Terms of the Settlement Agreement

The Settlement Agreement addresses four issues to resolve all disputes among the parties: (1) the applicability of the approved KRCC Contract to other QF parties; (2) conduct by SCE for future negotiations with affiliate QF projects; (3) the allocation of any above-market costs associated with the KRCC Contract to SCE's ongoing CTC revenue requirement; and (4) agreement by the Settling Parties that the Commission should expeditiously approve the KRCC Contract.

The Settlement Agreement obligates SCE to engage in good faith negotiations with respect to five-year firm capacity power sales contracts with Eligible QF Parties. The Settlement Agreement defines the time limits for negotiations, provides for monetary sanctions for not negotiating in good faith, addresses procedures for future negotiations between SCE and its affiliates, and expresses the intent of the Settling Parties that the Commission should approve this Settlement Agreement using an expedited schedule.