   the applicable On-Grid Tariff.\n\n\n         (3)   Electricity Fee payable by Party B to Party A = (1) x (2).\n\n\n         Before the end of each month Party A shall deliver to Party B the\nmonth-end invoice in accordance with the notice of verification of power\ngeneration in the proceeding month examined and verified by the State Despatch\nand Communication Centre and, the account settlement notice of the Power Station\nin the preceding month issued by Party B. The amount payable in such invoice\nshall be:\n\n\n         (The Effective On-Grid Electricity which Party A transmitted to Party B\nin the preceding month - the electricity already paid for in the first and\nsecond invoices) x the applicable On-Grid Tariff pursuant to Article 5 +\/-\nthe amount stipulated in Article 7.6.\n\n\n7.2      The Electricity Fee shall be paid in three instalments in each month:\n\n\n         (1)  on the 5th working day of each month, Party B shall remit the\n         Electricity Fee payable by Party B that is specified in the first\n         invoice provided by Party A for the preceding month to the China\n         Construction Bank account designated by Party A.\n\n\n         (2)  on the 20th day of that month, Party B shall remit the Electricity\n         Fee payable by Party B that is specified in the second invoice provided\n         by Party A to the China Construction Bank account designated by Party\n         A.\n\n\n\n         (3)  before the end of the month, Party B shall remit the Electricity\n         Fee payable by Party B that is specified in the month-end settlement\n         invoice provided by Party A to the China Construction Bank account\n         designated by Party A .\n\n\n7.3       Party B shall pay Party A the Electricity Fee in accordance with \nArticle 7.2. In the event that Party B disputes the Electricity Fee in the \nmonth-end settlement invoice provided by Party A, Party B shall nevertheless pay\nthe non-disputed amount; upon resolution of the dispute, Party B shall pay the\ndisputed amount immediately. Party B shall pay Party A late payment fee in\naccordance with Article 8.4 for the delayed amount payable because of the\ndispute.\n\n\n7.4       Party A shall issue to Party B the value added tax invoice following \nthe payment schedule and in accordance with tax laws.\n\n7.5       When the actual cumulative Effective On-Grid Electricity that\nParty A transmits to the Connecting Point during the current year exceeds the\nNormal Take for such Year ('Excess On-Grid Electricity'), Party B shall pay the\nElectricity Fee to Party A calculated on the basis of the On-Grid Tariff for\nExcess Electricity as stipulated in Article 5.5, but after deduction of the\namount payable to Party B calculated according to the following formula:\n\n\n\nThe Amount\nPayable to =     [***]\nParty B\n                                    \n\n\n         Where:\n\n\n         D and F shall have the same definitions as in Article 5.5.\n\n\n7.6       After the Units of the Power Station enter into Commercial Operation, \nthe results of verification of generation for account settlement of the Power\nStation as stipulated in Annex 5 shall be settled together with the Electricity\nFee by Parties A and B on a monthly basis. Refer to Annex 5 for specific methods\nof account settlement.\n\n\n                  Article 8 Breach of Contract and Compensation\n\n\n8.1       During the term of this Contract, Party B shall guarantee that the \nEffective On-Grid Electricity procured by Party B at the Connecting Point in \nevery Year shall be no less than the Normal Take. In the event that at the last \nday of any Year within the Contract term, the actual cumulative Effective \nOn-Grid Electricity procured by Party B for the whole Year is less than the \nNormal Take, Party B shall pay Party A within forty five (45) days after the end\nof such Year an amount as follows:\n\n\n                                      [***]\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n                                      [***]\n\n\n8.2       During the term of this Contract, Party A shall guarantee that the\nEffective On-Grid Electricity delivered by Party A to Party B each Year shall be\nno less than the Normal Take. In the event that at the last day of any Year \nwithin the Contract term, the total cumulative Effective On-Grid Electricity for\nthe whole Year is less than the Normal Take, and Party A's Liability for Short \nGeneration is finalized pursuant to Article 4.6, Party A shall pay Party B \nwithin forty five (45) days after the end of the Year a compensation equal to \nthe portion of the shared costs for principal and interest repayment on the \nDedicated Transmission Facilities and for the Power Supply Costs, \n(after deduction of the transmission line loss and relevant taxes), \ncorresponding to Party A's Liability for Short Generation; the compensation to\nbe allocated to the provincial transmission facilities shall be exercised in \naccordance with the replies from relevant government authorities.