2nd DRAFT Republic of the Philippines ENERGY REGULATORY COMMISSION San Miguel Avenue, Pasig City ERC RULES SUPPLEMENTING THE SWITCHING AND BILLING PROCESS AND ADOPTING A DISCONNECTION POLICY FOR THE CONTESTABLE CUSTOMERS. ERC CASE NO. __ RM Pursuant to Sections 29, 31, 43 and 45 of Republic Act No. 9136, hereinafter referred to as the Act, its Implementing Rules and Regulations (IRR), the Energy Regulatory Commission (ERC) hereby adopts and promulgates the ERC Rules Supplementing the Switching and Billing Process and Adopting a Disconnection Policy for Contestable Customers”, referred to as “the Supplemental Switching Rules”. ARTICLE I GENERAL PROVISIONS Section 1, Objectives The Supplemental Switching Rules shall have the following objectives: a. To provide supplementary procedures on the customer switching method and ensure its effective implementation; b. To ensure the efficient and timely exchange of information between and among competitive retail market participants; and c. To provide applicable billing procedures and disconnection process for contestable customers, Page tof 19Section 2. Scope and DRAFT These Rules shall apply to the following: . Contestable Market; meaeop . Retail Electricity Suppliers (RES’); Distribution Utilities (DUs); |. Suppliers of Last Resort (SOLRs); .. The Central Registration Body (CRB); and, All other relevant industry participants. Section 3. Definition of Terms Act Business Day Central Registration Body Contestable Customer Republic Act No. 9136, otherwise known as “Electric Power Industry Reform Act of 2001”, and_ its Implementing Rules and Regulations (IRR). A day other than a Saturday, a Sunday or an official or declared Philippine national or local public holiday. An independent entity assigned to undertake the required processes, information technology, and other systems capable of handling customer switching and information exchange among retail electricity market participants. An electricity End-user which belongs to the Contestable Market. An aggregate of Contestable Customers organized under succeeding phases of retail competition and open access shall be considered as a_ single Contestable Customer, unless otherwise provided by the ERC. Page 2 of19Contestable Market Distribution Services and Open Access Rules (DSOAR) Distribution Utility Distribution Wheeling Service (ws) Distribution ‘Wheeling Service Agreement (DWSA) Dual/Multiple Billing End-user 2nd DRAFT The electricity end-users who have a choice of a supplier of electricity, as may be determined by the ERC in accordance with the Act. ‘The set of rules promulgated by the ERC regarding the provision of regulated services by a DU to entities such as captive and contestable customers, RES, other DUs, generation companies, under the environment created by the Act. Any electric cooperative, private corporation, government-owned utility or existing local government unit which has an exclusive franchise to operate a distribution system in accordance with its franchise and the Act, including DUs operating in the Economic Zones. The conveyance of power throughout a distribution system to meet. the demand of end-users. ‘An agreement between a DU and a RES, or SOLR on behalf of a Customer, or between a DU and a Customer, for the procurement of Dws. A. billing system whereby a Contestable Customer __ receives separate bills from its RES, WESM (if applicable) and from its Network Service Provider. Any person or entity requiring the supply and delivery of electricity for Pages of19,Energy Regulatory Commission (ERC) Local Retail Electricity Supplier (Local RES) National Grid Corporation of the Philippines (NGCP) Network Service Provider Primary RES Retail Electricity Supplier (RES) and DRAFT its own use. The independent and quasi-judicial regulatory agency created under Section 38 of the Act. The non-regulated business segment of the DU authorized by the ERC to supply electricity to the Contestable Customers within the DU’s franchise area only, or Persons authorized by appropriate entities to supply electricity within their respective economic zones. As Local RES, the DU is not required to secure a supplier's license. The corporation awarded the concession to operate the transmission facilities of the National Transmission Corporation pursuant to the Act and Republic Act No. 9511. An entity which engages in the activity of owning, controlling, or operating a transmission or distribution system. The RES nominated and assigned by the contestable customer, in writing, as the single point of contact for the CRB and all Network Service Providers. In case of single billing, it shall be responsible for billing and collecting from the