Common use of Operating Fee Clause in Contracts

Operating Fee. For purposes of calculating the initial annual operating fee payment under 30 CFR 585.506, BOEM applies an operating fee rate to a proxy for the wholesale market value of the electricity expected to be generated from the project during its first 12 months of operations. This initial payment would be prorated to reflect the period between the commencement of commercial operations and the Lease Anniversary. The initial annual operating fee payment would be due within 45 days after commencement of commercial operations. Thereafter, subsequent annual operating fee payments would be due on or before the Lease Anniversary. The subsequent annual operating fee payments are calculated by multiplying the operating fee rate by the imputed wholesale market value of the projected annual electric power production. For the purposes of this calculation, the imputed market value would be the product of the project’s annual nameplate capacity, the total number of hours in the year (8,760), the capacity factor, and the annual average price of electricity derived from a regional wholesale power price index. For example, the annual operating fee for a 976-megawatt (MW) wind facility operating at a 40 percent capacity (i.e., capacity factor of 0.4) with a regional wholesale power price of $40 per megawatt hour (MWh) and an operating fee rate of 0.02 will be calculated as follows: hrs $40 Annual Operating Fee = 976 MW × 8,760 year × 0.4 × MWh Power Price × 0.02 = $2,736,820.22

Operating Fee. For purposes of calculating the initial annual operating fee payment under 30 CFR 585.506, BOEM applies an operating fee rate to a proxy for the wholesale market value of the electricity expected to be generated from the project during its first 12 months of operations. This initial payment would will be prorated to reflect the period between the commencement of commercial operations and the Lease Anniversary. The initial annual operating fee payment would will be due within 45 90 calendar days after of the commencement of commercial operations. Thereafter, subsequent annual operating fee payments would will be due on or before the Lease Anniversary. The subsequent annual operating fee payments are will be calculated by multiplying the operating fee rate by the imputed wholesale market value of the projected annual electric power production. For the purposes of this calculation, the imputed market value would will be the product of the project’s annual nameplate capacity, the total number of hours in the a year (8,760), the capacity factor, and the annual average price of electricity derived from a regional wholesale power price index. For example, the annual operating fee for a 976-976 megawatt (MW) wind facility operating at a 40 percent capacity (i.e., capacity factor of 0.4) with a regional wholesale power price of $40 per megawatt hour (MWh) and an operating fee rate of 0.02 will would be calculated as follows: hrs $40 Annual Operating Fee = 976 MW × 8,760 year 8,760year × 0.4 × MWh Power Price × 0.02 = $2,736,820.222,735,923.20

Operating Fee. For purposes of calculating the initial annual operating fee payment under pursuant to 30 CFR 585.506, BOEM applies an operating fee rate to a proxy for the wholesale market value of the electricity expected to be generated from the project during its first 12 months of operations. This initial payment would will be prorated to reflect the period between the commencement of commercial operations and the Lease Anniversary. The initial annual operating fee payment would be is due within 45 days after of the commencement of commercial operations. Thereafter, subsequent annual operating fee payments would be are due on or before the Lease Anniversary. The subsequent annual operating fee payments are calculated by multiplying the operating fee rate by the imputed wholesale market value of the projected annual electric power production. For the purposes of this calculation, the imputed market value would be the product of the project’s annual nameplate capacity, the total number of hours in the year (8,760), the capacity factor, and the annual average price of electricity derived from a regional wholesale power price index. For example, the annual operating fee for a 9761,028-megawatt (MW) wind facility operating at a 40 percent 40% capacity (i.e., capacity factor of 0.4) with a an annual average regional wholesale power price of $40 per 40/megawatt hour (MWh) and an operating fee rate of 0.02 will be calculated as follows: hrs $40 hrs Annual Operating Fee = 976 1,028 MW × 8,760 year × 0.4 × MWh Power Price × 0.02 = $2,736,820.222,881,689.60 year MWh

Operating Fee. For purposes of calculating the initial annual operating fee payment under 30 CFR 585.506, BOEM applies would apply an operating fee rate to a proxy for the wholesale market value of the electricity expected to be generated from the project during its first 12 months of operations. This initial payment would be prorated to reflect the period between the commencement of commercial operations and the Lease Anniversary. The initial annual operating fee payment would be due within 45 days after of the commencement of commercial operations. Thereafter, subsequent annual operating fee payments would be due on or before the Lease Anniversary. The subsequent annual operating fee payments are would be calculated by multiplying the operating fee rate by the imputed wholesale market value of the projected annual electric power production. For the purposes of this calculation, the imputed market value would be the product of the project’s annual nameplate capacity, the total number of hours in the year (8,760), the capacity factor, and the annual average price of electricity derived from a regional wholesale power price index. For example, the annual operating fee for a 976-976 megawatt (MW) wind facility operating at a 40 percent capacity (i.e., capacity factor of 0.4) with a regional wholesale power price of $40 per megawatt hour (MWh) and an operating fee rate of 0.02 will would be calculated as follows: hrs $40 Annual Operating Fee = 976 MW × 8,760 year × 0.4 × MWh Power Price × 0.02 = $2,736,820.22

Operating Fee. For purposes of calculating the initial annual operating fee payment under pursuant to 30 CFR 585.506, BOEM applies an operating fee rate to a proxy for the wholesale market value of the electricity expected to be generated from the project during its first 12 months of operations. This initial payment would will be prorated to reflect the period between the commencement of commercial operations and the Lease Anniversary. The initial annual operating fee payment would be is due within 45 days after of the commencement of commercial operations. Thereafter, subsequent annual operating fee payments would be are due on or before the Lease Anniversary. The subsequent annual operating fee payments are calculated by multiplying the operating fee rate by the imputed wholesale market value of the projected annual electric power production. For the purposes of this calculation, the imputed market value would be the product of the project’s annual nameplate capacity, the total number of hours in the year (8,760), the capacity factor, and the annual average price of electricity derived from a regional wholesale power price index. For example, the annual operating fee for a 9761,028-megawatt (MW) wind facility operating at a 40 percent capacity (i.e., capacity factor of 0.4) with a an annual average regional wholesale power price of $40 per 40/megawatt hour (MWh) and an operating fee rate of 0.02 will be calculated as follows: hrs $40 hrs Annual Operating Fee = 976 1,028 MW × 8,760 year × 0.4 × MWh Power Price × 0.02 = $2,736,820.222,881,689.60 year MWh