\n\n\n8.3       In case of any of the following events, Party A or Party B shall pay \neach other the liquidated damages for late completion. Both Parties have \ncovenanted that the liquidated damages shall be on a reciprocal basis and shall \nbe equal in amount. If the insurance is covered, the insurance indemnity shall\nbe deducted.\n\n\n(1)      In the event that Party B fails to complete the construction of\n         Dedicated Transmission Facilities before the date provided for in\n         Article 2.4, which causes the failure of the Units to carry forth the\n         interconnected commissioning as scheduled, Party B shall, for each day\n         of delay, indemnify Party A the 'Loan Interest Payment Amount' as\n         stipulated in Article 8.3 (3) (a), and pay in advance for Party A the\n         'Loan Principal Repayment Amount' as stipulated in Article 8.3 (3) (b)\n         together with interest thereof;\n\n\n(2)      In the event that Party A fails to complete the construction of a Unit\n         in accordance with the schedule provided for in Article 2.2, which\n         causes a delay in the delivery of electricity to Party B (but not due\n         to the delay in the completion of Dedicated Transmission Facilities and\n         Provincial Transmission Facilities), Party A shall, for each day of\n         delay of Commercial Operation of such Unit, be liable to indemnify\n         Party B the 'Loan Interest Payment Amount' as stipulated in Article 8.3\n         (3) (a), and pay in advance for Party A the 'Loan Principal Repayment\n         Amount' as stipulated in Article 8.3 (3) (b) together with interest\n         thereof.\n\n\n(3)      Methods of calculation and payment of the liquidated damages:\n\n\n         a, The 'Loan Interest Payment Amount' shall mean the total amount of\n         interest payable for each day of delay on all the loans to such delayed\n         Unit;\n\n\n         b, The 'Loan Principal Repayment Amount' shall mean the total amount of\n         principal due and payable for each day of delay on all the loans to\n         such delayed Unit;\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n         c, The Loan Interest Payment Amount and the Loan Principal Repayment\n         Amount shall be established pursuant to the loan principal repayment\n         and interest payment component included in the On-Grid Tariff\n         corresponding to the Year of Commencement of Commercial Operation of\n         the Unit as estimated and submitted by Party A;\n\n\n         d, The indemnified Party shall repay in full the Loan Principal\n         Repayment Amount paid in advance to the defaulting Party at the latest\n         within one (1) year after the Date of Commencement of Commercial\n         Operation of Unit Six;\n\n\n         e, The liquidated damages provided for in this Article shall be paid on\n         a weekly basis on the first business day of the bank of each week\n         following the guaranteed completion dates as stipulated in Article 2.2\n         and Article 2.4, with the last such payment to occur on the actual\n         completion date.\n\n\n8.4       In the event that Party B fails to pay Party A the Electricity Fee in\naccordance with the schedule provided for in Article 7.3, Party B shall pay\nParty A the late payment fee calculated from the next day following the due day\nto the day on which the bank remits the fund. The late payment fee shall be\ncalculated at a rate of [***] per day on the delayed amount.\n\n\n                               Article 9 Insurance\n\n\n9.1       Party A shall purchase and maintain all types of insurance related \nwith the operation, maintenance and management of the Power Station. Annex 6 \ndetails the types of insurance required.\n\n\n                            Article 10 Force Majeure\n\n\n10.1     Definition of Force Majeure:\n\n\n         In this Contract an Force Majeure Event refers to any event which can\nnot be controlled, predicted, and the occurrence and consequences of which can\nnot be overcome by the affected Party to the Contract. Such events prevent the\naffected Party from performing its obligations under the Contract, or makes the\nperformance of such obligations impossible, such events including war, strike,\nflood, windstorm, fire, earthquake, thunderbolt, epidemic diseases, etc.\n\n\n10.2      The failure of a Party to fulfill any of its obligations hereunder \nshall not be considered to be a breach of, or default under this Contract and \nthe Party concerned shall not be liable to any liquidated damage insofar as such\ninability arises from an event of Force Majeure, provided that the Party\naffected by such an event has taken reasonable measures to mitigate effects of\nsuch event of Force Majeure, all with the objective of carrying out the terms\nand conditions of this Contract.\n\n\n10.3      Notification obligation\n\n\n(1)      The Party claiming Force Majeure shall give notice to the other Party\n         of any event of Force Majeure as soon as practical, but no later than\n         seven (7) days after the date on which such Party gets aware or should\n         have reasonably got aware of the commencement of such event, and shall\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n         provide the other Party with valid evidences of the Force Majeure event\n         within a reasonable period of time after cessation of such Force\n         Majeure event. Such evidences shall be issued by a notary organization\n         or relevant authority at the location of the Force Majeure event.