contestable customer all applicable charges by other Network Service Providers. ‘Any person or entity authorized by the ERC to sell, broker, market or aggregate electricity to end-users in Pageaofi9Retail Supply Contract Single Billing Supplier of Last Resort Switch Request Switch or Switching Wholesale Electricity Spot Market (WESM) 20d DRAFT the Contestable Market. Unless otherwise provided, all references to the RES herein shall include the Local RES. The contract for the sale of electricity entered into by and between the RES and the Contestable Customer. A billing system whereby a Contestable Customer receives only one consolidated bill issued by a RES. A regulated entity designated by the ERC to serve End-users in the Contestable Market following a Last Resort Supply Event; A request sent by a prospective RES for the CRB to switch a Contestable Customer from its RES. The commercial transfer of a Contestable Customer from one supplier to another, which takes effect on the regular meter reading date or on a special meter reading date following a Last Resort Supply Event. The Wholesale Electricity Spot Market established by the Department of Energy (DOE) pursuant to the Act. Words and phrases used in this Rules which are defined in the Act or the IRR have the same meaning given to them in the Act or the IRR. Page 5 of19Section 1. Section 2. 2nd DRAFT ARTICLE IT SWITCH PROCESS Switching of a Contestable Customer to a RES of its choice shall take effect subject to the supplementary conditions and procedures provided hereunder: a. No Contestable Customer shall be allowed to Switch or be supplied by a new RES or SOLR should it have an outstanding balance with its supplier on its regular bill. Whether under dispute or not, the Contestable Customer shall be required to settle its outstanding balance prior to Switching. For purposes of these Rules, outstanding balance shall refer to the amount due under previous unpaid bills including the amount indicated in its current bill. Should the payment of a security deposit be required as stated in the RSC, the Contestable Customer shall pay the corresponding deposit to the prospective RES upon receipt of a Switch approval from the RES. b. A Contestable Customer which is about to Switch to another RES, and which has been required to put up a cash security deposit by its incumbent RES shall be entitled to the refund of the said amount plus the applicable interest earned (interest earnings net of tax of the amount in escrow) less outstanding balance. The concerned RES shall refund the amount to the Contestable Customer within thirty (30) days from effective Switch. c. A Contestable Customer which is about to migrate to the CREM, shall be entitled to the refund of the bill deposit from its DU in accordance with Section 3.4.2, Article UI of the DSOAR. The DU shall be the default meter service provider for the retail market until such time that the ERC determines the provision of metering services at the retail level to be competitive. For purposes of these Rules, meter service Pages ofaSection 1. Section 2. Section 3. Section 4. and DRAFT shall include procurement of ‘meter on behalf of a Contestable Customer, meter installation, maintenance, repair, calibration with the supervision of ERC, meter reading, including data dissemination to the CRB. The NGCP shall be the default meter service provider for the directly-connected Contestable Customer. The NGCP, as the owner of the revenue meters, shall be responsible for data dissemination and metering. services. Despite any existing arrangement by the DU with NGCP on the matter of meter service to the directly-connected Contestable Customer, NGCP shall still be considered as the meter service provider, in accordance with Resolution No. 15, Series of 2011 entitled “A Resolution Adopting The Amended Rules for the Approval of the Sale and Transfer of TRANSCO’s Subtransmission Assets and the Acquisition by Qualified Consortiums”. ARTICLE IIL BILLING AND PAYMENTS A Contestable Customer registered as a Direct Member of the WESM may choose from single or dual/multiple billing schemes: Provided, That said customer maintain the chosen billing option for at least one (1) year and such should be stipulated in its RSC with the RES. Neither the DU, NGCP nor the RES shall impose any charges on a Contestable Customer for changing its billing method. Under the single billing scheme, the Contestable Customer shall receive one consolidated bill from the RES reflecting all charges including the approved wheeling charges, described in Section 5.4 hereof, from the Network Service Provider. Should a contestable customer opt to change its billing services, the following