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Exhibit 10.3
CERTAIN PORTIONS OF THIS AGREEMENT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THE OMITTED PORTIONS, WHICH ARE IDENTIFIED BY THE SYMBOL
"XXXX", HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
AMENDMENT NO. 1 TO
SUPPLEMENT GENERATION AGREEMENT
This Amendment No. 1 ("Amendment") to the Supplemental Generation
Agreement ("Supplemental Generation Agreement") dated December 21, 2000, is made
and entered into effective the 1st day of June, 2001 (the "Effective Date") by
and between GENEVA STEEL L.L.C., a Delaware limited liability company
("Geneva"), the successor in interest to Geneva Steel Company, and Utah Power &
Light Company, an assumed business name of PACIFICORP, an Oregon corporation
("Utah Power").
RECITALS
A. On February 10, 1989, Utah Power and Geneva entered into an agreement
("the 1989 Agreement"), as amended, by which Utah Power supplies
interruptible power and energy to Geneva's steel production facility in
Vineyard, Utah.
B. On July 1, 1997, Utah Power and Geneva entered into the Generation
Cooperation Agreement (the "Cooperation Agreement") by which Utah Power
may call on Geneva to increase the output of its steam electric
generating plant (the "Generating Plant") at its steel production
facility up to 1,314 hour per contract year as an offset to Geneva's
demand for electric service under the 1989 Agreement.
C. On December 21, 2000, Geneva and Utah Power entered into the
Supplemental Generation Agreement pursuant to which Utah Power agreed
to compensate Geneva for certain Supplemental Generation that Geneva
offered to generate.
D. On June 8, 2001, Geneva and Utah Power entered into a Load Curtailment
Agreement ("Load Curtailment Agreement") pursuant to which Geneva
agreed to curtail load and Utah Power agreed to compensate Geneva for
such curtailment during certain peak hours.
E. The parties now desire to amend the Supplemental Generation Agreement
to require Geneva to use reasonable commercial efforts to generate, and
to require Utah Power to purchase Supplemental Generation made
available by Geneva, outside of the peak hours covered by the Load
Curtailment Agreement.
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NOW, THEREFORE, in consideration of the mutual promises contained herein, the
Parties agree as follows:
1. Section 1.1 of the Supplemental Generation Agreement is amended and
replaced in its entirety to read as follows:
1.1 "Baseline Generation Capability" means 25.2 MWh per hour when
operating one blast furnace and 38.6 MWh per hour when
operating two (2) blast furnaces.
2. Sections 1.2 and 1.6 of the Supplemental Generation Agreement are
deleted in their entireties.
3. Section 1.9 of the Supplemental Generation Agreement is amended and
replaced in its entirety to read as follows:
1.9 "Supplemental Generation" means the hourly generation amounts
provided by the Generating Plant during hours other than Load
Curtailment Periods covered by the Curtailment Agreement, and
other than amounts called upon by Utah Power to offset
Geneva's power purchases in accordance with the Cooperation
Agreement. The maximum hourly amount that PacifiCorp may call
upon under the Cooperation Agreement is 10 MWh per hour.
4. Section 2 of the Supplemental Generation Agreement is amended and
replaced in its entirety to read as follows:
2. Term.
The term of this Agreement shall be coterminous with the term
of the Load Curtailment Agreement.
5. Section 3.1 of the Supplemental Generation Agreement is amended and
replaced in its entirety to read as follows:
3.1 Payment for Supplemental Generation. During the term of this
Agreement, Utah Power shall pay Geneva for the value of all
Supplemental Generation provided by Geneva at the Delivery
Point.
6. Section 3.3 of the Supplemental Generation Agreement is amended and
replaced in its entirety to read as follows:
3.3 Scheduling. Geneva shall notify Utah Power's Dispatch Center
prior to 1000 hours Prevailing Mountain Time on the last
mutually recognized work day prior to the following week
(normally Friday) of the days and hours that Geneva expects
that Supplemental Generation will not be
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available during the following Saturday through Friday period.
No later that 1300 hours on the date that Utah Power timely
receives the foregoing information from Geneva, Utah Power
shall pre-schedule the day(s) during the upcoming week that
Geneva has offered to provide Supplemental Generation. Utah
Power shall provide a schedule for both High Load Hours and
Low Load Hours and shall indicate when it is calling for
Supplemental Generation Capability under this Agreement and
when it is calling for offsets under the Cooperation
Agreement.
7. Section 3.4 is deleted in its entirety
8. Section 4.1 of the Supplemental Generation Agreement is amended and
replaced in its entirety to read as follows:
4.1 For Supplemental Generation provided by Geneva during On-Peak
Hours, Utah Power shall pay Geneva XXXX of the Dow Xxxxx Palo
Verde Firm Index multiplied by the difference between the
generated amount for that hour and the Baseline Generation
Capability. For Supplemental Generation provided by Geneva
during Off-Peak Hours and Sundays and WSCC Holiday Hours, Utah
Power shall pay Geneva XXXX of the Dow Xxxxx Palo Verde Firm
Index for the relevant period, multiplied by the difference
between the generated amount for that hour and the Baseline
Generation Capability. For purposes of calculating payments to
Geneva under this Agreement, the applicable index shall never
be less that $32/Mwh. The Baseline Generation Capability may
be modified to accommodate changed circumstances for specified
periods of time, upon agreement of both parties. Any such
modifications shall not be enforceable without written
confirmation (by facsimile or otherwise) from Utah Power
confirming any agreed-upon modifications and the periods
during which the same shall apply.
9. Section 4.2 is revised to read as follows:
4.2 Billing
PacifiCorp shall credit Geneva's invoice with amounts as
provided herein on a monthly basis. PacifiCorp shall be able
to offset any payments it owes Geneva hereunder with any
amounts Geneva owes PacifiCorp pursuant to the 1989 Agreement
or any other Geneva/PacifiCorp Agreements. If the credit
amount owed to Geneva exceeds the monthly payment due
PacifiCorp for power purchased by Geneva under the 1989
Agreement, PacifiCorp shall pay the net amount due Geneva
hereunder within seventeen days after the end of each billing
month. PacifiCorp shall electronically wire transfer its
monthly payment to an account designated by Geneva. All hours
in which Geneva provides Supplemental Generation
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energy by this agreement shall be accounted for separately
from the 1,314 hours provided under the Cooperation Agreement.
10. Other than as specifically modified herein, the Generation Agreement
shall remain in full force and effect.
UTAH POWER GENEVA STEEL L.L.C.
By: /s/ Xxxx XxxXxxxxxx By: /s/ Xxx X. Xxxxxxx
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Its: Executive Vice President Its: President
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