\n         Notwithstanding the above, if the event of Force Majeure results in a\n         breakdown of communication rendering it not reasonably practicable to\n         give notice within the applicable time limit specified herein, then the\n         Party claiming Force Majeure shall give such notice as soon as\n         reasonably practicable after the reinstatement of the communications,\n         but no later than one day after such reinstatement .\n\n\n(2)      The Party claiming Force Majeure shall give notice to the other Party \n         of\n\n\n                  1.     event of Force Majeure;\n\n\n                  2.     the commencement and cessation time of the event of \n                  Force Majeure; and\n\n\n                  3.     the scope,  content and duration of the effects of such\n                  event of Force  Majeure on the  enjoyment  by such  affected \n                  Party of its rights or  performance  of its  obligations\n                  hereunder.\n\n\n10.4     Obligations to Mitigate the Damages\n\n\n         The Parties shall use all their reasonable efforts to mitigate the\neffects of any event of Force Majeure and to jointly develop and implement a\nplan of reasonable measures (in accordance with ownership of property) to remove\nthe effects of such event of Force Majeure. The Parties shall continue to\nperform other obligations as provided for in this Contract that are not affected\nby the event of Force Majeure.\n\n\n                              Article 11 Assignment\n\n\n11.1      Party B shall be entitled to transfer this Contract to a third Party,\nsubject to such third Party providing a financial guarantee stating that its\nfinancial status is at least as good as that of Party B and, subject also to the\napproval of Party A and its lenders. That third Party shall be the successor to\nall of Party B's rights and obligations under this contract.\n\n\n11.2      Party A shall obtain Party B's agreement to the assignment of its \nrights and obligations under this Contract to a third party other than the \nProject lenders.\n\n\n11.3      When Party A proposes to transfer the ownership of all the assets of \nthe Power Station at any time after the Unit 6 has been completed, Party B shall\nhave the first right of refusal as equally as the Project lenders do.\n\n\n11.4      Upon the assignment by any one Party of its rights and obligations \nunder this Contract, the transferor shall guarantee that the transferee shall\ncontinuously perform this Contract, and shall not impose \n\n\n\n\n\non the other Party any additional legal obligations or obligations beyond this\nContract. Such assignment shall be subject to the approval of the original\nexamination and approval authority.\n\n\n                     Article 12 Contract Term &amp; Termination\n\n\n12.1      The term of this Contract shall be twenty (20) years starting from the\ndate of issuance of business license to Party A. Should the Joint Venture Term\nof Party A be extended, both Party A and Party B may choose to:\n\n\n(1)      agree to extend the term of this Contract;\n\n\n(2)      negotiate new terms and conditions for this Contract.\n\n\n12.2      Should the purchase and sale of electricity be interrupted due to an \nevent of Force Majeure during the term of this Contract, either Party shall have\nthe right to extend the term of this Contract and the corresponding period for\nthe calculation of Normal Take pursuant to Article 1.9, with the terms and\nconditions of this Contract unchanged. The extension of the term of this\nContract shall be equal to the period that the purchase and sale of electricity\nwas interrupted due to the event of Force Majeure.\n\n\n12.3      In case of extension of this Contract pursuant to Article 12.1 and\nArticle 12.2, it shall be submitted to the original examination authority or\ncompetent examination authority for approval. No Party shall declare to\nterminate this Contract unilaterally.\n\n\n              Article 13 Governing Laws and Settlement of Disputes\n\n\n13.1      This Contract shall be governed and interpreted by the laws of \nPeople's Republic of China.\n\n\n13.2      Settlement of Dispute: Party A and Party B shall pursue the following\nprocedures in the event of any dispute between the Parties concerning the\nperformance of this Contract:\n\n\n(1)      Disputes shall be resolved through a conciliation and mediation\n         committee. Party A and Party B shall each recommend two mediators to\n         form a joint conciliation and mediation committee with the aim of\n         seeking resolution through friendly consultation. Within one month\n         after the dispute is submitted to the conciliation and mediation\n         committee, the conciliation and mediation committee shall provide a\n         resolution opinion to the Parties. Should either of the Parties not\n         accept the resolution proposal provided, the dispute shall be submitted\n         for arbitration in accordance with provisions of this Article.