provisions shall apply: Page7of192nd DRAFT p A Contestable Customer shall send a request for a change in billing to its incumbent RES to the chosen billing option, at least thirty (30) days prior to the start of the intended billing period covered; b. The RES shall send the request for a change in billing to the Network Service Provider within twenty four (24) hours from receipt of request from the Contestable Customer. However, such request should have been received by the Network Service Provider at least fifteen (15) days prior to the scheduled meter reading date; ¢. The Network Service Provider shall provide a response for change in billing to the RES within forty eight (48) hours indicating acceptance thereof and the effective date of the change in billing option; d. The RES shall notify the Contestable Customer within twenty four (24) hours from receipt of response for change in billing. Section 5. Bill Content SA The RES’ bills’ shall be in clear and simple language, and shall, among others, contain the following: a. RES’ customer service address, email and telephone number; b. Address, telephone number and email addresses of the ERC; and c. Network service provider's customer service and. emergency telephone numbers. The RES’ bills shall also contain sufficient information to allow Contestable Customers the ability to calculate their charges, such as but not limited to: the kWh usage for the indicated billing period, the billing date (due date), remaining balance and payments applied. Page 8 of 1953 54 2nd DRAFT If optional services (added-value services) are provided, the associated charges shall be itemized separately on the Contestable Customer's bill. Should a Contestable Customer opt for a single billing scheme, the bill by the RES to Contestable Customer shall contain the following: RES Charges Generation Charge Supplier's Charge Government Taxes TOTAL RES CHARGES Distribution Wheeling Service (DWS) Charges Transmission Charge Distribution Charge Standard Connection Charge Supply Charge Metering Charge System Loss Charge Local Franchise Tax Senior Citizen Discount, if applicable Lifeline Subsidy VAT Universal Charge FIT-ALL Charge; and Other Charges and Adjustments approved by the ERC. TOTAL DU CHARGES TOTAL ELECTRICITY BILL The RES merely acts as a collecting agent for the DWS charges in behalf of the Network Service Provider. Such DWS charges are pass-through charges by the DU, NGCP/TransCo and Power Sector Assets and Liabilities Management (PSALM) Corporation based on rates previously approved by the ERC. These charges which include the transmission for NGCP, FIT-All for TransCo, universal charge for PSALM and other adjustments in behalf of the Network Service Providers. Section 6. Payment Processing and Remittance Page of 1963 6.4 and DRAFT The RES or multiple RES shall supply the entire requirements of the Contestable Customer subject to the pricing methodology specified in their RSC, and the former shall remit all amounts due to Network Service Providers and other payees within the timeframe specified in their respective agreements to avoid disconnection of service. The RES may impose late payment charges on the Contestable Customer for unpaid amounts: Provided, that the terms of the late payment charges are stated in the RSC and previously disclosed to the Contestable Customer. The RES shall remit wheeling service payments to the Network Service Provider within the timeframe specified in their billing agreement by use of electronic funds transfer, bank-to-bank * transfers, or any other means agreed upon by both parties. Should payment by the Contestable Customer be made through check and the same is returned for any reason, the RES or SOLR may charge the Contestable Customer for the return fee and any reasonable administrative fee, in addition to late payment charges. Should the RES fail to remit to the Network Service Provider the Contestable Customer payments within the timeframe specified in its billing agreement, the RES shall pay interest on the un-remitted amount. The Network Service Provider shall calculate the late payment charges based on the approved surcharge by the ERC for late payments from the date the payment was due to be received by the Network Service Provider. ARTICLE IV DUAL BILLING SCHEME Section 1. The Network Service Provider, RES and/or WESM, if applicable, shall render separate bills directly to the Contestable Customer. The Contestable Customer shall pay the Network Service Provider and the RES and/or WESM separately within the timeframe specified in their respective RSCs, wheeling agreement and applicable rules. Pages0 of 19Section 2. Section 3. Section 4. Section 5. 