PJM Manual 14C: Generation and Transmission Interconnection Facility Construction Revision: 12 Effective Date: June 22, 2017

Transcription

1 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Revisin: 12 Effective Date: June 22, 2017 Prepared by System Planning Divisin PJM 2017

2 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Table f Cntents Table f Cntents Table f Exhibits...6 Apprval...7 Current Revisin...8 Intrductin... 9 Abut PJM Manuals... 9 Abut This Manual... 9 Intended Audience... 9 References Using This Manual...10 What Yu Will Find In This Manual...10 Sectin 1: Summary f Agreements Intercnnectin Service Agreement (ISA) ISA Prject Milestnes Security Deferred Security Rights Capacity Intercnnectin Rights Interim Capacity Intercnnectin Rights Injectin/Withdrawal Rights Intercnnectin Cnstructin Service Agreement (ICSA) Whlesale Market Participatin Agreement (WMPA) Interim Intercnnectin Service Agreement (IISA) Upgrade Cnstructin Service Agreement (UCSA) Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Overview ISA/ICSA Implementatin Phase Wrk Breakdwn Structure (WBS) Applicatin t Reginal Transmissin Expansin Plan (RTEP) Queue Based Prjects Large Generatin Resurces/Small Generatin Resurces Transmissin Owner Facilities Attachment Facilities Netwrk Upgrades Custmer Facilities Revisin: 12, Effective Date: 06/22/2017 PJM

3 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Table f Cntents Generatr Markets and Operatins ISA/ICSA Implementatin Phase Team Rle Clarity Intercnnectin Crdinatr Rle Descriptin and Respnsibilities...20 Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Schedule and Milestne Tracking Transmissin Owner Schedule Tracking Custmer Facility Cnstructin Schedule Tracking Cst Tracking Transmissin Owner Cst Estimate Prjectin Tracking Prject Billing Prcess Cst Respnsibility Transmissin Owner Billing Guidelines Quarterly Billing Suspensin Billing Final Invice Adjustments t Security During Cnstructin Quarterly Cst Recnciliatin Intercnnectin Custmer Billing/Statements Intercnnectin Custmer Billing Intercnnectin Custmer Mnthly Statements Prject Cst Recnciliatin Prcess Summary f Financial Respnsibilities Transmissin Owner Respnsibilities Intercnnectin Custmer Respnsibilities PJM Respnsibilities Generatin and Merchant Transmissin Prject Agreement Scpe Change Prcess Prject Site Reviews Outage Crdinatin Prject Suspensin Prject Cmmunicatin, Reprting and Dcumentatin Prject Drawings Mnthly Status Reprts Prject Meetings Test Energy Schedule Ntice f Cmpletin Dcumentatin Required frm the Intercnnectin Custmer Prir t Synchrnizatin Dcumentatin Required frm the Transmissin Owner Prir t Synchrnizatin Generatr As-Built Data Requirements Dispute Reslutin Breach, Cure and Default Assignment Revisin: 12, Effective Date: 06/22/2017 PJM

4 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Table f Cntents 3.13 Prject Clseut Sectin 4: Technical and Cnstructin Requirements Transmissin Owner Standards Need fr Intercnnectin Technical Requirements Applicatin f Intercnnectin Technical Requirements Technical Requirements n the PJM Website Cnstructin Standards Need fr Cnstructin Standards Applicatin f ITO Cnstructin Standards Cnstructin Standards n the PJM Website Sectin 5: Optin t Build Optin t Build Apprved Cntractrs and Manufacturers Drawing Review Inspectin, Testing, and Energizatin Sectin 6: Baseline and Supplemental Upgrade Prjects Baseline Upgrade Prjects RTEP Agreements Designated Entity Agreement (DEA) Intercnnectin Crdinatin Agreement (ICA) Tracking Prjects Subject t a Designated Entity Agreement Prject Cmmunicatin, Reprting and Dcumentatin Design Standards Upgrade Prject Mdificatin Prcess Breach, Cure, Re-Evaluatin and Default Prject Clseut Prject Site Visit Backbne Prjects Prject Spnsr Auctin Parameter Requirements Upgrade Delays Cst Changes Cmpletin Supplemental Upgrade Prjects Tracking Upgrade Delays Cmpletin...51 Attachment A: Transmissin Owner Standard Invice Frm F Revisin: 12, Effective Date: 06/22/2017 PJM

5 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Table f Cntents Attachment B: Generatr and Merchant Transmissin Prject Agreement Scpe Change Frm Attachment C: Ntificatin Templates Attachment D: Ntice and Dcumentatin Checklist Attachment E: Upgrade Prject Designated Entity Agreement Mdificatin Frm Attachment F: Checklist fr New Equipment Energizatin Prcess Revisin Histry Revisin: 12, Effective Date: 06/22/2017 PJM

6 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Table f Exhibits Table f Exhibits Exhibit 1: ISA/ISCA Implementatin Phase Wrk Breakdwn Exhibit 2: Intercnnectin Prcess Team Clarity Diagram Exhibit 3: Transmissin Owner Standard Invice Frm F...52 Exhibit 4: Example f ISA/ICSA Phase Quarterly Cst Recnciliatin Exhibit 5: Generatr and Merchant Transmissin Prject Agreement Scpe Change Frm...54 Exhibit 6: Ntice and Dcumentatin Checklist Exhibit 7: Upgrade Prject Designated Entity Agreement Mdificatin Frm Exhibit 8: New Equipment Energizatin Prcess Checklist Revisin: 12, Effective Date: 06/22/2017 PJM

7 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Apprval Apprval Apprval Date: 07/05/2017 Effective Date: 06/22/2017 Suzanne Glatz, Manager Infrastructure Crdinatin Revisin: 12, Effective Date: 06/22/2017 PJM

8 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Current Revisin Current Revisin Revisin 12 (06/22/2017): Sectin Incrprated requirements relevant t the new minimum design standards fr Designated Entities which were develped by the Designated Entity Design Standards Task Frce Revisin: 12, Effective Date: 06/22/2017 PJM

9 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Intrductin Intrductin Welcme t the PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin. In this Sectin yu will find: What yu can expect frm the PJM Manuals in general (see Abut PJM Manuals ). What yu can expect frm this PJM Manual (see Abut This Manual ). Hw t use this manual quickly and easily (see Using This Manual ). Abut PJM Manuals The PJM Manuals are the instructins, rules, prcedures, and guidelines established fr the peratin, planning, and accunting requirements f the PJM RTO and the PJM Energy Market. The manuals are gruped under the fllwing categries: Transmissin PJM Energy Market Generatin and transmissin intercnnectin Reserve Accunting and billing PJM administrative services Miscellaneus Fr a cmplete list f all PJM Manuals, g t the Library sectin at PJM.cm. Abut This Manual This PJM Manual, Generatin and Transmissin Intercnnectin Facility Cnstructin, is part f the PJM Manual 14 series family. This manual guides develpers f generatin and merchant transmissin prjects thrugh the PJM Reginal Transmissin Expansin Plan (RTEP) queue prject lifecycle frm agreement executin t cmmercial peratin and cnstructin agreement clseut. Additinally, it als describes the prcess arund tracking prjects driven by reliability criteria, enhanced market efficiency r Public Plicy requirements. Intended Audience The intended audiences fr this PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin are: Intercnnectin Custmers respective engineering, cnstructin and peratins staff, and cnsultants Upgrade Custmers respective engineering, cnstructin and peratins staff and cnsultants Transmissin Owners respective engineering and cnstructin staff and cnsultants Designated Entities respective engineering and cnstructin staff and cnsultants Revisin: 12, Effective Date: 06/22/2017 PJM

10 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Intrductin PJM Members PJM Staff Nte: The term Intercnnectin Custmer is used thrughut this dcument and is intended t refer t generatin Intercnnectin Custmers, Upgrade Custmers and Whlesale Market Participants. References There are ther PJM dcuments that prvide bth backgrund and detail n ther tpics. PJM Manual fr Generatin and Transmissin Intercnnectin Prcess Overview (M-14A) PJM Manual fr Reginal Planning Prcess (M-14B) PJM Manual fr Generatr Operatinal Requirements (M-14D) PJM Manual fr Merchant Transmissin Specific Requirements (M-14E) PJM Manual fr Cntrl Center and Data Exchange Requirements (M-01) PJM Manual fr Transmissin Operatins (M-03) PJM Manual fr Energy Management System (EMS) Mdel Updates and Quality Assurance (QA) (M-03A) Using This Manual We believe that explaining cncepts is just as imprtant as presenting the prcedures. This philsphy is reflected in the way we rganize the material in this manual. We start each sectin with an verview. Then, we present details, prcedures r references t prcedures fund in ther PJM manuals. What Yu Will Find In This Manual A table f cntents that lists tw levels f subheadings within each f the sectins An apprval page that lists the required apprvals and a brief utline f the current revisin Sectins cntaining the specific guidelines, requirements, r prcedures including PJM actins and Intercnnectin Custmer/PJM Member actins. Attachments that include additinal dcuments, frms, r tables that supprt this manual. A sectin at the end detailing all previus revisins f this PJM Manual Revisin: 12, Effective Date: 06/22/2017 PJM

11 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 1: Summary f Agreements Sectin 1: Summary f Agreements Welcme t the Summary f Agreements sectin f the PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin. In this sectin yu will find an verview f the different types f agreements that are an utcme f the PJM RTEP queue study prcess and discussin arund the aspects f the agreements that have a significant bearing n prject implementatin in a majrity f cases. Agreements discussed in this sectin include: Intercnnectin Service Agreements (ISA) Intercnnectin Cnstructin Service Agreements (ICSA) Whlesale Market Participant Agreements (WMPA) Upgrade Cnstructin Service Agreements (UCSA) Interim Intercnnectin Service Agreements (IISA) 1.1 Intercnnectin Service Agreement (ISA) Upn cmpletin f the System Impact Study, r the Intercnnectin Facilities Study if required, the Transmissin Prvider (PJM) will furnish an Intercnnectin Service Agreement t be executed by the Intercnnectin Custmer, the Transmissin Owner (TO) and PJM. The frm fr the ISA is fund in the PJM Tariff, Attachment O. In additin t Standard Terms and Cnditins the ISA defines prject specific rights and bligatins as fllws: Security Cst Intercnnectin Custmer milestnes Pwer factr requirements Descriptin f Custmer Facility Generatin (size, fuel type, verview f equipment, name, etc.) Merchant transmissin Maximum Facility Output (MFO) Rights Capacity Injectin Rights Injectin/Withdraw Rights Cnstructin respnsibility and wnership Single line diagram with Pint f Intercnnectin identified Metering requirements and wnership Transmissin Owner specificatins and standards Revisin: 12, Effective Date: 06/22/2017 PJM

12 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 1: Summary f Agreements The ISA is the standard agreement develped fr generatin and cntrllable flw transmissin prjects whse Pint f Intercnnectin is FERC-jurisdictinal. The ISA further identifies any changes in cnstructin respnsibility frm the Standard Optin fr Transmissin Owner Intercnnectin Facilities due t the Intercnnectin Custmer/ Develper exercising the Negtiated Cntract Optin r Optin t Build. See PJM Tariff, Attachment P, Appendix 2, Sectin and Sectin ISA Prject Milestnes Prject milestnes are defined in sectin 6 f the ISA. Milestnes prvide critical prject measuring pints and help cmmunicate t team members the timeframe and scpe f high level prject gals. ISAs are typically written t include the standard prject milestnes listed belw, but milestnes can be added r altered t custmize the agreement t suit the tracking needs f all invlved parties. The Intercnnectin Custmer must maintain cmpliance with pre-isa milestnes as stated in sectin Substantial site wrk The Intercnnectin Custmer is t demnstrate that 20% f site wrk is cmplete by the specified date. Additinally, the Intercnnectin Custmer must submit certified drawings f the Custmer Intercnnectin Facilities t the Transmissin Owner and PJM fr their review. Delivery f majr electrical equipment The Intercnnectin Custmer must demnstrate that all f the majr electrical material has been received at the prject site by the milestne date. Cmmercial peratin The Intercnnectin Custmer must make a cmmercial sale int PJM s whlesale market f the prject s energy utput r demnstrate the use f the facility s energy utput by the milestne date. As-Built dcumentatin The Intercnnectin Custmer must prvide certified dcumentatin verifying that the facilities cnstructed align with the PJM studies and agreements. Intercnnectin Custmers may request milestne extensins fr delays that were utside f their cntrl and that culd nt have been avided by exercising due diligence per sectin f the PJM Tariff Security Transmissin Owners are required t invice fr wrk specified in the Intercnnectin Cnstructin Service Agreement(s). Upn prject cmpletin r, if requested by the Intercnnectin Custmer, n a quarterly basis, true-up t the actual csts is cmpleted. The PJM Tariff requires that Security be cllected at the executin f the ISA and be held thrugh settlement f the final ICSA invice. Security wuld be called upn in the event f an invice nn-payment with resulting failure t clear Breach. Please see the PJM Tariff, Part VI, sectin 212.4(b) fr details n hw Security is calculated, adjusted and finally returned. Security is nt a depsit. When cash has been supplied fr Security, the Intercnnectin Custmer needs t authrize PJM t use Security t pay an invice. This can nly be dne when prtins f the wrk n Netwrk Upgrades have been cmpleted. Revisin: 12, Effective Date: 06/22/2017 PJM