\n\n\n(2)      In the event that the dispute is not resolved in accordance with\n         Article 13.2 (1) above within sixty (60) days after any Party notifies\n         the other Party of the dispute in writing, either party may submit the\n         dispute in question to the China International Economic Trade\n         Arbitration Committee for arbitration in Beijing pursuant to the\n         arbitration rules prevailing at the time the application for\n         arbitration being filed. In the event that China International Economic\n         Trade arbitration Committee has no power of jurisdiction over such\n         dispute, the dispute shall be submitted to Beijing Municipal\n\n\n\n\n\n         Arbitration Committee for arbitration in Beijing pursuant to the\n         prevailing arbitration rules. The arbitration award from either of the\n         two said arbitration committees shall be final and binding upon the two\n         Parties.\n\n\n             Article 14 Effectiveness of the Contract and Amendments\n\n\n14.1      This Contract shall become effective upon approval by relevant state\nexamination and approval authorities to which Party B shall submit this Contract\nupon execution and seal by the validly authorised representative of the two\nParties.\n\n\n14.2      Changes in national and local laws and regulations shall not be \nregarded as a Force Majeure event. In the event of any change in national or\nlocal laws or regulations, this Contract shall be amended accordingly. Any\namendment of this Contract shall first have the unanimous agreement of Party A\nand Party B through consultation and be executed and sealed by the validly\nauthorised representatives of the two Parties and come into effect upon the\napproval of the original examination and approval authority.\n\n\n14.3      This Contract shall be written in Chinese and English, with both \nlanguage texts being equally authentic. In case of any conflict between the\nChinese and English versions, the Chinese version shall govern. This Contract\nshall have ten originals with Party A and Party B each keeping five. There shall\nbe twenty duplicates.\n\n\n\n\n\n\nParty A: Yangcheng International Power Generating Co. Ltd.\n\n\n\n\n\nRepresentative: [Signature Illegible]\n\n\nPosition:\n\n\n\n\n\n\n\n\nParty B: Jiangsu Provincial Power Company.\n\n\n\n\n\nRepresentative:  [Signature Illegible]\n\n\nPosition:\n\n\n\n\n\nVenue of Signing:   Beijing, the People's Republic of China\n\n\nDate:               January _____, 1997\n\n\n\n\n\n\n\n\n                                     Annex 1\n\n\n                            Power Station or Project\n\n\n         Yangcheng Power Station is located in Beiliu Township of Yangcheng\nCounty, Shanxi Province, 25 kilometres to the east of Jincheng City and 10\nkilometres to the west of Yangcheng city and just 0.4 kilometres to the south of\nBeiliu Township.\n\n\n         The natural elevation of the ground of the Power Station is 648-693 m.\n\n\n         The first phase of the Power Station is to build a 6x350MW anthracite\nfired Units with a total installed capacity of 2100 MW and, with room for\nfurther expansion. The turbine island and the boiler island of the main plant\nhouse of the Power Station are respectively imported from Siemens Company of\nGermany and the Foster Wheeler company of United States. The BOP portion of the\nPower Station is locally designed and uses local equipment (except for\npneumatic ash handling equipment and water supply pump station equipment),\nincluding mainly coal conveying, oil supply, ash disposal, water supply,\nrecycling water, chemical water, electrical step-up substation, start-up power\nsource, parasitic load, communication, repair, monitoring and other auxiliary\nproduction facilities.\n\n\n         Offsite project mainly includes the following: water source, make-up\nwater pump and pipelines, ash handling and ash water recovery pipelines, ash\nyard, Dedicated railway, coal transporting and access road to the Power Station,\nstart-up power source transmission and transformation facilities, residential\nquarters (external to the Power Station) in Jincheng city, administrative area\nin the front part of the Power Station and offsite communication and remote\ncontrol system, etc.\n\n\n         For the Property Right Boundary Line of the Power Station and the 500KV\ntransmission facilities, see Annex 2.\n\n\n\n\n\n\n\n                                     Annex 2\n\n\n                        Dedicated Transmission Facilities\n\n\n         The electricity produced by the Power Station shall be totally\ntransmitted to Jiangsu Province in the form of Dedicated station, Dedicated\nlines and Dedicated supply. The Dedicated Transmission Facilities in association\nwith the Power Station shall start from the Property Right Boundary Point and\npass through the provinces of Shanxi, Henan, Shandong and Anhui to Huaiyin of\nJiangsu Province (a distance of about 755 kilometers). Details of the whole\ntransmission line project of the Power Station are as follows:\n\n\n1.        