2nd DRAFT The Contestable Customer shall have the responsibility to: (1) contract with the RES and/or procure from WESM for its electricity requirements; (2) contract directly with the Network Service Providers for the wheeling agreement; and (3) submit the Switching requirements to the CRB. The DWSA pro-forma contract to be adopted by the DU and the Direct WESM member Contestable Customer is hereto attached as Annex “A”. The Contestable Customer shall send wheeling service payments to the Network Service Provider within the timeframe specified in their billing agreement by use of electronic funds transfer, bank-to-bank transfers, or any other means agreed upon by both parties. , Should the Contestable Customer fail to pay the Network Service Provider, said Contestable Customer shall be liable for payment of the applicable surcharge. The Network Service Provider ‘shall calculate the late payment charges based on the previously approved surcharge by the ERC for late payments from the date the payment was due to be received by the Network Service Provider. Should the Contestable Customer fail to pay any amount due and owing to the RES/WESM, and the default has not been remedied on or before the expiry of the agreed termination period, the concerned RES/WESM may send at least 48- hour request for disconnection to the Network Service Provider, and the latter shall send notice of disconnection to the RES’ affected Contestable Customers. For Contestable Customer with updated payment to its RES or WESM, but fails to pay the Network Service Provider, the latter shall send notification to the concerned RES or WESM and to the affected Contestable Customers, prior to disconnection. Page sn 019,20 DRAFT Section 6. A Contestable Customer under the dual billing scheme shall receive a bill from the RES containing, at least, the following: RES Charges Generation Charge ‘Supplier's Charge Government Taxes TOTAL RES CHARGES ARTICLE V DISCONNECTION/RECONNECTION PROCESS Section 1. A Contestable Customer service shall be subject to disconnection upon occurrence of any of the following and subject to the procedures stated hereunder: a) Failure of the RES to settle its balances with the Network Service Provider as they fall due, in accordance with the DWS agreement and applicable rules. i. iii, In the event a RES fails to pay for DWS by the due date prescribed for the service, the DU shall notify the RES that service under the DWS agreement will be terminated which should not be less than seven (7) business days from the RES’ receipt of the notice to such effect.. Should. the RES fail to pay within forty eight (48) hours following said notice, the DU shall send a copy of the notice of disconnection to the affected Contestable Customers of the RES. Prior to termination of service under the DWS agreement, the Contestable Customer must either make arrangements or acquire supply from another RES or temporarily acquire service as a SOLR customer to avoid disconnection, except for Direct WESM Members where they may source all of their electricity requireménts from the WESM. . If upon termination of service under the RES DWS agreement, the Contestable Customer has not acquired service from another RES or the SOLR, the DU shall have the right to disconnect such customer. Pagerzofi92nd DRAFT v. If at the time the disconnection is to be made, the RES tenders full payment of the unpaid bill to the DU, the latter shall desist from disconnecting the,service. b) Failure of the Contestable Customer to pay the RES, WESM (if applicable) and the Network Service Provider. i. In the event that a Contestable Customer fails to pay the DWS by the due date, a notice of disconnection which should not be less than forty eight (48) hours shall be sent to the Contestable Customer. i. In the event that a Contestable Customer fails to pay the RES for the supply of electricity by the due date, the RES may send a request for disconnection to the Contestable Customer. Should the Contestable Customer fails to pay the RES or WESM within the set period; the Network Service Provider shall disconnect the Contestable Customer within twenty four (24) hours from receipt of request for disconnection from the RES or WESM (if applicable), and notify the RES and PEMC, as the CRB and as the operator of the WESM (if applicable) within one (1) hour that the Contestable Customer has been disconnected. .If at the time the disconnection is to be made, the Contestable Customer tenders full payment of the unpaid bill to the Network Service Provider, the latter shall desist from disconnecting the service. iii c) The RES shall be held liable in case the Contestable Customer disputes the disconnection made