13 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 1: Summary f Agreements Deferred Security The Intercnnectin Custmer may request t defer the cllectin f Security by up t 120 days after the Intercnnectin Custmer executes the ISA. The Security t be deferred may nly be fr Lcal Upgrades r Netwrk Upgrades fr which n ther Intercnnectin Custmer with a cmpleted System Impact Study has a cst respnsibility as described in the ISA. The Intercnnectin Custmer pays a depsit that is the greater f $200,000 r 125% f the estimated csts t be incurred fr wrk and/r prcurement activities dne by the Transmissin Owner during the first 120-day perid. The deferred security depsit is in additin t the required prject Security as listed in the Specificatins Sectin f the ISA. Of the deferred security depsit, $100,000 will be nn-refundable and in the case where the Intercnnectin Custmer terminates the ISA r is therwise withdrawn, it will be used t fund any re-studies due t the prject s remval. Thrugh the perid prir t full Security being psted, the deferred security depsit will be used t pay prject invices, starting with the nn-refundable prtin. Upn psting f full prject security, the Intercnnectin Custmer can request that any remaining refundable prtin f the deferred security depsit be returned. Any remaining prtin f the deferred security depsit will be returned upn Initial Operatin. Please see the PJM Tariff, Part VI, Sectin 212.4(c) fr the details n deferred security Rights Fr Intercnnectin Custmers, the ISA cnfers injectin and withdrawal rights fr merchant D.C. and/r fully cntrllable A.C. transmissin prjects and any applicable Incremental Delivery Rights, Available Transfer Capability Revenue Rights and Auctin Revenue Rights. The rights that can be granted under an ISA are fund in the PJM Tariff, Attachment O, Appendix 2, Sectin Capacity Intercnnectin Rights Any Capacity Intercnnectin Rights granted t the generatin intercnnectin prject will be detailed in sectin 2.0 f the Specificatins f the ISA. Fr additinal infrmatin n Capacity Resurce status versus Energy Resurce status please see Manual 14A Interim Capacity Intercnnectin Rights If a prject reaches cmmercial peratin prir t the date their Capacity Intercnnectin Rights becme effective r befre cmpletin f all required Netwrk Upgrades, the Intercnnectin Custmer may request that PJM perfrm an interim deliverability study. The study utput may grant interim Capacity Intercnnectin Rights that are nly in effect fr the year studied Injectin/Withdrawal Rights Any firm r nn-firm injectin r withdrawal Rights frm PJM s transmissin system via a merchant DC r cntrllable AC transmissin facilities will be detailed in sectin 2.0 f the Specificatins f the ISA. Manual 14E prvides additinal infrmatin describing the rights available t merchant transmissin prjects. The interim Transmissin Injectin Rights are granted thrugh the same prcess as detailed abve fr Interim Capacity Intercnnectin Rights. Revisin: 12, Effective Date: 06/22/2017 PJM

14 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 1: Summary f Agreements Fr additinal infrmatin n the ISA, refer t the Intercnnectin Service Agreement sectin in Manual 14A. 1.2 Intercnnectin Cnstructin Service Agreement (ICSA) The Intercnnectin Cnstructin Service Agreement (ICSA) is the cmpanin agreement t the ISA and is necessary fr prjects that require the cnstructin f Intercnnectin Facilities as defined in the ISA Specificatins sectin 3.0. The ICSA details the fllwing items: Prject scpe Cnstructin respnsibilities f the invlved parties Ownership f transmissin and custmer intercnnect facilities Schedule f majr cnstructin wrk. The ICSA Standard Terms and Cnditins specify hw the cnstructin will be perfrmed and the auxiliary prcesses such as prject suspensin, Optin t Build, and Breach. The ICSA is executed amng the Intercnnectin Custmer, PJM and the Transmissin Owner. In the case that there are multiple affected Transmissin Owners, a separate ICSA will be executed with each ne. The frm f an ICSA is fund in the PJM Tariff, Attachment P. Upn cmpletin f cnstructin and satisfactry cmpletin f terms under the ICSA Sectin 14 PJM will terminate the ICSA. 1.3 Whlesale Market Participatin Agreement (WMPA) Generatrs planning t cnnect t the lcal distributin systems at lcatins that are nt under FERC jurisdictin and wish t participate in PJM s market need t execute a PJM Whlesale Market Participatin Agreement (WMPA). FERC jurisdictin is determined by whether a previus whlesale sale has taken place at the Pint Of Intercnnectin r if the Whlesale Market Participant has received Qualifying Facility status prir t entering PJM s Queue. Similar t an ISA, the WMPA cnfers any rights assciated with the intercnnectin f a generatr as a Capacity Resurce and/r Energy Resurce and any peratinal restrictins r ther limitatins n which thse rights depend. The WMPA des nt define the bligatins f the Whlesale Market Participant regarding the cst respnsibility fr any required upgrades t the distributin system, but can cntain required Lcal Upgrades r Netwrk Upgrades t the Transmissin System. Any impacts t the Transmissin System wuld result in an accmpanying ICSA. The WMPA is executed between PJM, the Whlesale Market Participant and any affected Transmissin Owner(s). Cnstructin respnsibility shuld be defined in an intercnnectin agreement (IA) between the Whlesale Market Participant and any affected distributin facility wners. PJM is nt a party t the IA. WMPA milestnes typically fllw thse discussed in the ISA sectin and can cntain an additinal milestne fr the executin f the Intercnnectin Agreement. Any Capacity Intercnnectin Rights are detailed in sectin 2 f the WMPA specificatin sectin and are the same as thse cnferred under the ISA. Revisin: 12, Effective Date: 06/22/2017 PJM

15 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 1: Summary f Agreements 1.4 Interim Intercnnectin Service Agreement (IISA) Under certain circumstances, an Intercnnectin Custmer may wish t initiate prject cnstructin activities n an expedited basis prir t cmpletin f the Intercnnectin Studies. One example f such a circumstance is t request that rders be placed fr equipment r materials that have a lng lead time fr delivery. T initiate such an advance f cnstructin activities, the applicant may request executin f an Interim Intercnnectin Service Agreement (IISA) fr thse cnstructin activities being advanced. The frm f an IISA is fund in the PJM Tariff, Attachment O-1. Security required under the IISA is calculated as the ttal estimated csts f all activities being advanced under the agreement. The IISA binds the Intercnnectin Custmer t all csts incurred fr the cnstructin activities being advanced pursuant t the terms f the PJM Tariff. While PJM agrees t prvide the applicant with the gd faith estimate, determined in crdinatin with the affected Transmissin Owner(s) fr the csts f the Intercnnectin Facilities and ther charges that may be incurred fr the wrk being advanced, such estimate shall nt be binding. The Intercnnectin Custmer must agree thrugh executin f the IISA t cmpensate PJM and the affected Transmissin Owner(s) fr all csts incurred due t the advanced activities. PJM Tariff, Attachment O-1, Sectin 7.0(a) states that unless it is therwise described in the Specificatins f the IISA, the agreement des nt authrize Intercnnectin Service fr the Intercnnectin Custmer. 1.5 Upgrade Cnstructin Service Agreement (UCSA) The terms and cnditins f an Upgrade Cnstructin Service Agreement (UCSA) gvern the cnstructin activities assciated with the upgrade f capability n PJM bulk electric system in rder t accmmdate an Upgrade Request. Facilities cnstructed under an UCSA are nt wned by an Upgrade Custmer. All wnership rights f the physical facilities are retained by the respective Transmissin Owner fllwing the cmpletin f cnstructin. PJM and the Upgrade Custmer execute a separate UCSA with each impacted transmissin wner. An Upgrade Custmer retains the right, but nt the bligatin ( Optin t Build ), t design, prcure, cnstruct and install all r any prtin f the Direct Assignment Facilities and/r CustmerFunded Upgrades. The frm fr the UCSA can be fund in the PJM Tariff, Attachment GG. Revisin: 12, Effective Date: 06/22/2017 PJM

16 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Welcme t the Intercnnectin Service Agreement/Intercnnectin Cnstructin Service Agreement (ISA/ICSA) implementatin phase Overview sectin f the PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin. This sectin presents the Wrk Breakdwn Structure (WBS) fr the Intercnnectin Service Agreement/ Intercnnectin Cnstructin Service Agreement (ISA/ICSA) implementatin phase alng with descriptins f the varius majr activities and deliverables within each categry. The fllwing infrmatin is presented in this sectin: An verview f the typical majr activities invlved with intercnnecting a Custmer Facility Descriptins f the different types f system upgrades that may accmpany intercnnectin prject Descriptin f the PJM Intercnnectin Crdinatr rle 2.1 Overview T effectively crdinate a prtfli f Generatin and Merchant Transmissin prjects, PJM takes a Prject Management Mdel apprach t the implementatin phase f the Intercnnectin Service Agreement/Intercnnectin Cnstructin Service Agreement (ISA/ICSA) f intercnnectin prjects. 2.2 ISA/ICSA Implementatin Phase Wrk Breakdwn Structure (WBS) An effective tl fr managing the activities and deliverables assciated with intercnnectin prjects is a Wrk Breakdwn Structure (WBS). The WBS can be used as a fundatin fr crdinatin f nearly all ther aspects f prjects. Fr example, prject schedules, cst estimates, prject dcumentatin and cmmunicatin frmats can all be derived frm the basic WBS. Exhibit 1 belw shws the WBS fr the ISA/ICSA implementatin phase. The majr categries f fcus in this phase are the Transmissin Owner Facilities, Custmer Facilities, and Generatr Markets and Operatins. The fllwing categry and sub-categry descriptins are prvided t explain the significance f each cmpnent f the WBS. Clearly, just abut every prject is different and requires a certain level f custmizatin t the specific nuances f the prject, but spelling ut majr activities in this manner prvides a baseline frm which PJM, Transmissin Owners and Intercnnectin Custmers can custmize as apprpriate. Mrever, these majr activities can als be cnsidered as the minimum prject activities (where applicable) that PJM is interested in tracking thrugh the ISA/ICSA implementatin phase life cycle Applicatin t Reginal Transmissin Expansin Plan (RTEP) Queue Based Prjects PJM Manual 14C applies t the engineering and cnstructin implementatin phase fr all types f RTEP prjects. The prject cntrls detailed herein are applicable t generatin intercnnectin prjects, Merchant Transmissin prjects, Incremental Auctin Revenue Revisin: 12, Effective Date: 06/22/2017 PJM

17 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Rights prjects, Lng Term Firm Transmissin Service Requests, Netwrk Upgrades and Lcal Upgrades required fr the reliable intercnnectin f the assciated prject. Exhibit 1: ISA/ISCA Implementatin Phase Wrk Breakdwn In additin, if cnstructin f facilities is required fr nn-jurisdictinal intercnnectins with executed Whlesale Market Participatin Agreements (WMPAs), the same prject cntrls utlined in this Manual 14C wuld apply if an ICSA is executed fr applicable cnstructin wrk required. The prject cntrls utlined in Manual 14C als apply t cases where an Interim ISA is executed and financial Security is cllected by PJM fr the purpse f initiating implementatin phase activities befre the cmpletin f the Facilities Study, such as purchasing lng lead time equipment, r perfrming engineering and cnstructin wrk Large Generatin Resurces/Small Generatin Resurces PJM Manual 14A utlines the study phase prcess differences between large generatin resurces (greater than 20MW) and small generatin resurces (20MW r less). While there are distinct differences in the paths that these types f prjects take in the study prcess, nce the prjects mve int the implementatin phase, the same prject cntrls utlined in this Manual 14C generally apply t bth large generatin resurces and small generatin resurces Transmissin Owner Facilities Transmissin Owner facilities include all Attachment Facilities and Netwrk Upgrades that will be wned and maintained by the Transmissin Owner nce a prject is in service. The wrk n Transmissin Owner facilities is typically perfrmed by the respective Transmissin Owners. Hwever, as detailed in the PJM Tariff and discussed later in this manual, an Intercnnectin Custmer may elect t exercise the Optin t Build alternative during the ISA/ICSA executin phase per the prvisins f the agreement. Revisin: 12, Effective Date: 06/22/2017 PJM

18 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Attachment Facilities Attachment Facilities, as defined by the PJM Tariff, Part I, Sectin 1.3, are required t be cmpleted in rder fr the prject t mve frward t Stage One energizatin as defined by the PJM Tariff, Attachment P, Appendix 2, Sectin 3.9A. This is the pint at which the generatr is intercnnected with the transmissin system and back-feed pwer is available t the Custmer Facility fr testing and cmmissining. The main Attachment Facility prject activities are listed belw. Real Estate, Siting, and Permits Represents activities including facilities siting, acquisitin f critical land use, envirnmental, state and lcal permits, and acquisitin f real estate/right f way Detailed Design Includes cmpletin f Attachment Facilities engineering and detailed design activities that were nt cmpleted in the Facilities Study phase Majr Electrical Equipment Delivery Activities that represent the duratin f the prcurement, fabricatin and delivery t site fr majr electrical equipment and material assciated with the Attachment Facilities Cnstructin and Testing Activities that represent the duratin f the majr cnstructin and testing tasks related t the Attachment Facilities. This wuld include all pre-utage cnstructin and testing activities Intercnnectin (Stage One) Energizatin Reflects the utages required fr perfrming final cnnectins, cmmissining and testing activities, and represents the intercnnectin f the Custmer Facilities t the electrical grid Netwrk Upgrades Netwrk Upgrades, as defined by the PJM Tariff, Part I, Sectin 1.26, are identified n the basis f lad flw, shrt circuit, deliverability and stability analysis as part f the RTEP prcess, and can include wrk such as breaker replacements r upgrades, new transfrmers r ther substatin equipment. Netwrk Upgrades can als include cnstructin f new transmissin lines, recnductring f transmissin lines between substatins, and intercnnectin substatins. Nt all prjects require Netwrk Upgrades. The cst allcatin methdlgies fr Netwrk Upgrades are discussed in PJM Manual 14A. The PJM Tariff defines tw types f Netwrk Upgrades fr the purpse f establishing financial Security requirements: Direct Cnnectin Netwrk Upgrades are Netwrk Upgrades which nly serve the Custmer Intercnnectin facility and have n impact r ptential impact n the Transmissin System until the final tie-in is cmplete. Nn-Direct Cnnectin Netwrk Upgrades are parallel flw Netwrk Upgrades that are nt Direct Cnnectin Netwrk Upgrades. Similarly, fr generatin intercnnectins t a Transmissin Owner s distributin system, the PJM Tariff differentiates between Direct Cnnectin Lcal Upgrades and Nn-Direct Cnnectin Lcal Upgrades. PJM will track and may request detailed updates n each f the fllwing majr activities fr all Netwrk Upgrades. Revisin: 12, Effective Date: 06/22/2017 PJM