Two switching stations to be newly constructed: the mid-way switching\nstation (for three incoming lines and two outgoing lines, total five circuits)\nat the crossing point of the Yellow River and the Sanbao Switching Station, at\nXuzhou city of Jiangsu province (with two incoming lines and three outgoing\nlines, total five circuits);\n\n\n2.        A substation to be expanded in Huaiyin, Jiangsu Province with one 750\nMVA main transformer;\n\n\n3.        The extension for one 500 kV panel at the Runzhuang Substation in \nJiangsu Province.\n\n\n4.        Three circuits from the Power Station to the mid-way switching\nstation to be constructed, approximately 3 x 262 km long on one double circuit\ntower and one single circuit tower;\n\n\n          Two circuits from the newly constructed mid-way switching station to\nSanbao Switching Station to be constructed, 2 x 268 km long on a double circuit\ntower, with serial compensation equipment of 2 x 500 MVAR;\n\n\n          One single circuit from the newly constructed Sanbao Switching Station\nto Runzhang Substation, 50 km long single circuit;\n\n\n          Two circuits on a double circuit tower from the newly constructed\nSanbao Switching Station to Huanyin Substation, 2 x 230 km long on a double\ncircuit tower;\n\n\n          One crossing over the Yellow River with a circuit length of 2 x 4 km;\n\n\n5.        Associated parallel resistors, reactive power compensation equipment\nand corresponding remote control, communication and protective relay equipment\nto be built;\n\n\n          Drawing No. 0-1 shows the one-line diagram of the Transmission \nFacilities.\n\n\n          Drawing No. 0-2 shows the one-line diagram of the stations and \nsubstations.\n\n\n          Drawing No 0-3 shows the Property Right Boundary Point between the\nPower Station and Transmission Facilities.\n\n\n\n\n                                [GRAPHIC OMITTED]\n\nPoint A to the direction of the transmission line falls within the scope of \nconstruction of the dedicated transmission facilities including the terminal\ntower, while the others fall within the scope of the Power Station.\n\n\n\n\n\n                                     Annex 3\n\n\n              Performance Indices and Testing Results for the Units\n\n\n\n\n\nRelevant performance test items, indices and test results of the Units are shown\nas follows:\n\n\n<font size=\"2\">\n\n------ ------------------------------------------------------- ------------------- -----------------------\n\n       Performance Test items                                  Design Value        Actual Test Value\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n                                                                         \n\n1      maximum continuous output of the Unit (MW)              369.6\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n2      rated capacity (MW) of the Unit                         350\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n3      minimum non-oil stable burning load (MCR) of the Unit   50%\n\n\n       non-oil stable burning Load (ECR) of the Unit           --\n\n\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n4      load adjustment rate of the Unit                        5% \/MIN\n\n\n                              50%~100%MCR\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n                              below 50% MCR                    3% \/MIN\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n5      Parasitic loan of the Unit under ECR working condition  less than or equal\n                                                               to 6%\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n6      rated  power  factor  of the Unit  under  ECR  working  0.85\n       condition\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n7      coal  consumption  (kilogram \/ KWH)  of the  Unit in    330\n       power generation\n------ ------------------------------------------------------- ------------------- -----------------------\n------ ------------------------------------------------------- ------------------- -----------------------\n\n8      Unit supply capacity (MW):\n\n\n       Rated power factor of the Unit x (1 - parasitic load\n       of the Unit under ECR working conditions) - main \n       transformer and busbar power loss\n------ ------------------------------------------------------- ------------------- -----------------------\n\n<\/font>\n\n\n\n\n\n\n                                     Annex 4\n\n\n       Returns on Registered Capital (Anticipated Revenue) Over the Years\n\n\n\nUnit: ten thousand US Dollars\n\n\n<font size=\"2\">Year       Registered Capital Contributions       Returns on Registered Capital\n\n\n 1                     [***]                                    [***]\n 2                     [***]                                    [***]\n 3                     [***]                                    [***]\n 4                     [***]                                    [***]\n 5                     [***]                                    [***]\n 6                     [***]                                    [***]\n 7                     [***]                                    [***]\n 8                     [***]                                    [***]\n 9                     [***]                                    [***]\n10                     [***]                                    [***]\n11                     [***]                                    [***]\n12                     [***]                                    [***]\n13                     [***]                                    [***]\n14                     [***]                                    [***]\n15                     [***]                                    [***]\n16                     [***]                                    [***]\n17                     [***]                                    [***]\n17                     [***]                                    [***]\n18                     [***]                                    [***]\n19                     [***]                                    [***]\n20                     [***]                                    [***]\n\nNote:\n\n\n<\/font>(1) The financial internal rate of return (FIRR) on the above Registered Capital\ncontribution and Returns on Registered Capital shall be [***] on the\nbasis of the Normal Take. If the amount and timing of Registered Capital\nactually contributed are different from the figures listed in the above table,\nthe returns on Registered Capital shall be adjusted, while the financial\ninternal rate of return remains at [***].\n\n\n(2) The Returns on Registered Capital (Anticipated Revenue) in the table are\napplicable to the formula in the calculation of On-Grid Tariff set forth in\nArticle 5.4.\n\n\n\n[***] Filed separately with the Commission pursuant to a request for\nconfidential treatment.\n\n\n\n\n                                     Annex 5\n\n\n              Method of Account Settlement for the Amount of Power\n                         Generated by the Power Station\n\n\n\nArticle 1. Account settlement for monthly generated amount of power which\ndeviates from the plan.\n\n\na.       the monthly generation plan (including amendments) as issued by the\n         State Despatch Centre shall prevail.\n\n\nb.       Factors leading to the revision of the monthly generation plan are as \n         follows:\n\n\n1.       Factors regarding the variation of the planned maintenance schedule of\n         the generating units shall be based on the monthly planned maintenance\n         schedule as issued by the State Despatch Centre, any change in the\n         maintenance schedule shall be submitted to the State Despatch Centre\n         for approval and the monthly generation plan shall be adjusted as\n         determined by the State Despatch Center.\n\n\n2.       The amount of power  generated  which is affected by the outage of  \n         generating units as required by the grid shall be adjusted.\n\n\n3.       Other adjustment factors: reduced power generation resulting from \n         the  disconnection of the Power Station or failure to generate the \n         expected amount of electricity which is caused by transmission line\n         breakdown not attributable to the Power Station.\n\n\nc.      In the event of any accident in any month in the generating units of the\nPower Station or any maintenance of electrical equipment (including emergency\nmaintenance and maintenance extension without the approval of the State Despatch\nCentre) which is not included in the monthly generation plan and which affects\npower generation, it shall be recorded as monthly unplanned outage hours of the\nPower station.\n\n\n         Monthly Unplanned outage Hours = (SIGMA) (Unit accident outage hours +\n         Unit interim maintenance outage hours + Unit planned maintenance\n         extended outage hours).\n\n\n         The Monthly Unplanned Outage Hours shall be added up cumulatively month\nby month, if the Annual Actual Equivalent Despatchable Hours of the Power\nStation fail to reach the requirement as stipulated in Article 4.5 herein, so\nthat the annual cumulative Effective On-Grid Electricity in such Year fails to\nreach the annual Normal Take, then Party A shall compensate Party B pursuant to\nArticle 8.2 herein.\n\n\nd.       If the Power Station finds it difficult to execute the verified peaking\nquota, it shall submit a written application to the State Despatch Centre and\nshall solicit consent from Party B so that the State Despatch Centre can make\nnecessary arrangement in the monthly and daily generation plans, but the Power\nStation \n\n\n\n\n\nshall pay to the Jiangsu Power Grid a peaking compensation fee of RMB\n5,000 Yuan for less generation of 10 MW each day during the valley period.\n\n\nArticle 2. The daily generation despatch curve (including amendment) issued by\nthe State Despatch Centre is the basis for the amount of electricity generated\nby the Power Station and accounts settlement for the amount of electricity\ngenerated. The State Despatch Centre may revise, after having consulted with\nParty B, the daily generation despatch curve of Yangcheng Power Station in the\nlight of the following different conditions:\n\n\n1.       