Common use of Project Execution Clause in Contracts

Project Execution. (a) WMECO’s cost for implementing an individual project will comply with an Actual Cost Threshold (“ACT”). (b) The ACT will be equal to the FCE plus an allowable contingency range of up to 10%. For example, if the FCE for a facility is $6,500/kW, the ACT will equal $7,150/kW ($6,500 plus 10%). Costs in excess of the ACT are recoverable, subject to approval by the Department, but shall not include a return on equity. (c) In the event that actual costs exceed the ACT, WMECO shall notify the Stipulating Parties and the Department within 45 days of discovery that a cost overrun has occurred, together with a narrative explanation of the reason for the overrun and appropriate documentation. (d) Upon receiving notification from WMECO and the narrative explanation, a signatory to this Agreement may request a technical session and/or a proceeding and evidentiary hearing to review the circumstances before the Department.