19 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Real Estate, Siting, and Permits Represents activities including the facilities siting, acquisitin f critical land use, envirnmental, state and lcal permits, and acquisitin f real estate/right f way Detailed Design Includes cmpletin f Netwrk Upgrade engineering and detailed design activities that were nt cmpleted in the Facilities Study phase Majr Electrical Equipment Delivery Activities that represent the duratin f the prcurement, fabricatin and delivery fr majr electrical equipment and material assciated with the Netwrk Upgrades Cnstructin and Testing Activities that represent the duratin f the majr cnstructin and testing tasks related t the Netwrk Upgrades. This wuld include all pre-utage cnstructin and testing activities. Netwrk Upgrade Cmplete Represents the cmpletin f the respective Netwrk Upgrades. PJM determines the required cmpletin dates fr Netwrk Upgrades in accrdance with Intercnnectin Custmer cmmercial peratin milestne and the RTEP analysis Custmer Facilities Custmer Facilities are defined in the PJM Tariff, Part I, Sectin 1.7A. PJM acknwledges that there is a brad range f activities related t the cnstructin f specific Custmer Facilities, hwever, the fllwing majr activities are cmmn and applicable t mst prjects: Engineering and Design Engineering and Design activities related t the Custmer Facility cnstructin Majr Permits Represents the cmpletin f acquisitin activities fr all critical land use, air, water, envirnmental and perating permits Majr Electrical Equipment Delivery Activities that represent the duratin f the prcurement, fabricatin and delivery fr majr critical path electrical equipment and material (i.e. CTGs, STGs, majr piping, etc.) Substantial Site Wrk Majr site cnstructin activities which are initiated with the site preparatin and are typically cnsidered cmplete with the end f civil cnstructin activities. Majr Fundatin Wrk Includes all majr fundatin wrk applicable t the facility cnstructin Custmer Intercnnectin Facility Cnstructin The cnstructin activities related t physically and electrically intercnnecting the Custmer Facility t the Transmissin System. Intercnnectin (Stage One) Energizatin Typically is assciated with the transmissin utages required fr perfrming final cnnectins and testing activities, and represents the task f cmpleting the intercnnectin f the Custmer Intercnnectin Facilities and the Transmissin Owner Attachment Facilities t the Transmissin System. This als includes energizing sme r all f the Custmer Facility. Unit Cnstructin Includes the erectin f all majr Custmer Facility equipment, fr example turbines, generatrs, switchgear, etc. Revisin: 12, Effective Date: 06/22/2017 PJM

20 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Unit Cmmissining Represents the cmmissining perid fr the unit(s), frm cmmissining testing t synchrnizatin and thrugh injectin f test energy Injectin f Test Energy Subset f unit cmmissining, but an imprtant task fr PJM System Operatins in the analysis and scheduling f lad flws. See the Test Energy sectin f Manual 14D fr additinal infrmatin. Stage Tw Energizatin Initial synchrnizatin t the Transmissin System f each unit at the Custmer Facility r the applicable facilities fr the Merchant Transmissin Facilities and the energizatin f the remainder f all required facilities and upgrades. Cmmercial Operatin Milestne date where the prject makes its first cmmercial energy sale r use f the facility s energy utput Generatr Markets and Operatins The Generatr Markets and Operatins sectin f the ISA/ICSA implementatin phase WBS includes the integratin f the Transmissin Owner Facilities and the Custmer Facility cnstructin with the applicable PJM internal rganizatins that need t be engaged in rder t achieve all f the requirements prir t cmmercial peratin f the facility. Please review the PJM Manual 14D fr details. 2.3 ISA/ICSA Implementatin Phase Team Rle Clarity Exhibit 2 utlines the varius disciplines invlved in the ISA/CSA implementatin phase. One f the keys t effectively achieving the respective prject gals and milestnes is thrugh clearly defined rles and effective cmmunicatin between all parties. The fcus f this manual is the Agreement Implementatin Phase and the sectin f the Exhibit 2 diagram is accrdingly labeled M-14C. 2.4 Intercnnectin Crdinatr Rle Descriptin and Respnsibilities Fr the ISA/ICSA implementatin phase, the PJM Intercnnectin Crdinatr assumes the respnsibility t ensure that all f the activities, deliverables and milestnes n the ISA/ICSA implementatin phase WBS are achieved thrugh the facilitatin f an inter-rganizatinal team cnsisting f PJM, Transmissin Owner, and Intercnnectin Custmer persnnel. The PJM Intercnnectin Crdinatr serves as the single pint f cntact wh slicits the supprt f the respective team members in rder t effectively facilitate the reslutin f issues and crdinate the activities that are critical t meeting the prject milestnes. Each intercnnectin prject will be assigned an Intercnnectin Crdinatr. In rder t manage these respnsibilities acrss the entire PJM ftprint, the PJM Intercnnectin Crdinatr als has the supprt f a PJM prject team as detailed in Exhibit 2. Please refer t the ther PJM series 14 Manuals fr the details n the functins and respnsibilities f the ther PJM team members shwn in Exhibit 2. The key respnsibilities that the PJM Intercnnectin Crdinatr implements with the supprt f the prject team include, but are nt limited t the fllwing: Primary PJM cntact in the implementatin phase frm the ISA/Interim ISA/ICSA/WMPA/ UCSA executin phase thrugh cmmercial peratin f the Custmer Facility Facilitates the reslutin f technical issues Revisin: 12, Effective Date: 06/22/2017 PJM

21 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Prject Cntrls prject milestne tracking, cst tracking, etc. Reviews Transmissin Owner invices t ensure inviced amunts match prjected wrk and are in line with the latest prject estimates Facilitates the reslutin f invicing issues between the Intercnnectin Custmer and the Transmissin Owner Facilitates the reslutin f agreement/tariff Issues, prject cnflicts, and dispute reslutin as necessary Manages the scpe change prcess as apprpriate (See Generatr and Merchant Transmissin Prject Agreement Scpe Change Prcess sectin belw) Perfrms peridic cnstructin site reviews f Transmissin Owner Facilities and Custmer Facility cnstructin sites t assess status f cnstructin and facilitate applicable prject issues Manages increases/decreases in Security as applicable Facilitates the mdeling f the prject in PJM peratins and markets mdels Supprts telemetry design and implementatin t ensure peratinal and revenue data requirements are met Engages PJM Client Managers and Market Settlements department t lead the setup f the prject s market accunt(s) Crdinates regular prject meetings in lieu f TO and Intercnnectin Custmer submitted mnthly status reprts Supprts the integratin f queue prjects with PJM Operatins and Markets departments thrugh utage crdinatin Engages PJM Generatin department t lead the setup f the prjects edart accunts Revisin: 12, Effective Date: 06/22/2017 PJM

22 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 2: Generatin and Merchant Transmissin Agreement Implementatin Phase Overview Exhibit 2: Intercnnectin Prcess Team Clarity Diagram Revisin: 12, Effective Date: 06/22/2017 PJM

23 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Welcme t the Agreement Implementatin Phase Prcesses sectin f the PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin. This sectin prvides details abut the prject cntrls cncepts and tls that PJM uses t facilitate the cmpletin f the agreement implementatin phase fr generatin and merchant transmissin prjects. The fllwing items are reviewed in this sectin: Schedule and milestne tracking Cst tracking Prject billing prcess Scpe change prcess Prject meetings Prject site reviews Prject suspensin Outage crdinatin Prject cmmunicatin, reprting and dcumentatin Generatr as-built data Dispute reslutin Breach, cure and default prcedure Prject assignment Prject clseut 3.1 Schedule and Milestne Tracking The accurate tracking f bth Transmissin Owner facilities and Custmer Facility schedules is critical fr PJM t successfully crdinate nt nly the timely achievement f Intercnnectin Custmer prject gals, but als t effectively crdinate the RTEP. PJM must rely n the supprt f Transmissin Owners and Intercnnectin Custmers t supply accurate schedule updates n a regular basis fr PJM t integrate int the RTEP queue database. The minimum schedule infrmatin required by PJM t be prvided n a regular basis is listed belw Transmissin Owner Schedule Tracking Attachment Facilities Current prgress/status Current prjected cmpletin date Current percent cmplete Actual cmpletin date Revisin: 12, Effective Date: 06/22/2017 PJM

24 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Cash flw/estimated cst f cmpletin Cmparisn t estimated cst Prjected Stage One energizatin date (backfeed) Netwrk Upgrades (r Lcal Upgrades) Current prgress/status Current prjected cmpletin date Current percent cmplete Actual cmpletin date Current percent cmplete Cash flw/estimated cst f cmpletin Cmparisn t estimated cst In additin, PJM uses input frm rutine prject status meetings and cmmunicatins with Transmissin Owners and Intercnnectin Custmers t update the RTEP queue database accrdingly. PJM will apply particular attentin n the Stage One energizatin (i.e. backfeed pwer) target date, since this date is critical fr integratin f prjects int PJM Markets and Operatins and may require the cmpletin f Netwrk Upgrades. PJM will review test energy schedule and utput t crdinate the cmpletin f required Netwrk Upgrades t supprt intercnnectin. Per the FERC Market Efficiency Order, PJM has established an RTEP transmissin prject website which is updated based n status reprts submitted by Transmissin Owners and Intercnnectin Custmers. Transmissin Owners and Intercnnectin Custmers shuld use the fllwing standardized guidelines fr assigning percent cmplete infrmatin t PJM: Engineering and Planning (EP) Status: 0% - 25% (includes engineering, detailed design, material prcurement, resurce planning) Under Cnstructin (UC) Status: 26% - 100% 26% - 90% - Cnstructin Activities 91% - 100% - Testing and Inspectin Nte: Netwrk Upgrades related t queued prjects that have been suspended are designated with the status: On Hld Custmer Facility Cnstructin Schedule Tracking PJM Tariff Attachment P, Appendix 2, Sectin 3.7 requires that each cnstructing entity issue status reprts n a mnthly basis regarding the status f cnstructin f Intercnnectin Facilities. PJM acknwledges that mst Custmer Facility cnstructin schedules are unique t the respective prject and there is a brad range f infrmatin that can be prvided. Rutine Revisin: 12, Effective Date: 06/22/2017 PJM

25 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses schedule task updates are required t be prvided t PJM frm Intercnnectin Custmers in their wn preferred custmized frmat (i.e. Micrsft Prject, Excel spreadsheet, etc.) r can be prvided thrugh regular prject status meetings. PJM is interested in summary level schedule updates frm Intercnnectin Custmers, but at a minimum, PJM requires the status infrmatin fr each f the items belw: Start date Cmpletin date target Current activity percent cmplete Majr items t be addressed in the Intercnnectin Custmers mnthly updates: Engineering and design Majr electrical equipment delivery Substantial site wrk Majr fundatin wrk Custmer Intercnnectin Facility cnstructin Stage One energizatin Unit cnstructin Unit cmmissining Injectin f test energy Stage Tw energizatin 3.2 Cst Tracking The Transmissin Owner is t supply PJM and the Intercnnectin Custmer with an estimated quarterly cash flw. This prvides the Intercnnectin Custmer with an understanding f upcming invice amunts and helps t insulate the Transmissin Owner frm the financial risk f the prject. Tracking f current estimated csts fr Transmissin Owner Attachment Facilities and system upgrade activities is critical fr PJM s facilitatin f the RTEP. In additin, changes in csts may trigger the need fr an adjustment in prject Security and can impact Intercnnectin Custmer s business decisins. It is imprtant fr PJM and the Intercnnectin Custmer t be made aware f any majr changes in the current estimated csts at cmpletin fr any prject upgrade during the curse f the life cycle f these activities in a timely manner, rather than after the wrk is cmplete. It is als imprtant fr PJM t have the mst accurate cst data fr use in the cst allcatin prcess fr Netwrk Upgrades that may be assigned t mre than ne Intercnnectin Custmer. The RTEP is dynamic, and therefre PJM must rely n the supprt f Transmissin Owners and Intercnnectin Custmers t supply, n a regular basis, accurate cst estimate prjectin updates fr PJM t integrate int the RTEP database. Revisin: 12, Effective Date: 06/22/2017 PJM

26 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Transmissin Owner Cst Estimate Prjectin Tracking At a minimum, PJM requires that the Transmissin Owner prvide the fllwing infrmatin t PJM n a regular basis. Attachment Facilities Current prjected cst at cmpletin Cmparisn t estimated cst Netwrk Upgrades Current prjected cst at cmpletin Cmparisn t estimated cst Upgrade cst updates may be prvided in cnjunctin with regular prject status meetings, and shuld als be in alignment with the PJM scpe change prcess fr revisins. Transmissin Owners shuld nte that the cst prjectins prvided shuld nly include Cntributins in Aid f Cnstructin (CIAC) tax grss-up amunts if applicable (reference PJM Tariff, Attachment O, Schedule G). An Intercnnectin Custmer agrees t cnfrm t IRS requirements fr nn-taxable status via ISA and ICSA language cntained in Schedules G and L, respectively. Therefre, the Intercnnectin Custmer is nt required t supply supprting dcumentatin unless there has been an IRS determinatin against the prject. 3.3 Prject Billing Prcess Cst Respnsibility The Intercnnectin Custmer is respnsible fr all f the csts assciated with the intercnnectin f the Custmer Facility as specified in the PJM Tariff, Part I, Sectin 217. These Csts may include, but are nt limited t the Transmissin Owner s wrk n Attachment Facilities, Lcal Upgrades, and Netwrk Upgrades. The Intercnnectin Custmer is als respnsible fr any csts incurred during the integratin f the prject int PJM Operatins and Markets Transmissin Owner Billing Guidelines In rder t establish clarity and ensure cmpliance with the billing requirements in FERC Order 2003, PJM implemented a system f standardized Transmissin Owner invice frms. The TO standard invice frm fr the ISA/ICSA implementatin phase is included in this manual in Attachment A Transmissin Owner Standard Invice Frm F. Fr prjects gverned by a WMPA, billing fr wrk perfrmed by the Transmissin Owner will ccur directly between the Transmissin Owner and the Intercnnectin Custmer and be gverned by the terms and cnditins f the tw-party prject intercnnectin agreement. PJM requires that Transmissin Owners prvide billing infrmatin n the invice frm thrughut the ISA/ICSA implementatin phase t maintain accuracy within PJM s accunting system and als t supprt the accunting needs f the Intercnnectin Custmers. Cntinuity in Transmissin Owner invicing infrmatin will assist in the timely prcessing and payment f invices, and minimize the vlume f infrmatin requests t the Transmissin Owners related t invices. Revisin: 12, Effective Date: 06/22/2017 PJM