by the DU and the objection is found to be meritorious. d) Failure of the Contestable Customer and/or RES to comply with the financial and technical obligations under the Open Access Transmission Service Rules (OATS Rules), Distribution Service and Open Access Rules (DSOAR), Philippine Grid Code, Philippine Distribution Code, WESM Rules, wheeling and connection agreement and RSC, upon finding by the ERC after due notice and hearing. Pages of 192”) DRAFT Section 2. Deferment of Disconnection.. The disconnection may be deferred should any of the following occur: 2.1 The outstanding amount due and demanded was settled prior to the scheduled disconnection date. The requesting party that filed for disconnection should have immediately informed the Network Service Provider of the settlement/payment of the outstanding amount to defer the execution of such disconnection. If at the time the disconnection is to be made, the RES or the Contestable Customer tenders full payment of the outstanding balance to the Network Service Provider, the latter shall desist from disconnecting the service to allow the RES or the Contestable Customer to pay his bills within twenty four (24) hours: Provided, however, That the RES or the Contestable Customer can only invoké this provision once for the same unpaid bill. 2.2 Recalled notice of disconnection by the requesting party as a result of a special payment agreement or restructuring agreement entered into by the contracting parties prior to the scheduled disconnection date: The requesting party should have immediately informed the RES of the recall for the Network Service Provider to defer the execution of such disconnection. 2.3 Recalléd notice of disconnection by the requesting party for any valid reason not stated above. Section 3. The disconnected Contestable Customer and/or RES shall continue to be liable for any and all of its outstanding obligations and liabilities under the DSOAR, WESM Rules and all other existing contracts. Section 4. A Contestable Customer shall be reconnected upon ‘occurrence of the following: 4.1 The RES requesting for a reconnection of its Contestable Customer shall submit its notice of reconnection to the Network Service Provider for the execution of the request for reconnection. Pages4 of 192nd DRAFT. 4.2 The Network Service Provider shall execute the reconnection of service, within twenty four (24) hours from receipt of the notice of reconnection from the RES. 4.3 In the case of the disconnected Contestable Customer wherein its disconnection was requested by multiple suppliers, the reconnection will only be executed when the Primary RES has issued the notice of reconnection to the Network Service Provider. 4.4 If the electricity supply was disconnected due to non-payment of bills or security deposit, the reconnection shall be restored on the same day of receipt of payment from the Contestable Customer. 4.5 Across instances, a reconnection fee shall be paid by the disconnected Contestable Customer to either the RES or to the Network Service Provider prior to reconnection. Section 5. The procedures for disconnection, deferment of. disconnection and reconnection of Contestable Customers shall also be governed by the Network Service Providers’ existing rules and ERC relevant issuances. ARTICLE VI OTHER PROHIBITED ACTS UNDER RCOA Section 1. No RES shall engage in any anti-competitive agreement that prevents or reduces competition in the retail market. Section 2. No RES shall enter into a retail supply contract which refers to the supply of fixed quantities or take or pay provision. Section 3. No RES shall apply any cancellation or termination charges should the Contestable Customer terminate the retail supply contract beyond six-month period prior to its expiry date. Section 4. No DU shall unreasonably refuse to execute a DWS agreement with a RES. Pagessof192nd DRAFT Section 5. No Network Service Provider shall delay the submission of metering-related requirements to the CRB. Section 6. No DU shall engage in any act that will prevent a Contestable Customer from entering into a retail supply contract with a RES. Section 7. No changes in load shedding/dropping protocol should be made by reason of migration by captive customers to the CREM, otherwise, the said act amounts to discrimination for which the DU shall be made liable. Section 8. The above prohibited acts shall be considered as anti- competitive behavior and shall be subject to appropriate fines and penalties. ARTICLE VIL CONTESTABILITY Section 1. The following’ end-users, while issued Certificates of La 12 13 Contestability by the ERC are allowed to Switch to the CREM: A newly-connected ‘end-user whose forecasted