Climate Challenge Participation Letter

DOE's Energy Partnerships for a Strong Economy

I. Utility Commitments

A.
Consistent with paragraph II.B.1a & f of the Climate Challenge Program MOU,
AEI will:
Undertake specific projects or actions, or make specific expenditures on projects or actions, to reduce net greenhouse gas (GHG) emissions by year 2000; and make a specified contribution to a particular industry initiative.

In order to achieve the commitments, AEI will:

1. Implement the Demand Side Management Resource Plan for 1995-2000
2. Implement the Peach Bottom Plant Update Program
3. Develop cogeneration projects
4. Develop district cooling & heating projects
5. Support the National Earth Comfort Program
6. Continue to explore and research opportunities in both its supply and demand side activities that will reduce greenhouse gas emissions in a cost-effective way.

Specific emission reduction targets for these programs appear in Attachment B.

B.
AEI will report annually on activities and achievements under the Climate Challenge Program. Results achieved during each year shall be reported in a clear and understandable manner that is consistent with the guidelines adopted pursuant to Subsection 1605(b) Energy Policy Act and the Climate Challenge accounting protocols in Exhibit B of the Climate Challenge Program MOU. The first such report may include a description of the activities and achievements of AEI prior to its becoming a participant in the Program, expressed on an annual basis to the extent possible.

C.

AEI will confer with DOE on or before November 15, 1996 to evaluate jointly the progress of AEI in achieving its Climate Challenge Program goals and to discuss possible adjustments to its voluntary commitments.

D.

The Climate Challenge Program representative for AEI will be:

Mr. AIfonso Gandica, Coordinator
Environmental Affairs Department - MLC
Atlantic Electric
6801 Black Horse Pike
Pleasantville, NJ 08232

AEI agrees to notify DOE prior to, or in any event, no later than 30 days after any change in the contact.

A.
DOE's commitments to AEI are those set out in Section III of the Climate Challenge Program MOU, which are hereby incorporated in this Participation Accord by reference.
B.
DOE will consider AEI`s requests to intervene in regulatory proceedings of federal, state and local commissions and boards on issues pertinent to the Climate Challenge Program. Before DOE intervenes in regulatory and other proceedings pertaining to AEI for purposes of addressing Climate Challenge Program issues, it will provide notice to AEI.

C.

DOE will provide an annual report to AEI describing the actions that it has taken to fulfill its commitments under Section III and Exhibit C of the Climate Challenge Program MOU and the results of those actions.

D.

The Climate Challenge Program representative for DOE, who will serve as liaison to AEI, will be:

Mr. Allan Hoffman
U. S. Department of Energy
Room 6B-l28 (EE-10)
Washington, DC 20585
Telephone: (202) 586-1786

DOE agrees to notify AEI prior to, or in any event, no later than 30 days after any change in liaison responsibilities or personnel.

A.
Use of DOE-developed materials by AEI will be governed by the provisions of Section IV of the Climate Challenge Program MOU, which are hereby incorporated in this Participation Accord by reference.

B.
In addition to the foregoing provisions, DOE and AEI agree to act in accordance with the principles set out in Section I of the Climate Challenge Program MOU and the general provisions set out in Subsections VA.-V.D., V.F. and V.G. of the Climate Challenge Program MOU, which are hereby incorporated by reference.

C.

Either party may withdraw from this Participation Accord or any of its activities under the Climate Challenge Program without penalty and without being subject to remedies at law or equity.

            (Original Signed By)                  (Original Signed By)

            Jerrold L. Jacobs                     Hazel R. O'Leary

            President & CEO                       Secretary

            Atlantic Electric                     U.S. Department of Energy



            Date:                                 Date: 

cc: Attachments

(Attachment A - Climate Challenge Program MOU and exhibits)
(Attachment B - AEI's Emission Reductions from specific programs)

AEI commits to the implementation of its Demand Side Management Resource Plan from 1995-2000 through its subsidiary Atlantic Electric. This plan represents an emission reduction of about 174,301 tons of CO₂ through the year 2OOO with about 15% due to the use of ground-source heat pumps. From 1991 through 1994 the estimated emission reduction is about 37,827 tons of CO₂ of which about 20% are from ground-source heat pumps. The estimated annual reduction by the year 2000 is 24,573 tons of CO₂. Examples of the programs in this plan are ground-source heat pumps, cool storage, weatheriztion, high efficiency new construction, efficient street lights and direct load control.

2.

AEI commits to its portion of the Peach Bottom Nuclear Plant Update Program to be completed in 1993 through its subsidiary Atlantic Electric. This program represents an emission reduction of about 304,400 tons of CO₂ due to displacement of coal generation through the year 2000. The annual emission reduction is about 55,346 tons of CO₂.

3.

AEI commits to the continuation of three cogeneration projects through its subsidiary Atlantic Generation Inc. (AGI) as follows:

                                                             Startup

                                           Capacity            Year



      a     Pedricktown (PCLP)             117.0 MW            1992

      b.    Binghamton (BCLP)                50.0MW            1992

      c.    Vineland   (VCLP)                46.5MW            1994

                                      Total 213.3MW

Atlantic Generation, Inc. (AGI), one of AEI's subsidiaries, owns 50% of these cogeneration projects. The AEI portion of the emission reduction associated with these projects is about 1,302,322 tons of CO₂ due to the use of natural gas through the year 2000 and it is equivalent to about 171,509 tons of CO₂ on a yearly basis.

4.

AEI commits to the design, marketing and development of major district heating and cooling projects in Southern New Jersey by 1998 through its subsidiary Atlantic Thermal Systems (ATS). It is estimated that these projects will have a minimum equivalent emission reduction of about 191,483 tons of CO₂ by the year 2000. These district heating and cooling projects represent an annual emission reduction of about 63,828 tons of CO₂.

5.

AEI commits to support the National Earth Comfort Program through its subsidiary Atlantic Electric at a level of $50,000/year for six years.

6.

AEI commits to continue exploring and researching opportunities in both its supply and demand side activities that will reduce greenhouse gas emissions in a cost-effective way.

7.

The estimated CO₂ emission reduction for the year 2000 is 315,260 tons for programs 1 through 4 above and the total estimated emission reduction through the year 2000 is approximately 1,972,500 tons.

Please send comments to:
Lawrence.Mansueti@hq.doe.gov