27 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses The fllwing sectins cntain guidelines fr Transmissin Owner billing t PJM Quarterly Billing The Transmissin Owner is t prvide an invice t PJM n a quarterly basis fr wrk t be perfrmed in the next subsequent quarter. This is necessary t ensure cnsistency with cash flws as required by Order Transmissin Owners are required t submit a cmpleted Frm F fr each Attachment Facility item (queue #) and each respective Netwrk Upgrade (Netwrk Upgrade #) in additin t the Transmissin Owner s invice cver sheets. The initial invice shuld be submitted t PJM prir t the start f wrk. Upn the executin f the ICSA (r Interim ISA), the TO shuld evaluate and update any cash flw infrmatin prvided previusly. This cash flw can be reviewed with the prject team at the cnstructin kickff meeting. Subsequent quarterly invicing shuld fllw the prjected cash flw, and adjustments t the prject cash flw can be made during the curse f the prject, if apprpriate and agreed t by all parties, and dcumented thrugh the scpe change prcess. Transmissin Owners that d nt submit timely invices prir t wrk are at risk f creating an imbalance with respect t Security cllected fr the prject and pssibly render inaccurate any prjected cash flw infrmatin. In rder fr PJM t efficiently prcess invices by the 5th f the next mnth, Transmissin Owners shuld submit quarterly invices t PJM by the 25th f the mnth prir t the quarter reflected by the billing. PJM cannt guarantee that billing will be included in the next invicing cycle (5th business day f the next mnth) if invices are nt received by the abve date. Transmissin Owner billing is t be based n calendar quarter: Fr the initial invice, the invice shuld include the prjected csts fr wrk t be cmpleted during the remaining mnths f the current calendar quarter. The secnd invice fr the first full calendar quarter wuld then be submitted t PJM prir t the beginning f the next calendar quarter. Transmissin Owners shuld prvide a quarterly billing frm each quarter during the entire duratin f the cnstructin wrk. If there are particular quarters where there are n prjected csts, the TO shuld submit a quarterly billing invice frm (PJM TO Standard Invice Frm F) nly if there is a change in the Estimated Cst at Cmpletin amunts. The TO invice cver sheet is nt required in this case. PJM requires that the Transmissin Owner prvide the fllwing breakdwn f cst infrmatin n the submitted Frm F (nte: csts are TO scheduled expenditures): Majr electrical equipment csts TO labr csts Outside services/subcntractr csts Miscellaneus csts (i.e. easement r right-f-way fees, permits, etc.) CIAC tax grss-up csts (if applicable) Revisin: 12, Effective Date: 06/22/2017 PJM

28 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses The abve cst breakdwn infrmatin is required fr each f the fllwing clumns in Frm F: Current Inviced, Previus Cumulative Amunt, Cumulative Amunt Billed t Date and Ttal Estimated Amunt at Cmpletin. The Ttal Estimated Amunts at Cmpletin shuld reflect the cst estimates breakdwn as described in the ISA r thse adjusted thrugh a scpe change. The Ttal Original Cst fr Upgrade/Queue field shuld be the riginal ttal, unallcated cst fr that specific queue (Attachment Facilities cst) r Netwrk Upgrade. The Ttal Revised Cst fr Upgrade/Queue field shuld be the current apprved cst as reflected by any scpe changes dcumented thrugh the scpe change prcess Suspensin Billing Fr a prject entering suspensin, the TO is required t perfrm a cst true-up t ensure there are n utstanding prject csts pen against the prject while it is in suspensin. If a prject is under suspensin, a quarterly billing invice frm is nt required Final Invice The Transmissin Owner is required t prvide the final invice t PJM within 120 days after cmpletin f cnstructin and installatin activities required per the ICSA Appendix 2, Sectin 9.3. The Transmissin Owner will mark the final invice as Final. Acknwledging the varius scenaris fr the timing f cmpletin f Attachment Facilities r Netwrk Upgrades, the cmpletin f Intercnnectin Facilities/ Netwrk Upgrades is generally cnsidered t be in alignment with the fllwing guidelines: Attachment Facilities - cmpletin date is the date f Stage One energizatin f Attachment Facilities in accrdance with PJM Tariff, Attachment P, Appendix 2, Sectin Netwrk Upgrades cmpletin date is the date f Stage Tw energizatin f Intercnnectin Facilities in accrdance with PJM Tariff, Attachment P, Appendix 2, Sectin Adjustments t Security During Cnstructin The PJM Intercnnectin Crdinatr will make adjustments t Security and balance amunts retained as apprpriate thrugh the curse f cnstructin in accrdance with PJM Tariff prvisins and the scpe change prcess. Reductins in Security can be requested by the Intercnnectin Custmer as wrk n Netwrk Upgrades r Lcal Upgrades cmpletes. It is typical PJM practice t hldback 25% f the estimated cst f the wrk until the financial clse ut t ensure sufficient Security is in place t cver any cst verruns. Any remaining Security will be returned after the cst true-up ccurs with the Transmissin Owner s submittal f the final prject invice t PJM Quarterly Cst Recnciliatin An Intercnnectin Custmer may request, at the time f the executin f the ISA that quarterly cst recnciliatin be dne. The quarterly cst recnciliatin will be dne at a maximum frequency f ne quarter in arrears (i.e. the third quarterly invice wuld prvide the recnciliatin fr the first quarter). Attachment A includes an example f hw the quarterly cst Revisin: 12, Effective Date: 06/22/2017 PJM

29 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses recnciliatin cells n the TO Standard Invice Frm F culd be filled ut fr a typical prject with cnstructin wrk billed n an advanced quarterly basis Intercnnectin Custmer Billing/Statements The billing frmat and sequencing utlined in the previus sectin (Transmissin Owner Billing Guidelines) enables PJM t prvide the advanced quarterly billing t the Intercnnectin Custmer fr cst respnsibility fr wrk t be perfrmed n Attachment Facilities and Netwrk Upgrades as required by the PJM Tariff Intercnnectin Custmer Billing On the 5th business day f each mnth, PJM sends invices via nly fr shrtfalls in accunts t Intercnnectin Custmers. The Intercnnectin Custmer invices cnsist f the fllwing cmpnents: message stating the purpse and cntent f the PJM invice attachment SAP summary reprt attachment SAP current activity frm previus billing reprt line item reprt attachment A separate is sent fr cpies f Transmissin Owner Invices. Per the PJM Tariff, the Intercnnectin Custmer is required t pay inviced amunts within 20 calendar days f the receipt f the invice. The failure by an Intercnnectin Custmer t make a timely payment f an invice can lead t prject terminatin. Breach, Cure, and Default prcedures are utlined in PJM Tariff Attachment P, Appendix. 2, Sectin 13. In the event an Intercnnectin Custmer chses t dispute all r prtins f an invice, PJM Tariff, Attachment O, Sectin r Attachment GG, Sectin 9.4 details the dispute prcess Intercnnectin Custmer Mnthly Statements On the 15th business day f each mnth, PJM sends a statement via t all Intercnnectin Custmers fr prjects that have entered the ISA/ICSA implementatin phase. The Intercnnectin Custmer mnthly statements cnsist f the fllwing cmpnents: message stating the purpse and cntent f the SAP summary reprt by phase attachment SAP line item detail reprt (prject ttal histry) attachment Prject Cst Recnciliatin Prcess PJM perfrms a cst recnciliatin at the end f the ISA/ICSA implementatin phase f Intercnnectin Custmer prjects and when a prject enters suspensin. As the party cntrlling the transfer f funds between the Intercnnectin Custmer and the Transmissin Owner, PJM requires the cst recnciliatin t be cmpleted as part f the invicing prcess. Revisin: 12, Effective Date: 06/22/2017 PJM

30 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Standard supprt dcuments fr cst recnciliatin are PJM SAP reprts, Transmissin Owner invices and supprt dcumentatin, and PJM created cst summaries, when netwrk upgrades are allcated t multiple prjects Summary f Financial Respnsibilities Transmissin Owner Respnsibilities Timely billing and cst tracking during the ISA/ICSA implementatin phase Effective scpe change prcess usage Adequate cmpletin f TO standard invice frm Timely submissin f final invice Submittal f recnciliatin f actual csts versus inviced csts as required Supprts custmer audits as requested Intercnnectin Custmer Respnsibilities Cmmunicatin with PJM and TO n cst tracking fr Attachment Facilities and Netwrk Upgrades thrughut duratin f cnstructin Supprt f scpe change prcess if applicable Timely payment f PJM invices Maintain intercnnectin invice lg t cmpare t PJM statements PJM Respnsibilities Facilitatin f billing and cst tracking issues thrughut the intercnnectin prcess Prvide invices as required and mnthly statements t Intercnnectin Custmer thrughut the intercnnectin prcess Effective fllw-up with Intercnnectin Custmers n payment f invices within 20 days; Breach prcedures are utlined in PJM Tariff Attachment P, Appendix 2, Sectin 13 Effective scpe change prcess facilitatin Generate prject actual cst summaries as needed Recncile final accunt balances between Intercnnectin Custmer and Transmissin Owner Facilitate cmpletin f financial clseut dcumentatin Manage requests fr increases/decreases in Security Manage deferred Security prcess with requirements fr full Security and release f nnrefundable Security upn initial peratin Review Transmissin Owner invices fr reasnableness and prcess, including splitting Netwrk Upgrade cst allcatins when mre than ne queue prject has financial respnsibility Revisin: 12, Effective Date: 06/22/2017 PJM

31 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses 3.4 Generatin and Merchant Transmissin Prject Agreement Scpe Change Prcess The scpe change prcess is t be utilized during the implementatin phase f Intercnnectin Custmer prjects. The intent f the scpe change prcess is t imprve the administratin f Intercnnectin Facilities cnstructin, and t reduce the need fr amendments t prject agreements that were previusly required when significant changes in the scpe, cst r schedule ccurred due t circumstances that were unfreseen at the time f agreement executin. The scpe change prcess prvides fr a clear methd f dcumentatin f prject changes. This results in Intercnnectin Custmers being infrmed abut scpe changes in a timely manner, increased cmmunicatin between the Transmissin Owner, Intercnnectin Custmer and PJM, and fewer disputed issues at the end f prjects. Many f the changes that nrmally ccur n a typical Intercnnectin Facilities prject are minr and they d nt have a meaningful impact n the cst r scheduled cmpletin f wrk. Hwever, if in the judgment f any party, the changes in the cst f required facilities r in the time required fr their cmpletin are sufficiently large t have a meaningful impact n the ttal cst r timing fr cmpleting the Intercnnectin Facilities, then the scpe change prcess is designed t be the apprpriate instrument t dcument such changes. The scpe change prcess is applicable t thse prjects with three-party ISAs, ICSAs, UCSAs, IISAs and WMPAs. The scpe change prcess can nly be applied t previusly defined impacts related t an intercnnectin prject as defined in the applicable agreement. If a particular scpe change results in the requirement f a new impact nt previusly included in PJM s intercnnectin studies, then an amended agreement will need t be executed. The scpe change prcess will nt be used t change a prject s fuel type in thse cases where it changes the type f analysis that PJM is required t perfrm. Thus, the prcess is applicable t any changes that affect the currently defined scpe f an Intercnnectin Custmer prject. Fr example, the scpe change prcess wuld apply in the case f a previusly defined Netwrk Upgrade that requires cnstructin f a new segment f transmissin line in the event that detailed design r initial excavatins fr the new transmissin twers revealed unexpected subsurface cnditins that required altering the fundatin design, and thus the prjected cst and/r schedule fr cmpletin f the twer fundatins. Anther typical applicatin f the scpe change prcess wuld be the case where the TO has determined that due t a six mnth delay in the delivery f a circuit breaker that is required t cmplete a breaker replacement netwrk upgrade, the in-service date fr that particular netwrk upgrade will be significantly delayed, and the revised cmpletin date wuld be reflected in the scpe change frm. The scpe change prcess is designed t have the flexibility t be initiated by the Transmissin Owner, Intercnnectin Custmer, r PJM Any wrk initiated befre PJM dispsitins the scpe change shall be cnsidered wrk dne at risk. The fllwing are typical situatins where an Intercnnectin Custmer, Transmissin Owner, r PJM may initiate the scpe change prcess: Transmissin Owner: Significant cst verrun prjected during the implementatin phase Revisin: 12, Effective Date: 06/22/2017 PJM

32 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Identificatin f additinal scpe nt identified in the Facilities Study but identified later during detailed design Delay in majr prject tasks (i.e. backfeed pwer energizatin r cmpletin f a Netwrk Upgrade) Intercnnectin Custmer: Delay f any agreement milestne Change in prject scpe resulting in mdificatin t Transmissin Owner Facilities scpe Change in Custmer Facility equipment characteristics PJM: Ntificatin t Intercnnectin Custmer abut changes t netwrk upgrade requirements due t retl analysis Ntificatin t Intercnnectin Custmer t mdify Security amunt r Letter f Credit (LOC) expiratin date If an initiated scpe change results in a significant cst increase, the scpe change prcess is used t identify any additinal Security amunt required t be prvided by the Intercnnectin Custmer withut having t execute an amended agreement. Likewise, if an initiated scpe change results in a milestne schedule change (i.e. fundatin wrk cmplete, intercnnectin substatin energized, etc.) then the scpe change prcess is used t identify the revised prjected cmpletin date and triggers a cst estimate review by the Transmissin Owner. The scpe change prcess prvides fr the Transmissin Owner and Intercnnectin Custmer acknwledgment, thugh nt their apprval, f each scpe change. In the event an Intercnnectin Custmer r Transmissin Owner bjects t a prpsed change in scpe, PJM, as it des with respect t ther cnstructin related issues cnsistent with PJM Tariff, Attachment O, Appendix 2, Sectin 20, will facilitate discussins between the Intercnnectin Custmer and the relevant Transmissin Owner t ensure the parties are infrmed f the reasns and justificatins fr the change. A custmer s refusal t acknwledge the scpe change will nt, hwever, preclude implementatin f a change that PJM finds t be apprpriate and reasnable. The Intercnnectin Custmer will remain respnsible, in accrdance with the PJM Tariff, fr the full cst f the required upgrades. Shuld the Intercnnectin Custmer cntinue t dispute the apprpriateness f a scpe change and/r any increased csts related t it, it may invke the PJM Tariff dispute reslutin prcedures. Please refer t Attachment B f this manual fr the Generatr and Merchant Transmissin Agreement Scpe Change Frm. 3.5 Prject Site Reviews PJM perfrms site visits n Intercnnectin Custmer prjects t crdinate with Intercnnectin Custmers and Transmissin Owners, assist the Intercnnectin Custmer prject in making a successful transitin int PJM s peratins and markets, review items under Revisin: 12, Effective Date: 06/22/2017 PJM