monthly average peak demand is at least three (3) MW shall qualify as a Contestable Customer. A newly-connected end-user whose forecasted monthly average peak demand qualifies for contestability under the threshold level set by the ERC shall be required to operate and register a monthly average peak demand for three (3) consecutive months which breaches the ERC threshold yet falls below 3MW. Should a Contestable Customer be the registered account owner of the revenue meter of the DU, but its facilities are leased or operated by another end-user (leaseholder/operator) whose monthly average peak demand based on its actual use likewise qualifies for contestability, shall be the Contestable Customer for purposes of implementing the provisions of the RCOA. Page 16.06192nd DRAFT For purposes of confirming contestability, the leaseholder or operator shall seek confirmation by the ERC and furnish the latter copy of its lease contract duly endorsed by the DU. Only one Contestable Customer shall be recognized by the ERC for a particular account. ARTICLE VIII SPECIAL PROVISION A GenCo connected to a distribution system and have no direct connection to the grid shall be allowed to enter DWS agreement with the DU, subject to the payment of distribution wheeling rates duly approved by the ERC. The DWSA pro-forma contract to be adopted by the DU and GenCo is hereto attached as “Annex B”. ARTICLE IX DISPUTES Section 1, B2B System Contingency LL In case of emergencies affecting the operation of the B2B System, the CRB shall inform the ERC, NGCP,WMSP, affected DUs and RES, by email and/or through publication in the website, of the situation within one (1) hour of its occurrence. During such situation, transactions will be done through electronic mail or other technology. ‘The B2B System transaction timeframes, however, shall still be complied with. Section 2. Discrepancy on Data 21 In case of dat discrepancies (e.g. meter reading, billing errors, customer information), data from the Network Service Provider/WMSP shall be used temporarily while the discrepancy is being investigated by the ERC. Page 17 0f19)2nd DRAFT 2.2 Disputes on data discrepancy shall be resolved through the dispute resolution process of the ERC. Section 3. Dispute Resolution 3. Any dispute or complaint arising from the switching processes contained in these Rules, and such other procedures necessary to facilitate the Switching process, shall be resolved through the dispute resolution process of the ERC. Section 4. B2B System Transaction Timeframes 4.1 Requests, notices, responses to notices or requests, and data sent or received by a concerned entity before 3:00 P.M. on a Business Day shall be received on that Business Day. Otherwise, it shall be deemed to have been received on the first working hour on the next Business Day. ARTICLE X SANCTIONS The ERC shall impose the appropriate fines and penalties for any violation or non-compliance with these Rules, pursuant to the “Guidelines to Govern the Imposition of Administrative Sanctions in the Form of Fines and Penalties Pursuant to Section 46 of R.A. 9136”. ARTICLE XI AMENDMENTS The ERC shall amend and expand these Rules from time to time where this may be necessary. Before making any significant revisions to the Rules, the ERC will undertake public consultation as appropriate. Any other previous rule promulgated by the ERC that is inconsistent with this is hereby modified accordingly. PagerBoli9and DRAFT ARTICLE XI SEPARABILITY If for any reason any provision of the ERC Rules Supplementing the Switching and Billing Process and Adopting a Disconnection Policy for Contestable Customers is declared unconstitutional or invalid by final judgment of a competent court, the other parts or provisions hereof which were not affected thereby shall continue to be in full force and effect. ARTICLE XIII EFFECTIVITY The ERC Rules Supplementing the Switching and Billing Process and Adopting a Disconnection Policy for Contestable Customers shall take effect on the fifteenth (15'») day following its publication in a newspaper of general circulation in the country. Pasig City, ALFREDO J. NON OIC, Chairman & CEO of the ERC GLORIA VICTORIA C. YAP-TARUC Commissioner JOSEFINA PATRICIA A. MAGPALE-ASIRIT Commissioner GERONIMO D. STA. ANA Commissioner Pege 1g of19Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 1ofi1 ANNEX “A” DISTRIBUTION WHEELING SERVICE AGREEMENT (For Contestable Customers) This AGREEMENT is entered into this day of at________City, Philippines, by and between: , a company duly organized and existing under the laws of the Republic of the Philippines, with principal offices at. , duly represented by Mr./Ms. (designation) = and =——Mr./Ms. (designation) hereinafter referred to as "CONTESTABLE CUSTOMER’; -and- , duly organized and existing under the laws of the Republic of the Philippines, with principal offices at duly represented by - Mr./Ms. (designation), and hereinafter referred to as. "Distribution Utility or DU; "CONTESTABLE CUSTOMER" and "DU" hereinafter shall collectively be referred to as "PARTIES". WITNESSETH THAT: WHEREAS, the CONTESTABLE CUSTOMER is an end-user certified by the Energy Regulatory Commission (ERC) as such under Certificate Number dated ; WHEREAS, the same CONTESTABLE CUSTOMER is a Direct Member of the Wholesale Electricity Spot Market (WESM) since WHEREAS, the DU, is an entity with a legislative franchise to operate and maintain an electric distribution system in the Cities/ Municipalities of ;Distribution _ Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 2 of 11 Ex “A” WHEREAS, the CONTESTABLE CUSTOMER is desirous of procuring from the WESM and simultaneously, of availing of the Distribution Wheeling Service (DWS) offered by the DU; WHEREAS, the PARTIES agree to permit the wheeling transaction to take place based on the terms and conditions as set out in this Agreement; subject to rules and regulations of the ERC and any other applicable laws; NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants set forth herein, the PARTIES hereto agree as follows: Section 1. Scope. This Agreement is solely for the provision of DWS for a Direct WESM Member contestable customer, which pertains to those services performed for the conveyance of electricity to the CONTESTABLE CUSTOMER through the distribution system in order to meet the demand of such customer. This Agreement does not constitute an Agreement to supply electricity. Section 2. Provision of DWS. Subject to the terms and conditions of this Agreement, and applicable rules and regulations, the DU shall provide DWS to the CONTESTABLE CUSTOMER under the technical specifications specified in the attached Schedule with the concerned customer. The CONTESTABLE CUSTOMER shall not modify or allow the modification of the technical specifications without the written consent of the DU. Should the CONTESTABLE CUSTOMER intend to modify said specifications, the CONTESTABLE CUSTOMER shall notify the DU no less than thirty (30) business days in advance. Any incremental cost attributable to any modification in the specifications of the CONTESTABLE CUSTOMER shall be made at the sole expense of the CONTESTABLE CUSTOMER. Section 3. Charges. The CONTESTABLE CUSTOMER shall pay DWS charges, including all applicable taxes, based on the applicable rate schedule approved by the ERC for the provision of DWS, which include, among others, the: (i) Distribution Charge; (ii) Standard Connection Charge (SCC), or Guaranteed Minimum Billing Demand (GMBD); (iii) Supply Charge; (iv) Metering Charge; (v) System Loss Charge; (vi) Transmission Charge; (vii) Local Franchise Tax; (viii) Senior Citizen 2Distribution Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 3 of 11 ANNEX “A” Discount, if applicable; (ix) Lifeline Subsidy; (x) Universal Charge; and (xi) Other Charges and Adjustments which shall include, but not limited to, over/under-recoveries and other pass-through charges approved by the ERC to be billed by the DU. Said charges shall be payable in accordance with Section 9 (Billing & Payment) hereof, commencing on the first billing month from the effectivity of this Agreement. Section 4. Eligibility for DWS. A CONTESTABLE CUSTOMER shall be eligible for DWS if it: (i) continues to possess all the eligibility requirements under the rules and regulations governing RCOA; and (ii) has no undisputed outstanding debts with the DU, the transmission service provider, or the WESM. Section 5. Duties and Responsibilities of the Contestable Customer. The CONTESTABLE CUSTOMER shall: a, Secure any required approvals from the ERC and/or other governmental agencies for its authority as contestable customer; b. Comply with the technical specifications and requirements, and technical infrastructure/equipment standards prescribed by the DU, as embodied in the Connection Agreement (CA) executed by the CONTESTABLE CUSTOMER, including applicable provisions of the Philippine Distribution Code (PDC), rules and regulations of the ERC and any other applicable law or guidelines. c. Be solely responsible for complying with any applicable WESM requirement; d. Be solely responsible for its contractual obligations with the DU and other entities regarding supply of electricity and billing matters, including disputes; and e. Enjoin not to engage in pilferage of electricity and strictly complies with its. Section 6. Duties