the requirement for frequency modulation, peaking and planned power  \nallocation on the part of the Jiangsu Power Grid.\n\n\n2.       the communication line between the Jiangsu Power Grid and other \nprovincial grids is not capable of taking the expected power load, nor is the \nout-going line of Yangcheng Power Station.\n\n\n<font size=\"2\">3.       temporary maintenance of approved equipment during valley load and \nmid-range load periods.\n\n\n4.       temporary maintenance of approved generation units (including \nauxiliaries).\n\n\n5.       accident outage of the Power Station\n\n\n6.       extension of the approved planned maintenance of the generating units.\n\n\n7.       in the event of force majeure.\n\n\n8.       other causes acknowledged by the State Despatch Centre.\n\n\n<\/font>Article 3. Economic settlement of daily output rate and amount of electricity\nwhich deviates from the plan.\n\n\na.       the planned daily  generation  despatch curve (including  amendments)\nissued by the State Despatch Centre shall govern the planned daily generation \nof the Power Station.\n\n\nb.       The active power output rate of the Power Station shall be sampled at\nan interval of every 15 minutes, totaling 96 sampling points per day, an error\nexceeding +\/- 3% shall be recorded as an unqualified point if compared with the\ncorresponding planned value (when the values recorded during the two hours\nprior to and after the planned value are different, then the quartering of the\ndifferential value shall be taken and be progressively increased to or decreased\nfrom the hour values).\n\n\nc.       The unqualified points for the active power output of the Power Station\nshall  be  settled economically in accordance with the following standards:\n\n\n1.       if the number of unqualified points is less than the number of monthly\n         examination points by 5%, the Jiangsu Power Grid shall pay the Power\n         Station a bonus at the rate of RMB 600 per bonus point.\n\n\n\n\n\n         Bonus points = monthly examination points x 5% - unqualified points.\n\n\n2.       if the unqualified points exceed the examination points by 5-10% \n         inclusive,  the Power Station shall compensate the Jiangsu Power Grid\n         at the rate of RMB 100 per unqualified point.\n\n\n3.       if the  unqualified  points exceed the  examination  points by 10-20% \n         inclusive, the Power Station shall compensate Jiangsu Power Grid at the\n         rate of RMB 200 per unqualified point.\n\n\n4.       if the unqualified points exceed the examination points by over 20%,\n         the Power Station shall compensate the Jiangsu Power Grid at the rate\n         of RMB 400 per unqualified point.\n\n\nd.       The actual generation of the Power Station shall be sampled at an\ninterval of five minutes, totaling 288 sampling points per day, the error\nexceeding +\/- 3% shall be regarded as a deviation from the daily generation plan\nwhich shall be settled economically in accordance with the following standards:\n\n\n1.       If the error is within +\/-3%, the excess and deficit generation may be\n         offset in the corresponding periods that day; if there is still excess\n         generation after offsetting excess and deficit generation in the valley\n         and mid-range periods, the electric energy is not counted and the\n         Electricity Fees are not paid; if there is still deficit generation\n         after offsetting in the peak period, the Power Station shall compensate\n         Jiangsu Power Grid in accordance with the mutually allocating tariff\n         for the peak period between provincial grids of the East China Power\n         Grid.\n\n\n2.       If the excess generation deviates from the plan by more than +3% in the\n         valley period, in addition to not counting the electric energy and not\n         paying the Electricity Fees, the Power Station shall compensate the\n         Jiangsu Power Grid in accordance with the tariff which is 150% as much\n         as the mutually allocating tariff for the valley period between\n         provincial grids of the East China Power Grid.\n\n\n3.       if the excess generation deviates from the plan by more than +3% in the\n         mid-range period, in addition to not counting the electric energy and\n         not paying the Electricity Fees, the Power Station shall compensate the\n         Jiangsu Power Grid 100% as much in accordance with the mutually\n         allocating tariff for the mid-range period between provincial grids of\n         the East China Electric Power Grid.\n\n\n4.       If the short generation deviates from the plan by more than -3% in the\n         peak period, the Power Station shall compensate the Jiangsu Power Grid\n         in accordance with the tariff which is 200% as much as the\n         mutually-allocating tariff for the peak period between provincial grids\n         of the East China Power Grid.\n\n\nArticle 4. The division of generation periods\n\n\na.       It is only divided into the peak period and the valley period from 1st\nJuly to 30th September each year.\n\n\n\n\n\n         where,\n\n\n         the peak period : 0800 - 2200 hours\n\n\n         the valley period : 2200 - 0800 of the following day\n\n\nb.       