33 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses dispute, and verify cmpliance with agreement milestnes and/r prgress twards integratin (back-feed, turnver fr Optin t Build etc.). Site reviews allw PJM t assess the status f Transmissin Owner and/r Custmer Facility Cnstructin. Als a better wrking relatinship with the site prject manager can be develped t imprve the level f crdinatin with PJM internal rganizatins. A site visit may be cnducted t all applicable upgrades fr Intercnnectin Custmer prjects, during the cnstructin and start-up phases. When perfrming site visits, PJM will abide by all applicable safety rules including wearing f persnal prtective equipment such as hard hats, safety shes, eye prtectin, and fire resistant clthing. In additin, a hazard awareness briefing is recmmended prir t the inspectin t make everyne aware f the hazards at the site and the energizatin status f the equipment. Special precautins and site specific items need t be discussed during this awareness briefing. The crdinatin between PJM and the site is usually handled thrugh the PJM Intercnnectin Crdinatr assigned t the prject and the lcal prject/cnstructin manager. The bjective is t establish cmmunicatins early in the prject and btain regular updates. These updates are necessary t ensure the crdinatin f ther activities related t this prject, such as line utages, cmpletin f ther upgrades, and ther critical scheduled activities. Site visits can nrmally be cnducted arund ther rutine activities at the facility, such as regular status meetings, scheduling meetings, r site walkdwns. Typical items reviewed during a Custmer Facility site visit may include the milestnes frm the agreement(s), site wrk status, electrical equipment delivery, and energizatin schedule. The bjective is t make sure that the prject is prgressing, giving PJM enugh infrmatin t crdinate ther related n-ging activities, such as Netwrk Upgrades, metering, and integratin int System Operatins. During the site visit, digital phts and ntes may be taken. These are fr internal PJM reprts and database updates. The phts and ntes may be used fr equipment delivery verificatin, schedule prgressin, ne-line diagram verificatin, r ther apprpriate schedule activities. In summary, site visits help PJM nt nly ensure the reliability f the transmissin system by making sure upgrades are prgressing and cmpleted as required, but als help facilitate the crdinatin f ther behind the scenes activities within PJM. 3.6 Outage Crdinatin The PJM Tariff requires that Transmissin Owners and Intercnnectin Custmers crdinate all transmissin system utages with PJM in accrdance with the PJM System Operatins utage planning prcedures. In additin t the detailed planning that is required by the PJM System Operatins utage planning prcedures, Transmissin Owners and Intercnnectin Custmers can supprt PJM s lng range planning f utages by supplying the PJM Intercnnectin Crdinatr with schedule updates s that lng range utage planning infrmatin can be integrated int the PJM utage planning schedules. Additinally, the test energy plan prvided by the Intercnnectin Custmer prir t Stage Tw Energizatin is integrated int the utage planning prcess in cnjunctin with requested utages. During the agreement implementatin phase, the PJM Intercnnectin Crdinatr will prvide assistance, as required, in crdinating utages with PJM System Operatins and will facilitate Revisin: 12, Effective Date: 06/22/2017 PJM

34 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses the reslutin f majr utage related issues between PJM System Operatins, Intercnnectin Custmers, and Transmissin Owners. PJM utage requirements are described in detail in PJM Manual Prject Suspensin Prjects with an ICSA, UCSA r WMPA may elect t suspend that wrk fr a year and up t three years under certain circumstances. Prject suspensin pushes ut the agreement milestne dates cextensively fr the duratin f the suspensin time. Nte: WMPA suspensin must be supprted by the accmpanying tw-party Intercnnectin Agreement. Prjects that have entered the New Services Queue after February 1, 2011 nw are gverned by the fllwing rule: a single prject suspensin r cumulative suspensins greater than a year in length will nt be granted if they are deemed t be a Material Mdificatin, meaning it cannt affect any later Queue Psitin. In the event that an Intercnnectin Custmer initiates prject suspensin, the PJM Intercnnectin Crdinatr will facilitate the cmpletin f the fllwing activities in accrdance with the PJM Tariff: Cnfirm receipt f suspensin ntificatin frm Intercnnectin Custmer Cnfirm that Intercnnectin Custmer suspensin ntificatin meets PJM Tariff requirements Evaluate agreement milestnes and amend as required Update PJM database (prjected in-service date, netwrk upgrade in-service date) Assess impact n Netwrk Upgrades/baseline upgrades Facilitate Transmissin Owner cmpletin f high level assessment f knwn risks Evaluate Transmissin Owner suspensin csts Facilitate billing prcess fr Transmissin Owner suspensin csts (including cst recnciliatin and refunding f significant TO funds that may have been already cllected but will nt be used as prjected) Under PJM Tariff, Attachment P, Appendix 2, Sectin 3.4.2, it is the prject s respnsibility t ntify PJM and the TO t re-initiate prject wrk prir t the expiratin f available suspensin time. Failure t prvide ntice befre the end f the suspensin time perid will result in the prject being terminated. Under these circumstances, the Intercnnectin Crdinatr will send the terminatin letter t the Intercnnectin Custmer with a cpy als sent t the TO. Fr prjects that have gne thrugh a perid f suspensin, and cnstructin activities are resumed by the Intercnnectin Custmer, the PJM Intercnnectin Crdinatr will facilitate the cmpletin f the fllwing activities: Cnfirm receipt f the ntificatin frm Intercnnectin Custmer that the prject is cming ff f suspensin, and prvided the ntificatin t the Transmissin Owner Assess the current impact n Netwrk Upgrades/Baseline Upgrades Revisin: 12, Effective Date: 06/22/2017 PJM

35 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses Facilitate the Transmissin Owner s evaluatin and cnfirmatin f the current schedule and estimated csts Cmplete the scpe change prcess fr revisins t Intercnnectin Custmer agreement milestnes, TO schedule, and cst impacts, as applicable Update the PJM database 3.8 Prject Cmmunicatin, Reprting and Dcumentatin The fllwing are the main types f standard reprting and dcumentatin that are required thrughut the agreement implementatin phase: Prject Drawings The PJM Tariff, Attachment P, Appendix 2 Sectin and ISA sectin 6 substantial site wrk milestne requires the Intercnnectin Custmer t submit drawings certified by a prfessinal engineer fr the Custmer Intercnnectin Facilities t the Transmissin Owner and PJM. The Transmissin Owner and PJM will review the submitted drawings against the design that was analyzed in the planning mdel and return cmments within 45 days. Drawings nt cmmented n in that perid will be cnsidered apprved as-is. All drawings submitted are cnsidered Cnfidential Infrmatin Mnthly Status Reprts The PJM Tariff, Attachment P, Appendix 2 Sectin 3.7 requires that each Transmissin Owner and Intercnnectin Custmer engaged in ISA/ICSA implementatin activities prvide each ther (and PJM) with mnthly (at a minimum) status reprts. PJM requests that the prject schedule task and cst estimate infrmatin detailed in the Schedule and Milestne Tracking sectin f this manual be incrprated in these mnthly status reprts Prject Meetings In rder fr PJM t effectively crdinate the implementatin phase f intercnnectin prjects, Intercnnectin Custmers and Transmissin Owners shuld include PJM in regular prject status meetings. PJM participatin in regular prject meetings prvides the fllwing benefits: Better cllabratin between the Intercnnectin Custmer and Transmissin Owners PJM can mre practively facilitate prject integratin with internal PJM rganizatins, and invlve the apprpriate PJM cntacts at the right time Elevatin f PJM s awareness f prject issues and status with respect t schedule activities Mre efficient crdinatin f transmissin system utages Regular prject meetings may be held in lieu f Transmissin Owner and Intercnnectin Custmer submitting mnthly status reprts Test Energy Schedule Generally, ne mnth prir t Stage Tw Energizatin, the Intercnnectin Custmer is required t supply PJM with a test energy schedule f maximum daily utput MWs in rder fr PJM t Revisin: 12, Effective Date: 06/22/2017 PJM

36 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses determine any system cnstraints and t better crdinate Intercnnectin Custmer utage planning. Fr additinal infrmatin n test energy please review that sectin f Manual 14D Ntice f Cmpletin The Intercnnectin Custmer is required by sectin f the ICSA t ntify PJM and the applicable Transmissin Owner in writing upn cmpletin f the fllwing: The Custmer Facility The Intercnnectin Custmer Intercnnectin Facilities Any Transmissin Owner Facilities fr which the Intercnnectin Custmer has cmpleted thrugh exercising the Optin t Build alternative Attachment C cntains a template with suggested wrding fr the ntice f cmpletin Dcumentatin Required frm the Intercnnectin Custmer Prir t Synchrnizatin PJM Tariff, Attachment P, Appendix 2 Sectin 3.9 requires that the Intercnnectin Custmer prvide written dcumentatin transferring peratinal cntrl ver any Transmissin Owner Attachment Facilities that the Intercnnectin Custmer has cnstructed t the Transmissin Owner and PJM prir t synchrnizatin f the Custmer Facility with the transmissin system. Attachment C cntains a template with suggested wrding fr the transfer f peratinal cntrl. There are additinal dcumentatin requirements fr prjects that have elected Optin t Build. The details fr the submissin f the Optin t Build dcumentatin can be fund in that sectin f this dcument Dcumentatin Required frm the Transmissin Owner Prir t Synchrnizatin In accrdance with PJM Tariff Attachment P, Appendix 2, Sectin 3.8.5, the TO is required t prvide ntificatin f inspectin/testing results prir t synchrnizatin f the Custmer Facility with the transmissin system. Attachment C cntains a template with suggested wrding fr the ntificatin f inspectin/testing result. 3.9 Generatr As-Built Data Requirements In rder t reflect as-built infrmatin in PJM s planning mdels, PJM requires that Intercnnectin Custmers prvide updates t generatr data riginally prvided t PJM fr the initial planning studies. This as-built data is then used in the subsequent planning studies by PJM, s the accuracy f PJM s data is critical. The frm fr prviding the as-built generatr data can be fund n pjm.cm under the Planning sectin, RTEP Develpment, Expansin Planning Prcess tab in the Generatr As Is Study Data frm. The Intercnnectin Custmer is required t prvide PJM with the requested as-built electrical mdeling data (r dcumentatin that previusly submitted data is valid) within ne (1) mnth fllwing cmmercial peratin f the generating unit (s). As-built generatr data must be prvided fr each generating unit. Revisin: 12, Effective Date: 06/22/2017 PJM

37 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses 3.10 Dispute Reslutin Fr billing disputes, PJM will facilitate the dispute reslutin prcess with the Transmissin Owners and Intercnnectin Custmer in accrdance with the PJM Tariff, Attachment P, Appendix 2, Sectin 9. All ther types f disputes shall be submitted in accrdance with PJM Tariff, Attachment P, Appendix 2, Sectin 12. All disputes must be initiated in writing by a disputing party t PJM, and the PJM Intercnnectin Crdinatr will cnfirm that the dispute initiatin dcumentatin meets the PJM Tariff requirements, ntify the PJM Alternate Dispute Reslutin Cmmittee and PJM management, identify the apprpriate PJM Tariff dispute reslutin path that the disputed issue will fllw, and facilitate the prcess between the parties Breach, Cure and Default Breach is defined in Part I f the PJM Tariff at Sectin 1.3BB.01. A party fund in breach is prvided a ntice describing in reasnable detail the nature f the breach and, if applicable, any steps that will be necessary t cure the breach. The Breaching Party may clear the breach within 30 days r wrk in gd faith beynd the 30 day perid n all reasnable and apprpriate steps t clear the breach. Breaching Parties that d nt cure the breach will be fund in default f their agreement(s). Additinal details fr the Breach, Cure and Default prcess can be fund in the fllwing agreements: ISA, Appendix 2, Sectin 15 ICSA, Appendix 2, Sectin 13.0 UCSA, Appendix 2, Sectin 13.0 Additinally, Part I f the PJM Tariff, Sectin 1.7G defines Default Assignment A party t the intercnnectin agreements listed belw may make an assignment f their rights, duties and bligatins under the agreement in cnnectin with the sale, merger, r transfer f prperties per the prvisins f the agreement. Details fr the different frms f assignment can be fund in the fllwing agreements in the sectins identified: ISA, Appendix 2, Sectin 12 ICSA, Appendix 2, Sectin 10 WMPA, Appendix 2, Sectin 2.6 UCSA, Appendix 2, Sectin 10 Cnsent t assignment agreement templates can be fund n the PJM website at Revisin: 12, Effective Date: 06/22/2017 PJM

38 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 3: Generatin and Merchant Transmissin Agreement Implementatin Phase Prcesses 3.13 Prject Clseut The ICSA is cmpleted when the Custmer Facility makes a cmmercial energy sale r the facility s energy utput is used and all Transmissin Owner and Intercnnectin Custmer activities required per the applicable agreement have been cmpleted. At this pint the prject mves int the Operatin Phase (see Exhibit 2). The ISA remains in effect until it is terminated under sectin 16 f the Standard Terms and Cnditins in Appendix 2 f the ISA. Operatin phase crdinatin activities are handled by the PJM Client Management and Operatins Supprt Divisin and are detailed in PJM Manual 14D. Revisin: 12, Effective Date: 06/22/2017 PJM

