Climate Challenge Participation Letter

DOE's Energy Partnerships for a Strong Economy

This Participation Accord describes the commitments that Florida Power Corporation (FPC) and the United States Department of Energy (DOE) have made to participate in the Climate Challenge Program in pursuit of the President's goals for reducing greenhouse gas emissions. The Climate Challenge Program is a joint, voluntary effort of DOE and the electric utility industry to reduce, avoid or sequester greenhouse gas emissions. The framework of the Climate Challenge Program was established in the Climate Challenge Program Memorandum of Understanding and exhibits thereto dated April 20,1994 (the Climate Challenge Program MOU; Attachment A).

As set forth in I.A. of the Climate Challenge MOU, FPC is participating in the Climate Challenge Program voluntarily, recognizing that it is under an obligation to serve and provide electric service to all persons within FPC's designated service territory. FPC is experiencing high levels of growth in demand on its system relative to the rest of the nation, and FPC's ability to affect or limit growth in demand for electric service is limited.

I. FLORIDA POWER CORPORATION COMMITMENTS

A.
Consistent with Paragraph II.B.1 of the Climate Challenge Program MOU, FPC will undertake cost-effective actions designed to reduce its average emissions rate from 1632 lbs/mwh to 1450 lbs/mwh of CO₂ emissions. FPC estimates and expects that by achieving this goal, FPC will limit increases in CO₂ emissions to 5 million tons below baseline levels projected for the year 2000. FPC's projected baseline is based on its 1990 actual emission rate from FPC generating facilities (not including purchased power) and a growth rate that is included in FPC's filed Integrated Resource Plan.

B.
FPC intends to undertake specific actions designed to result in the aforementioned reduction of greenhouse gases. These actions may include the following: the reduced utilization or retirement of oil-fired units in favor of newly constructed gas-fired units; a continuation of FPC's demand side management program; implementation of FPC's nuclear performance project; and an increased reliance on natural gas. In addition, FPC agrees to diligently evaluate other and new cost-effective means and measures to reduce greenhouse gas emissions.

C.

FPC 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) of the Energy Policy Act and the Climate Challenge accounting protocols in the Supplemental Guidance on Commitment Definition and Reporting section of the Climate Challenge Program MOU. The first such report may include a description of the activities and achievements of FPC prior to its becoming a participant in the Program, expressed on an annual basis to the extent possible.

D.

FPC will confer with DOE on or before December 31, 1997 to evaluate jointly the progress of FPC in achieving its Climate Challenge Program goals and to discuss possible adjustments to its voluntary commitments.

E.

The Climate Challenge Program Representative for FPC will be:

W. Jeffrey Pardue, Director
Environmental Services Department
3201 34th Street south MAC H2G
St. Petersburg,FL 33733

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

A.
DOE commitments to FPC under the Climate Challenge Program are those set out in section III of the Climate Challenge Program MOU, which are hereby incorporated by reference.

B.

DOE will consider FPC'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 FPC for purposes of addressing Climate Challenge Program issues, it will provide notice to FPC.

C.

DOE will provide an annual report to FPC 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.

Consistent with I.H. of the Climate Challenge Program MOU, DOE agrees to recognize Florida Power Corporation's activities undertaken jointly with others in the manner designated by Florida Power Corporation, provided such designation is consistent with Section 1605(b) to the extent possible.

E.

To the extent permitted by applicable law and regulations and by the availability of funds, DOE will consider FPC's participation in Climate Challenge as a factor to be weighed positively in evaluating applications for financial and other assistance submitted to DOE in support of commitments made by FPC under this Participation Accord.

F.
The Climate Challenge Program Representative for DOE, who will serve as liaison to FPC, will be:

Allan R. Hoffman
Associate Deputy Assistant Secretary for Utility Technologies
U.S. Department of Energy
1000 Independence Avenue, SW
Washington, DC 20585
(202) 586-1786

DOE agrees to notify FPC 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 FPC 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.

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.

C.
In addition to the foregoing provisions, DOE and FPC 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 V.A - V.D, V.F and V.G of the Climate Challenge Program MOU, which are hereby incorporated by reference.

(Original Signed By)
Hazel R. O'Leary
Secretary of Energy
(date)
FEB 03 1995

Attachment:

Attachment A - Climate Challenge Program MOU and Exhibits

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