It is divided into the peak period, the mid-range period and the valley\nperiod from 1st January to 30th June and from 1st October to 31st December.\n\n\n         where,\n\n\n         the peak period : 0800 - 1100 hour and 1700 - 2200 hour\n\n\n         the mid-range period : 1100 - 1700 hour\n\n\n         the valley period : 2200 - 0800 of the following day\n\n\nArticle 5. The document published by the East China Power Administration shall\nbe taken as the standard for the inter-provincial mutually-allocating power\nprice of East China Power Grid for the peak load, the mid-range load and the\nvalley load periods.\n\n\nArticle 6. Prior to 25th of each month, Jiangsu Provincial Power Company shall\ndeliver to the Power Station the Bill of Account Settlement on Power Generation\nof the Power Station in the preceding month and shall settle the accounts when\nit pays the On-Grid Electricity Fees to the Power Station before the end of the\nmonth in accordance with this Method and the Power Purchase Contract entered\ninto by and between the Yangcheng International Power Generating Company and the\nJiangsu Provincial Power Company.\n\n\nArticle 7. If the change in the method of check out in the East China Power Grid\nleads to modifying the method for economic settlement of dispatching power\ngeneration of the Power Station by the Jiangsu Provincial Power Company, this\nmethod shall be correspondingly revised.\n\n\n\n\n\n\n                                     Annex 6\n\n\n                                    Insurance\n\n\n         Party A shall purchase or cause to be purchased the following insurance\nfor each Unit and shall maintain the insurance at full effectiveness from the\ncommencement of Commercial Operation of Unit 1 until the expiration of the Joint\nVenture Term:\n\n\n1.       Property All risks insurance:\n\n\n         Scope of Coverage:         tangible losses or damages to buildings, \n         machinery, inventories, fixed installation, spare parts and all other\n         personal properties which are structured together to form the Power\n         Station, including but not being limited to the losses or damages\n         resulting from the risks listed below: fire, lightning, explosion,\n         self-ignition, thunderstorm, snow-storm, flooding, typhoon, damage by\n         water, riot, strikes, willful damage, earthquakes, tsunamis, collapse\n         and\/or the loss of stored goods in storage tanks.\n\n\n         Insured Amount:            the full value for a repurchase of the \n                                    insured items.\n\n\n2.       Insurance for outage due to breakdown of machinery\n\n\n         Scope of Coverage:         sudden and unforeseen tangible losses or \n                                    damages to all machinery, plant house,\n                                    boilers, ancillary equipment which are\n                                    structured to form the Power Station due to\n                                    the following causes, including but not\n                                    being limited to breakdown of machinery and\n                                    electrical equipment, collapse and explosion\n                                    of boiler and pressurized vessel, electrical\n                                    short-circuit, improper vibration and\n                                    calibration, overloading and over-voltage,\n                                    abnormal tension, centrifugal force,\n                                    breakdown in protection and regulation\n                                    equipment, overheating or collision or other\n                                    similar causes.\n\n\n         Insured Amount:            The value for the repurchase of the insured\n                                    machines, station houses, boilers and\n                                    others.\n\n\n3.       Third Party Liability Insurance\n\n\n         Scope of Coverage:         property losses or personnel casualties  \n                                    to third parties that Party A is required to\n                                    be liable legally in the business operation\n                                    and maintenance of the Power Station by the\n                                    JV Company.\n\n\n         Insured amount:            The maximum insurance amount for each \n                                    accident is RMB 200,000 Yuan. The number of\n                                    accidents insured is not limited.\n\n\n         Insured Person:   The Joint Venture Company\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":[9613,9619],"class_list":["post-42679","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__sales"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42679","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=42679"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42679"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42679"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42679"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}