39 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 4: Technical and Cnstructin Requirements Sectin 4: Technical and Cnstructin Requirements Welcme t the Technical and Cnstructin Requirements sectin f the PJM Manual fr Generatin and Merchant Transmissin Intercnnectin Facility Cnstructin. In this sectin yu will find an verview f bth the technical requirements fr generatr and merchant transmissin intercnnectins in the PJM regins and the cnstructin specificatins fr the attachment and Netwrk Facilities needed t accmmdate generatr and/r merchant transmissin intercnnectins in the PJM regins. Descriptin f the technical requirements and where t find the technical requirements f the particular Intercnnectin Transmissin Owner fr generatr and merchant transmissin intercnnectins in a specific PJM regin (see Transmissin Owner Standards ). Descriptin f the cnstructin standards and specificatins fr generatr Attachment Facilities and Netwrk Facilities and where t find the cnstructin standards fr a particular Intercnnectin Transmissin Owner t accmmdate generatr and/r merchant transmissin intercnnectins in a specific PJM regin (see Cnstructin Standards ). Descriptin f the technical requirements and where t find PJM s technical requirements is fund in the fllwing PJM manuals: M-01 M-03 M-14D 4.1 Transmissin Owner Standards Need fr Intercnnectin Technical Requirements The PJM Transmissin Grid prvides the means fr delivering the utput f intercnnected generatrs t the lad centers f the PJM energy and capacity markets. As a FERC accepted Reginal Transmissin Organizatin (RTO), PJM administers the prcess fr the intercnnectin f generatrs t the PJM Transmissin Grid. T ensure that the PJM Transmissin Grid is perated in a safe and reliable manner, all generatr and merchant transmissin prjects intercnnected t the PJM transmissin grid must be installed accrding t the established technical requirements fr gd utility practice. PJM, as the Transmissin Prvider, will ensure that the generatin and/r merchant transmissin Intercnnectin Custmer has access t the applicable technical requirements f the Intercnnected Transmissin Owner Applicatin f Intercnnectin Technical Requirements As specified in PJM Tariff Frm f Intercnnectin Cnstructin Service Agreement, Attachment P, Appendix 2, Sectin 2.2A, Applicable Technical Requirements and Standards shall apply t the design, prcurement, cnstructin and installatin f the Intercnnectin Facilities and Merchant A.C. Transmissin Facilities nly t the extent that the prvisins theref relate t the design, prcurement, cnstructin and/r installatin f such facilities. Such prvisins relating t the design, prcurement, cnstructin and/r installatin f facilities shall be identified in the Revisin: 12, Effective Date: 06/22/2017 PJM

40 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 4: Technical and Cnstructin Requirements Intercnnectin Cnstructin Service Agreement. The Intercnnectin Parties shall mutually agree upn, r in the absence f such agreement, Transmissin Prvider shall determine, which prvisins f the Applicable Technical Requirements and Standards shuld be identified in the Intercnnectin Cnstructin Service Agreement. In the event f any cnflict between the prvisins f the Applicable Technical Requirements and Standards that are appended t the Intercnnectin Cnstructin Service Agreement and any later-mdified prvisins that are stated in the pertinent PJM Manual, the prvisins appended t the Intercnnectin Cnstructin Service Agreement shall cntrl Technical Requirements n the PJM Website The PJM Tariff under Part I, Sectin 1.2C establishes the requirement that Thse certain technical requirements and standards applicable t intercnnectins f generatin and/r transmissin facilities shall be publicly available thrugh pstings n Transmissin Prvider s internet website. Accrdingly, PJM makes the dcuments cntaining Applicable Technical Requirements and Standards fr each Intercnnectin Transmissin Owner ( ITO ) available thrugh its internet website under the directry titled Design, Engineering & Cnstructin at Cnstructin Standards Need fr Cnstructin Standards The facilities f the PJM transmissin grid, while perated by PJM, are cmprised f the physical facilities wned by the varius Intercnnected Transmissin Owners ( ITOs ). While the facilities f the varius ITOs are perated by PJM as a fully intercnnected transmissin netwrk, the physical facilities f each individual ITO are designed t the particular cnstructin standards f that ITO. Such cnstructin standards fr a particular ITO include but are nt limited t: Transmissin system vltage levels Spacing and clearance requirements Equipment design specificatins Family f material and equipment sizes Fully cmpatible system prtectin schemes List f Apprved Cntractrs List f apprved manufacturers and vendrs f majr transmissin-related equipment While particular cnstructin standards may vary amng the varius ITOs, all such standards are derived frm thse generally accepted industry standards develped by the American Natinal Standards Institute (ANSI), the Institute f Electrical and Electrnics Engineers, Inc. (IEEE) and the Natinal Electric Safety Cde. The ITOs have selected their varius cnstructin standards t facilitate peratin, maintenance and repair r replacement f the varius cmpnents utilized n their prtin f the verall PJM Transmissin Grid. Thus, it is essential that any additins, upgrades r ther changes t the transmissin facilities f any particular ITO must be designed and installed t the cnstructin standards f that ITO. PJM, as the Transmissin Prvider, will ensure that any Cnstructing Entities authrized t perfrm cnstructin activities under the Optin t Build prvisins f the PJM Tariff t intercnnect Revisin: 12, Effective Date: 06/22/2017 PJM

41 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 4: Technical and Cnstructin Requirements with the facilities f an ITO r t install r upgrade facilities within the transmissin system f an ITO has access t the established cnstructin standards f that ITO Applicatin f ITO Cnstructin Standards The cnditins applicable t an Intercnnectin Custmer exercising its Optin t Build are specified in Attachment P, Appendix 2, Sectin f the PJM Tariff. Amng the prvisins included under the Optin t Build is: Intercnnectin Custmer shall submit t the Intercnnected Transmissin Owner and Transmissin Prvider initial drawings, certified by a prfessinal engineer, f the Transmissin Owner Intercnnectin Facilities and/r Merchant Netwrk Upgrades that Intercnnectin Custmer arranges t build under the Optin t Build. The Intercnnected Transmissin Owner and Transmissin Prvider shall review the drawings t assess the cnsistency f Intercnnectin Custmer s design f the pertinent Transmissin Owner Intercnnectin Facilities and/r merchant Netwrk Upgrades with Applicable Standards and the Facilities Study Cnstructin Standards n the PJM Website The PJM Tariff under Attachment P, Appendix 2, Sectin states that In the event that the Intercnnected Transmissin Owner and the Intercnnectin Custmer are unable t agree upn the terms f an Intercnnectin Cnstructin Service Agreement,... the Intercnnectin Custmer shall have the right, but nt the bligatin ( Optin t Build ), t design, prcure, cnstruct and install all r any prtin f the Transmissin Owner Intercnnectin Facilities and/r any Merchant Netwrk Upgrades. If a generatin and/r merchant transmissin Intercnnectin Custmer ( IC ) wishes t exercise the Optin t Build, the IC must have ready access t the cnstructin standards fr the ITO(s) system where such facilities are t be installed. Attachment P, Appendix 2, Sectin (a) f the PJM Tariff establishes the requirement that Transmissin Prvider shall publish each Transmissin Owner s List f Apprved Cntractrs in a PJM Manual and shall make such manual available n its internet website. Accrdingly, PJM makes the dcuments cntaining the applicable cnstructin standards fr each ITO available thrugh its internet website under the directry titled Design, Engineering & Cnstructin at Revisin: 12, Effective Date: 06/22/2017 PJM

42 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 5: Optin t Build Sectin 5: Optin t Build Welcme t the Optin t Build sectin f the PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin. In this sectin yu will find an verview f the additinal requirements related t implementatin f a prject that has elected the Optin t Build prvisin f the PJM Tariff. 5.1 Optin t Build The PJM Tariff allws fr an Intercnnectin Custmer t exercise the Optin t Build alternative during the ISA/ICSA executin phase. The PJM Tariff prvisins related t timeframes fr initiatin f the Optin t Build are utlined in PJM Manual 14A. Attachment D cntains a checklist f ptential prject dcumentatin mainly fcused twards Optin t Build prjects. These prjects have numerus pints in the prcess where ntices r infrmatin transfers are required Apprved Cntractrs and Manufacturers PJM will facilitate the prcess fr Transmissin Owners t prvide a List f Apprved Cntractrs and Manufacturers as required in accrdance with PJM Tariff, Attachment P, Appendix 2 Sectin PJM will facilitate the TO review, apprval/disapprval, and additin f cntractrs r manufacturers t the List f Apprved Cntractrs and manufacturers if requested by the Intercnnectin Custmer Drawing Review The Intercnnectin Custmer is required t prvide drawings certified by a prfessinal engineer f any Transmissin Owner Intercnnectin Facilities and/r Netwrk Upgrades being cnstructed under the Optin t Build prvisin f the ICSA t PJM and the Transmissin Owner. The Transmissin Owner will review and cmment n Intercnnectin Custmer drawings within 60 days after the receipt f drawings. PJM will facilitate and prvide versight fr this prcess. Drawings that are nt cmmented n within the 60 day perid are t be cnsidered apprved as-is. All drawings submitted are cnsidered Cnfidential Infrmatin Inspectin, Testing, and Energizatin Fr facilities built by the Intercnnectin Custmer, the PJM Tariff requires that the dcumentatin described belw be exchanged between the invlved parties prir t synchrnizatin f the Custmer Facility with the transmissin system. Attachment C cntains templates with suggested wrding fr the ntices belw. Additinally, the ntice and dcumentatin checklist lcated in Attachment D is used during prject implementatin t track the cmpletin f these items. Ntificatin f inspectin/testing results - Within 10 days after satisfactry inspectin and/r testing f Intercnnectin Facilities and/r Merchant Netwrk Upgrades built by the Intercnnectin Custmer (including, if applicable, inspectin and/r testing after crrectin f defects r failures), the Intercnnected Transmissin Owner shall cnfirm in writing t the Intercnnectin Custmer and Transmissin Prvider that the successfully Revisin: 12, Effective Date: 06/22/2017 PJM

43 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 5: Optin t Build inspected and tested facilities are acceptable fr energizatin (reference, PJM Tariff Attachment P, Appendix 2, Sectin 3.8.5) Transfer f peratinal cntrl - Prir t energizatin, the Intercnnectin Custmer shall have delivered t the Intercnnected Transmissin Owner and Transmissin Prvider a written ntice transferring t the Intercnnected Transmissin Owner and Transmissin Prvider peratinal cntrl ver any Transmissin Owner Attachment Facilities that Intercnnectin Custmer has cnstructed (reference, PJM Tariff Attachment P, Appendix 2, Sectins and 3.9.3). Acceptance f facilities - Within five days after determining that Intercnnectin Facilities and/r Merchant Netwrk Upgrades have been successfully energized, the Intercnnected Transmissin Owner shall issue a written ntice t the Intercnnectin Custmer accepting the Intercnnectin Facilities and/r Merchant Netwrk Upgrades built by the Intercnnectin Custmer that were successfully energized (reference, PJM Tariff Attachment P, Appendix 2, Sectin 3.10) Transfer f title dcumentatin Within 30 days after the receipt f the ntice f acceptance, the Intercnnectin Custmer shall deliver t the Intercnnected Transmissin Owner, fr the Intercnnected Transmissin Owner s review and apprval, all f the dcuments and filings necessary t transfer t the Intercnnected Transmissin Owner title t any Transmissin Owner Intercnnectin Facilities and/r Merchant Netwrk Upgrades cnstructed by the Intercnnectin Custmer, and t cnvey t the Intercnnected Transmissin Owner any easements and ther land rights t be granted by the Intercnnectin Custmer (reference, PJM Tariff Attachment P, Appendix 2, Sectin 5.5). Apprval f transfer f title dcumentatin The Intercnnected Transmissin Owner, after a review which is nt t be unreasnable withheld, delayed r cnditined, will prvide written ntice t the Intercnnectin Custmer f their apprval. 30 days after the receipt f the Intercnnected Transmissin Owner s apprval, the Intercnnectin Custmer shall execute all necessary dcumentatin and shall make all necessary filings t recrd and perfect the Intercnnected Transmissin Owner s title in such facilities and in the easements and ther land rights t be cnveyed t the Intercnnected Transmissin Owner (reference, PJM Tariff Attachment P, Appendix 2, Sectin 5.5). Revisin: 12, Effective Date: 06/22/2017 PJM

44 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Sectin 6: Baseline and Supplemental Upgrade Prjects Welcme t the Baseline and Supplemental Upgrade Prjects sectin f the PJM Manual fr Generatin and Transmissin Intercnnectin Facility Cnstructin. In this sectin yu will find the tracking prcess fr baseline and supplemental upgrade prjects. 6.1 Baseline Upgrade Prjects Baseline upgrades are prjects primarily required t eliminate base-case reliability criteria vilatins fund in the PJM Reginal Transmissin Expansin Plan. PJM assigns cnstructin respnsibility fr each baseline upgrade pursuant t Schedule 6 f the PJM Operating Agreement, Reginal Transmissin Expansin Planning Prtcl, which gverns the prcess fr planning the expansin and enhancement f transmissin facilities t meet reliability criteria and t enhance market efficiency. Upgrades are reviewed at the PJM Transmissin Expansin Advisry Cmmittee (TEAC) and then apprved by the PJM Bard. PJM sends each Transmissin Owner a letter cmmunicating the baseline upgrade cnstructin respnsibilities. The TO then acknwledges the letter and prvides any cmments back t PJM. Fr Greenfield prjects that are eligible t be designated t a nn-incumbent, PJM ntifies each Designated Entity f its designatin t cnstruct the baseline upgrade prject. The cnstructin designatin prcess fr baseline RTEP prjects is utlined in sectin f the PJM OA. Manual 14B detail the prcess fr identifying criteria vilatins, determining system upgrades t mitigate thse vilatins and the designatin f cnstructin respnsibility. Attachment F cntains the checklist fr the new equipment energizatin prcess t be utilized by Transmissin Owners and Designated Entities frm inceptin t energizatin f upgrade prjects RTEP Agreements Designated Entity Agreement (DEA) Greenfield transmissin prjects that riginate thrugh an RTEP prpsal windw will utilize the Designated Entity Agreement (DEA) t assign cnstructin respnsibility fr the identified prject t the Designated Entity. The Designated Entity Agreement is a tw party agreement between the Designated Entity and PJM. The terms and cnditins f the agreement gvern the cnstructin perid f the transmissin prject and define specific rights and bligatins f the parties. The frm fr the DEA can be fund in the PJM Tariff, Attachment KK. DEA Milestnes and Milestne Dates Milestnes are defined in Schedule C f the DEA. Milestnes prvide critical prject measuring pints and help cmmunicate t team members the timeframe and scpe f high level prject gals. The DEA is typically written t include the standard prject milestnes listed belw, but milestnes can be added r altered t custmize the agreement t suit the tracking needs f all invlved parties. Execute Intercnnectin Crdinatin Agreement - Designated Entity must execute the Intercnnectin Crdinatin Agreement with Transmissin Owner r request the agreement be filed unexecuted. Revisin: 12, Effective Date: 06/22/2017 PJM

45 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Demnstrate adequate Prject financing - Designated Entity must demnstrate that adequate prject financing has been secured. Prject financing must be maintained fr the term f the DEA. Acquisitin f all necessary federal, state, cunty, and lcal site permits Designated Entity must demnstrate that all required federal, state, cunty and lcal site permits have been acquired. Substantial site wrk cmpleted Designated Entity must demnstrate that at least 20% f Prject site cnstructin is cmpleted. Additinally the Designated Entity must submit updated ratings and the final prject drawings t the Transmissin Prvider. Demnstrate required ratings Designated Entity must demnstrate that the prject meets all required electrical ratings. Required prject in-service date - Designated Entity must: (i) demnstrate that the Prject is cmpleted in accrdance with the Scpe f Wrk in Schedules B f the DEA; (ii) meets the criteria utlined in Schedule D f the DEA; and (iii) is under Transmissin Prvider peratinal dispatch. A Designated Entity may request milestne extensins per the prject mdificatin prcess described in Sectin 4.3 f the DEA and detailed in this manual. Security The Designated Entity is required t supply prject security that is calculated as 3% f the PJM estimated csts fr the prtin f the transmissin prject being assigned t the Designated Entity. A Letter f Credit, which meets PJM criteria, r cash are acceptable frms f Security. Security is required t be maintained thrugh the term f the DEA Intercnnectin Crdinatin Agreement (ICA) The Intercnnectin Crdinatin Agreement (ICA) prvides fr the crdinatin required between the Designated Entity and Intercnnected Transmissin Owner(s) fr a greenfield transmissin prject selected thrugh an RTEP prpsal windw and was determined t require a DEA. The ICA is required in thse circumstances where the Designated Entity is nt a signatry t the Cnslidated Transmissin Owners Agreement (CTOA). The ICA frmalizes the crdinatin respnsibilities between the Transmissin Owner and Designated Entity during the cnstructin phase f the prject. There will be an ICA required with each different Transmissin Owner wh is required t crdinate wrk with the Designated Entity t facilitate the cnnectin f the identified transmissin prject t the system. The frm fr the ICA can be fund in the PJM Tariff, Attachment LL Tracking Once upgrades have been identified and apprved, the PJM Intercnnectin Crdinatr is respnsible fr tracking the status and cmpletin f prjects with the assistance f the Transmissin Owners and Designated Entities. Regular updates need t include the fllwing: General status f engineering and cnstructin Percent cmplete (reprt shuld fllw percent cmplete guidance given in the Schedule and Milestne Tracking sectin ) Revisin: 12, Effective Date: 06/22/2017 PJM

46 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Current target in-service date r actual cmpletin date Applicable utage infrmatin, in the frm f utage ticket numbers Cst update Nte: The PJM Tariff, Schedule 12 cntains cst allcatins fr baseline upgrade prjects. Nte: Statements f actual csts incurred n PJM baseline upgrades are a part f that entity s Attachment H filings t FERC under PJM s Tariff. This is pursuant t Sectin 205 f the Federal Pwer Act and Part 35 f the FERC regulatins and cmpleted in supprt f annual transmissin revenue requirements Prjects Subject t a Designated Entity Agreement Thse prjects subject t a Designated Entity Agreement (DEA) have additinal reprting requirements relative t the agreement milestnes as well as ther agreement prvisins discussed belw. This sectin describes the prcesses and agreement prvisins relevant t the implementatin phase f these prjects Prject Cmmunicatin, Reprting and Dcumentatin Quarterly Status Reprts The DEA, Sectin 4.4 requires that the Designated Entity prvide a quarterly (at a minimum) status reprt. The reprt is required t cntain, but nt be limited t the fllwing: Current engineering and cnstructin status Prject cmpletin percentage, including milestne cmpletin Current target prject r phase cmpletin date(s) Applicable utage infrmatin Cst expenditures t date and revised prjected cst estimates fr cmpletin Status f milestne cmpletin Prject Crdinatin Meetings Effective crdinatin between the Designated Entity, the intercnnectin Transmissin Owners and PJM shuld be achieved thrugh regular prject meetings. Prject meetings prvide the fllwing benefits: Effective cllabratin and cmmunicatin surrunding prject technical aspects Elevatin f prject issues with respect t schedule activities Efficient crdinatin f transmissin system utages Regular prject crdinatin meetings may be held in lieu f the Designated Entity s submitted quarterly status reprts. Revisin: 12, Effective Date: 06/22/2017 PJM

47 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Prject Financing Milestne The Designated Entity must demnstrate adequate financing per the milestne prvided in Schedule C f the DEA. One f the fllwing may be prvided as demnstratin f adequate financing: Firm cmmitment letter frm a financial institutin(s) r unaffiliated cmpany acceptable t PJM PJM may use existing PJM Tariff criteria fr acceptability f the financial institutin r the unaffiliated cmpany itself Cmmitment amunt must be apprpriate t the relevant phase f the prject financing plan and/r, Dcumentatin equivalent t abve Design Standards As described in sectin 4.0 f the DEA, the Designated Entity shall design, engineer, prcure, install and cnstruct, and maintain the prject in accrdance with applicable reliability principles, guidelines and standards, the Operating Agreement, and Gd Utility Practice. Minimum design standards, which have been develped by the Designated Entity Design Standards Taskfrce and apprved by the Planning Cmmittee, shall be psted n PJM s website and shall be applicable t prjects subject t a DEA. T the extent that that the wrk relates t the intercnnectin f the prject t Transmissin Owner facilities, the applicable technical requirements and standards f the Transmissin Owner t which the prject intercnnects with will apply. Technical requirements and standards f the Transmissin Owner(s) t whse facilities a prject will intercnnect must be psted n the PJM website and shall apply t all entities that wuld intercnnect t the Transmissin Owner s transmissin facilities. The Designated Entity s design standards wuld be applicable t the design f its facilities except where necessary fr crdinatin with the intercnnected facilities. All parties must crdinate the design and implementatin at the pint f intercnnectin fllwing the intercnnecting transmissin wner s psted applicable technical standards, r ther mutually agreed t slutin. When intercnnecting t multiple Transmissin Owners systems, all parties must crdinate t achieve a mutually agreed upn slutin. As discussed in Sectin 4 f this manual and as specified by the PJM Tariff Attachment P, Appendix 2, PJM Transmissin Owners are required t prvide t PJM the Transmissin Owner Applicable Technical Requirements and Standards alng with a List f Apprved Cntractrs. PJM makes this infrmatin available publically n PJM s website fr use by Intercnnectin Custmers and thers. If a Designated Entity is nt currently a PJM TO where such infrmatin is already psted, the Designated Entity shuld submit its applicable standards and list f vendrs and cntractrs t PJM fr review and psting within 18 mnths f executin f the DEA Upgrade Prject Mdificatin Prcess The DEA, Sectin prvides fr revisins t the prject scpe and schedule thrugh the prject mdificatin prcess. It is thrugh this prcess that the scpe, schedule r nn-standard terms and cnditins within the DEA are changed t reflect the evlutin f the prject thrugh the implementatin phase. The prject mdificatin prcess prvides fr a clear methd t dcument prject changes, which facilitates gd cmmunicatin and results in all parties being infrmed f changes in a timely manner. Revisin: 12, Effective Date: 06/22/2017 PJM

48 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects The prject mdificatin prcess is designed t have the flexibility t be initiated by the Designated Entity r PJM. The Upgrade Prject Designated Entity Agreement Mdificatin Frm can be fund in Attachment E. The fllwing are sme typical situatins where a Designated Entity r PJM may initiate the upgrade prject mdificatin prcess: DE initiated: Significant ruting change frm what has been prpsed Adjustments t where a line terminates within a substatin Significant electrical parameter changes PJM initiated: Changes driven frm RTEP analysis, such as a change in line terminatin psitins within a substatin r electrical parameter changes If the revisins captured by the scpe change prcess are deemed material t the prject, the DEA will be amended and refiled Breach, Cure, Re-Evaluatin and Default Breach is defined in Sectin 7.0 f the DEA. A party fund in breach is prvided a ntice describing in reasnable detail the nature f the breach and, if applicable, any steps that will be necessary t cure the breach. The breaching party may clear the breach within 30 days r wrk in gd faith beynd the 30 day perid n all reasnable and apprpriate steps t clear the breach in accrdance with Sectin 7.3 f the DEA. If the breach is nt cured, PJM will re-evaluate the prject per Schedule 6, Sectin 1.5.8(k) f the Operating Agreement. That analysis can result in ne f the fllwing: Retain the prject in the RTEP Remve the prject frm the RTEP Include an alternative prject in the RTEP If the prject is retained in the RTEP, PJM will determine if the prject designatin will remain with the current Designated Entity r be changed t the incumbent Transmissin Owner. Any RTEP change made relative t a prject re-evaluatin riginating frm a prject breach will be presented t the Transmissin Expansin Advisry Cmmittee and apprved by the PJM Bard Prject Clseut Prir t energizatin, the prject is required t submit as-built data t PJM and t demnstrate that all required electrical ratings have been achieved. The prject DEA and ICAs remain in effect until the fllwing prject gals have been reached: The Designated Entity executes the Cnslidated Transmissin Owners Agreement The prject has been cmpleted in accrdance with the terms and cnditins f the DEA The prject meets all relevant required planning criteria The prject is under Transmissin Prvider s peratinal dispatch Revisin: 12, Effective Date: 06/22/2017 PJM

49 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Prject Site Visit Baseline upgrades may be inspected during the cnstructin phase t determine schedule adherence, and pssibly after energizatin, t verify the as-built cnfiguratin matches the PJM system mdels Backbne Prjects Backbne upgrade prjects are transmissin system baseline RTEP prjects which have a majr impact n equipment and facilities at r abve 500kV and typically, but d nt always, span multiple Transmissin Owner znes. Due t their size, cmplexity, and impact t peratins and markets, backbne prjects are tracked mre clsely than typical baseline upgrade prjects and may have a dedicated webpage n pjm.cm used t cmmunicate prject status. The Backbne Prjects page can be fund in the Planning area under the RTEP Upgrades & Status tab Prject Spnsr Auctin Parameter Requirements Prject spnsrs f backbne upgrades are required t submit certain infrmatin t PJM prir t the prject being included in the planning parameters f a PJM Capacity auctin as specified in the PJM Tariff, Attachment DD, Sectin 5.11A. Fr PJM Base Residual Auctins (BRA), n later than 60 days befre the auctin parameters are psted the prject spnsr must: Submit a critical path prject schedule The prject schedule must demnstrate that the prject will be in service prir t the start f the Delivery Year The spnsr must certify that the schedule is reasnably achievable The schedule must als cntain, at a minimum, estimated cmpletin dates fr the fllwing tasks: Right-f-way acquisitin Engineering and design Equipment prcurement Cnstructin permitting Cnstructin activities Submit a list f certificates f public cnvenience required by the prject with the fllwing: A list f the states in which the prject is subject t the requirement t btain a certificate f public cnvenience and necessity r equivalent apprval A descriptin f the nature and current status f each apprval Fr PJM Incremental Auctins, n later than 60 days befre the auctin parameters are psted the prject spnsr must: Submit a critical path prject schedule. A prject schedule and list f certificates f public cnvenience must be prvided and meet all f the parameters given under the BRA schedule sectin abve. Revisin: 12, Effective Date: 06/22/2017 PJM

50 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Fr the First Incremental Auctin, a crprate fficer submits and certifies that the prject schedule demnstrates that 50% f the right-f-way, by linear distance, has been secured. Fr the Secnd Incremental Auctin, a crprate fficer submits and certifies that the prject schedule demnstrates that 75% f the right-f-way, by linear distance, has been secured. Fr the Third Incremental Auctin, a crprate fficer submits and certifies that the prject schedule demnstrates that 100% f the right-f-way, by linear distance, has been secured. N later than 30 days prir t the applicable auctin, PJM r an independent third party will audit the prject schedule and affirm if that it is reasnable and the prject remains n target t meet the in-service date. The audit may include site visits as necessary Upgrade Delays If a baseline upgrade is nt cmplete by the PJM required date, the respnsible Transmissin Owner is required t develp a plan t cmplete the wrk. PJM Intercnnectin Planning will make a risk assessment and determine if any cntrlling actins r cntingency plans need t be put in place t mitigate criteria vilatins. PJM Markets will be made aware if the prject s delay has ptential significant ecnmic r cngestin related impacts Cst Changes Significant cst increases t baseline upgrades can change the analysis dne t slve criteria vilatins and need t be cmmunicated t PJM as they are discvered. PJM will use the new cst data t re-analyze the criteria vilatin and determine if a different, mre ecnmical slutin is better suited t slve the issue Cmpletin Upn cmpletin f a baseline upgrade, the Transmissin Owner ntifies PJM that the agreed upn reslutin t the criteria vilatin has been cmpleted. Additinally, the Transmissin Owner is required t ensure the fllwing items are cmpleted: Equipment tplgy and cntingency mdel infrmatin is submitted t PJM per Manual M03A If necessary, new ratings have been submitted t PJM Date f baseline upgrade cmpletin cmmunicated t PJM If necessary, update PJM Operatinal Manual Supplemental Upgrade Prjects Supplemental upgrades are prjects riginated by the Transmissin Owner that are nt driven by an applicable PJM criterin. These prjects are used as inputs t the RTEP mdels. There is a FERC requirement that any system upgrade(s) t the bulk electric system be presented at a public meeting and s, these upgrades are discussed at a PJM TEAC meeting. Attachment F cntains the checklist fr the new equipment energizatin prcess t be utilized by Transmissin Owners frm inceptin t energizatin f supplemental prjects. Revisin: 12, Effective Date: 06/22/2017 PJM

51 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Sectin 6: Baseline and Supplemental Upgrade Prjects Tracking The PJM Intercnnectin Crdinatr is respnsible fr tracking the cmpletin f supplemental upgrades. Regular updates frm the Transmissin Owner need t include the fllwing: General status f engineering and cnstructin Percent cmplete (Transmissin Owners shuld fllw percent cmplete guidance given in the Schedule and Milestne Tracking sectin) Current target in-service date r actual cmpletin date Upgrade Delays If a supplemental upgrade is nt cmpleted by the riginally frecasted date, the respnsible Transmissin Owner is required t validate that n criteria vilatins are caused by the delay in the current r future planning years. Additinally, PJM must be ntified f the delay and the new target date t ensure that the apprpriate planning mdels are updated and analyzed fr any reliability vilatins. Reliability vilatins fund in this analysis will lead t the creatin f baseline upgrades Cmpletin Upn cmpletin f a supplemental upgrade, the Transmissin Owner ntifies PJM that the agreed upn reslutin t the criteria vilatin has been cmpleted. Additinally, the Transmissin Owner is required t ensure the fllwing items are cmpleted: Equipment tplgy and cntingency mdel infrmatin is submitted t PJM per Manual M03A New ratings have been submitted t PJM Date f supplemental upgrade cmpletin cmmunicated t PJM If necessary, update PJM Operatinal Manual 03 Revisin: 12, Effective Date: 06/22/2017 PJM

52 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment A: Transmissin Owner Standard Invice Frm F Attachment A: Transmissin Owner Standard Invice Frm F Attachment A includes the PJM Transmissin Owner Standard Invice Frm F used during the ISA/ICSA implementatin phase. Transmissin Owners submit a cmpleted Frm F fr each Attachment Facility item (queue number) and each respective Netwrk Upgrade (Netwrk Upgrade number) in additin t the Transmissin Owner invice cver sheets. Nte that the clumns marked Present Allcatin and Reallcatin are fr PJM use nly and shuld nt be filled in by the Transmissin Owner. Invices submitted by Transmissin Owners withut the apprpriate frms attached will be returned t the Transmissin Owner unprcessed. Additinal supprting details may be prvided, but the attached invice frm is designed t be used by Transmissin Owners as the minimum supprting dcumentatin fr Transmissin Owner invice cver sheets. Exhibit 3: Transmissin Owner Standard Invice Frm F Revisin: 12, Effective Date: 06/22/2017 PJM

53 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment A: Transmissin Owner Standard Invice Frm F Exhibit 4: Example f ISA/ICSA Phase Quarterly Cst Recnciliatin Revisin: 12, Effective Date: 06/22/2017 PJM

54 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment B: Generatr and Merchant Transmissin Prject Agreement Scpe Change Frm Attachment B: Generatr and Merchant Transmissin Prject Agreement Scpe Change Frm Exhibit 5: Generatr and Merchant Transmissin Prject Agreement Scpe Change Frm Revisin: 12, Effective Date: 06/22/2017 PJM

55 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment C: Ntificatin Templates Attachment C: Ntificatin Templates Ntificatin f Suspensin Fr ICSA (suggested wrding): Ntice f Suspensin in reference t PJM Queue psitin [XX-XXX] By issuance f this dcument, [INTERCONNECTION CUSTOMER] hereby ntifies PJM, effective this [DATE] that are requesting the [TRANSMISSION OWNER(S)] t suspend all wrk under the Specificatins sectin f the ICSA, Appendix II, Sectin 3.4. This request fr suspensin is due t the fllwing reasn(s): [PROVIDE EXPLANATION FOR SUSPENSION HERE]. It is expected that the perid f suspensin shuld last fr [ENTER EXPECTED DURATION OF SUSPENION HERE]. The entity submitting this frm attests that they have similarly ntified the afrementined Transmissin Owner f this request fr suspensin as f [DATE]. The entity submitting this frm acknwledges that under the PJM Tariff, Attachment P, Appendix 2, Sectin 3.4.2, it is the their respnsibility t ntify PJM and the TO t re-initiate prject wrk prir t the expiratin f available suspensin time. Failure t prvide written ntice befre the end f the suspensin time perid will result in the prject being terminated. Under these circumstances, the Intercnnectin Crdinatr will send the terminatin letter t the Intercnnectin Custmer with a cpy als sent t the TO. Furthermre, unless written ntice is prvided as stated, this ntice f suspensin will remain in effect regardless f the estimated duratin specified abve. Ntificatin f Suspensin Fr WMPA (suggested wrding): Ntice f Suspensin in reference t PJM Queue psitin [XX-XXX] By issuance f this dcument, [INTERCONNECTION CUSTOMER] hereby ntifies PJM, effective this [DATE] that are requesting the [TRANSMISSION OWNER(S)] t suspend per Article 3, Sectin 3.1. This request fr suspensin is due t the fllwing reasn(s): [PROVIDE EXPLANATION FOR SUSPENSION HERE]. It is expected that the perid f suspensin shuld last fr [ENTER EXPECTED DURATION OF SUSPENION HERE]. The entity submitting this frm attests that they have similarly entered int suspensin with the afrementined Transmissin Owner as f [DATE]. The entity submitting this frm acknwledges that under the PJM Tariff, Attachment P, Appendix 2, Sectin 3.4.2, it is the prject s respnsibility t ntify PJM and the TO t re-initiate prject wrk prir t the expiratin f available suspensin time. Failure t prvide written ntice befre the end f the suspensin time perid will result in the prject being terminated. Under these circumstances, the Intercnnectin Crdinatr will send the terminatin letter t the Revisin: 12, Effective Date: 06/22/2017 PJM

56 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment C: Ntificatin Templates Intercnnectin Custmer with a cpy als sent t the TO. Furthermre, unless written ntice is prvided as stated, this ntice f suspensin will remain in effect regardless f the estimated duratin specified abve. Ntificatin f Recmmencement f Cnstructin Frm Suspensin (Suggested wrding): Ntice f Recmmencement f Cnstructin frm Suspensin in reference t PJM Queue psitin [XX-XXX] By issuance f this dcument, [INTERCONNECTION CUSTOMER] hereby ntifies PJM, effective this [DATE] that are requesting the [TRANSMISSION OWNER(S)] t recmmence all wrk, previusly suspend as f [DATE PROJECT WAS PREVIOUSLY SUSPENDED] under this PJM Queue psitin. The entity submitting this frm attests that they have similarly ntified the afrementined Transmissin Owner(s) f the recmmencement f cnstructin as f [DATE]. Ntificatin f Cmpletin (Suggested wrding): Ntice f Cmpletin in reference t PJM Queue psitin [XX-XXX] By issuance f this dcument, ([INTERCONNECTION CUSTOMER]) hereby ntifies [TRANSMISSION OWNER] that cnstructin is cmplete fr [DESCRIPTION OF FACILITIES] built by ([INTERCONNECTION CUSTOMER]). PJM Queue Psitin [XX-XXX] has the requirement t prvide written dcumentatin f the cmpleted [DESCRIPTION OF FACILITIES] pursuant t Sectin f Attachment P, Appendix 2, Standard Cnstructin Terms and Cnditins as cntained in PJM's Open Access Transmissin Tariff. Ntificatin f Inspectin/Testing Results (Suggested wrding): By issuance f this dcument, the [TRANSMISSION OWNER] hereby acknwledges the preenergizatin acceptance f the [NAME] intercnnectin substatin (PJM Queue Psitin [XX]) built by the Intercnnectin Custmer ([DEVELOPER]). PJM Queue Psitin [XX] fr the [NAME OF FACILITY] has the requirement t prvide written dcumentatin f the cmpleted inspectin and testing fr the [NAME] intercnnectin substatin, pursuant t Sectin f Attachment P, Appendix 2, Standard Cnstructin Terms and Cnditins as cntained in PJM's Open Access Transmissin Tariff. A site walkdwn was cnducted n [DATE] and a punch list f actin items has been cmpiled. Unreslved punch list items still need t be reslved but d nt impact energizatin. Preenergizatin cmmissining and testing has been satisfactrily perfrmed. Fllw-up energizatin testing will be perfrmed after the line recnfiguratin wrk is cmpleted. Transfer f Operatinal Cntrl (Suggested wrding): Revisin: 12, Effective Date: 06/22/2017 PJM

57 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment C: Ntificatin Templates PJM Queue Psitin [XX] fr the [NAME OF FACILITY] des, as required pursuant t Sectin and f Attachment P, Appendix 2, Standard Cnstructin Terms and Cnditins cntained in PJM's Open Access Transmissin Tariff, hereby transfer t [TRANSMISSION OWNER] peratinal cntrl f the [NAME] intercnnectin substatin as f the date written belw. [DEVELOPER] has delivered prir t this written instrument f transfer, the markedup as-built drawings f the [NAME] intercnnectin substatin. [DEVELOPER] will ensure telemetering systems are peratinal and prvide PJM and [TRANSMISSION OWNER] with telemetered data as specified in PJM Tariff attachment O, appendix 2, sectin befre Stage Tw energizatin (initial synchrnizatin f any generatrs). Acceptance f Facilities (Suggested wrding): By issuance f this dcument, the Intercnnected Transmissin Owner [TRANSMISSION OWNER NAME], hereby acknwledges the acceptance f the facilities f the [NAME] Intercnnectin Switching Statin and Transmissin Tap built by the Intercnnectin Custmer, [DEVELOPER NAME]. PJM requires written dcumentatin f the acceptance f facilities cnstructed by the Intercnnectin Custmer, pursuant t Sectin 3.10 f Attachment P, Appendix 2, Standard Cnstructin Terms and Cnditins as cntained in the PJM Tariff. These facilities were energized n [DATE] and punch list items frm the site inspectin f [DATE] have been reslved. Transfer f Title (Suggested wrding): RE: Transfer t [TRANSMISSION OWNER] f the [NAME OF FACILITY] (PJM Queue Psitin [QUEUE NUMBER]) PJM Queue Psitin [QUEUE NUMBER] fr the [INTERCONNECTION CUSTOMER FACILITY] des, required pursuant t PJM Tariff attachment P, appendix 2, sectin 5.5, hereby transfer t [TRANSMISSION OWNER] the [NAME OF FACILITY] as f the date written belw. [INTERCONNECTION CUSTOMER] transfer f Facilities requires a Bill f Sale t transfer and cnvey t [TRANSMISSION OWNER] certain items f persnal prperty as hereinafter described. Facilities transferred list includes: Descriptin Quantity Supplier Catalgue Number Item reference t Bill f Material Bill f Sale (Suggested wrding): Revisin: 12, Effective Date: 06/22/2017 PJM

58 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment C: Ntificatin Templates This Bill f Sale is made as f DATE ("Effective Date") by [INTERCONNECTION CUSTOMER FACILITY] t [TRANSMISSION OWNER]. Witnesseth: Whereas, [INTERCONNECTION CUSTOMER] and [TRANSMISSION OWNER] are parties t that certain Easement Agreement ("Easement Agreement"), dated DATE, with respect t certain real prperty lcated in XXX, as described therein ("Prperty"); Whereas, pursuant t the terms f this Bill f Sale, [INTERCONNECTION CUSTOMER] desires t transfer and cnvey t [TRANSMISSION OWNER] certain items f persnal prperty as hereinafter described. Nw, therefre, fr gd and valuable cnsideratin, the receipt and sufficiency f which are hereby acknwledged, effective as f the Effective Date, [INTERCONNECTION CUSTOMER] des hereby Grant, Sell, Transfer, Set Over, and Deliver t [TRANSMISSION OWNER], all f the equipment, facilities, and ther persnal prperties lcated at the Prperty, including withut limitatin the persnal prperty mre particularly described n the facilities transferred list attached heret and incrprated herein by this reference ("Persnal Prperty"), free and clear f any and all liens, security interests and encumbrances. [INTERCONNECTION CUSTOMER] hereby represents and warrants t [TRANSMISSION OWNER], that [INTERCONNECTION CUSTOMER] is the sle lawful wner f the Persnal Prperty; that [INTERCONNECTION CUSTOMER] has gd and marketable title t the Persnal Prperty free and clear f all liens, claims, rights, charges, r encumbrances f any nature whatsever; and that [INTERCONNECTION CUSTOMER] has the right t transfer the Persnal Prperty t [TRANSMISSION OWNER] as afresaid. Ntwithstanding anything herein t the cntrary, [INTERCONNECTION CUSTOMER] hereby cvenants and agrees fr the benefit f [TRANSMISSION OWNER] that [INTERCONNECTION CUSTOMER] will, fr [INTERCONNECTION CUSTOMER] and [INTERCONNECTION CUSTOMER]'s successrs and assigns, warrant and frever defend, at [INTERCONNECTION CUSTOMER]'s sle cst and expense, the right, title, and interest f [TRANSMISSION OWNER] and [TRANSMISSION OWNER] s successrs and assigns in and t the Persnal Prperty against the lawful claims and demands f all persns. The prvisins f this paragraph shall apply ntwithstanding any ther prvisins f this Bill f Sale r the Easement Agreement, and shall survive terminatin, cancellatin, r cmpletin f this Bill f Sale and the Easement Agreement. This Bill f Sale shall be gverned by, interpreted under and cnstrued and enfrceable in accrdance with the laws f the State/Cmmnwealth f [STATE]. This Bill f Sale may be executed in cunterparts, each f which shall be an riginal and all f which cunterparts taken tgether shall cnstitute ne and the same agreement. Revisin: 12, Effective Date: 06/22/2017 PJM

59 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment C: Ntificatin Templates In witness wheref, [INTERCONNECTION CUSTOMER] has caused this Bill f Sale t be duly executed and delivered as f the date and year first abve written. Signature f [INTERCONNECTION CUSTOMER] Revisin: 12, Effective Date: 06/22/2017 PJM

60 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment D: Ntice and Dcumentatin Checklist Attachment D: Ntice and Dcumentatin Checklist Exhibit 6: Ntice and Dcumentatin Checklist Revisin: 12, Effective Date: 06/22/2017 PJM

61 PJM Manual 14C: Generatin and Transmissin Intercnnectin Facility Cnstructin Attachment E: Upgrade Prject Designated Entity Agreement Mdificatin Frm Attachment E: Upgrade Prject Designated Entity Agreement Mdificatin Frm Exhibit 7: Upgrade Prject Designated Entity Agreement Mdificatin Frm Revisin: 12, Effective Date: 06/22/2017 PJM