and Responsibilities of the DU. The DU shall:Distribution Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 4 of 11 a ANNEX “A” a. Subject to system constraints and performance standards approved by the ERC, make reasonable provisions to provide steady and continuous DWS to all its customers. y Comply with applicable laws, and pertinent government rules and regulations, as well as good utility practice; c. Use as reference the registrations of the metering facilities which are capable of measuring energy use and demand, unless an estimated meter reading is necessary, in accordance with applicable rules and regulations; a |. Protect the interests of the contestable customers in good standing; and e. Enjoin its customers not to engage in pilferage of electricity and monitor that its customer strictly complies with it. Section 7. Additional Terms and Conditions. Any terms and conditions specifically applicable to the PARTIES shall be specified in the applicable Schedule, which shall be considered integral part hereof. Section 8. Switching of Contestable Customer. Switching of the Contestable Customer shall follow the procedure laid down in the applicable rules and regulations. a. The switching of the Contestable Customer shall not be allowed in the absence of the required switch approval from the Central Registration Body (CRB); and b. The DU shall have the right to fully rely on the Switch Approval sent to it by the CRB and shall not be responsible for verifying the validity of such approval. In all cases, the Contestable Customer shall hold the DU free from any liability arising therefrom. Section 9. Billing and Payment. The CONTESTABLE CUSTOMER shall be billed by the DU for all the charges stipulated under this Agreement and the applicable Schedule, if any, including any billing adjustment, differential bills and such other charges as may be approved by the ERC. Said bill shall become due and demandable within calendar days from the receipt of said bill by the CONTESTABLE 4Distribution Wheeling Service Agreement __ Between Distribution Utility and Contestable Customer Pro-Forma Contract Page § of 11 ANNEX “A” CUSTOMER. Any amount unpaid shall be charged with interest at the rate previously approved by the ERC from the date the bill was due to be paid. The CONTESTABLE CUSTOMER may dispute any bills in writing within thirty (30) calendar days from receipt of the bill. Notwithstanding the foregoing, the CONTESTABLE CUSTOMER shall continue to pay the disputed bills without deductions or any offset and shall not be an excuse or ground for the CONTESTABLE CUSTOMER to delay payment of succeeding bills or to unilaterally deduct any amount therefrom. The DU shall resolve any disputed bills within thirty (30) calendar days from receipt of the written complaint. Section 10. Bill Deposit. Prior to the commencement of the services to the CONTESTABLE CUSTOMER, a bill deposit to secure payment of any outstanding regular bills shall be paid by the CONTESTABLE CUSTOMER to the DU, equivalent to the one (1) month estimated billing for all DWS Charges under Section 3 (Charges) hereof, based on the CONTESTABLE CUSTOMER'S average billing’ in the immediately preceding twelve (12) months or in case of a newly connected customer, based on projected demand and/or energy of such customer. The DU may likewise apply such bill deposit to any outstanding bill, billing adjustment or differential billing upon termination of the contract. Said-deposit shall be adjusted: (i) annually, to reflect the average billing of the CONTESTABLE CUSTOMER during a one (1) year period; or (ii) to replace any deposit previously applied to any outstanding bill, billing adjustment or differential billing. Any excess or deficiency in the amount of bill deposit, after said adjustment, shall be correspondingly refunded through credit to bill to, or collected from the CONTESTABLE CUSTOMER by the DU. A CONTESTABLE CUSTOMER that has paid its electric bills on or before its due date for three (3) consecutive years may, however, demand for the full refund of the deposit prior to the termination of its service. The provisions of the DSOAR shall apply. Section 11. Disconnection of Service of Contestable Customers. Subject to prior notice to the CONTESTABLE CUSTOMER by the DU, the services of the CONTESTABLE CUSTOMER shall be disconnected under any of the following circumstances:Distribution Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 6 of ANNEX “A” a. Failure to pay the DWS charges, or any adjusted or differential bills or such other charges stipulated in this Agreement, on the due date, in part or in whole; b. Violation of R.A. 7832, otherwise known as “Anti-electricity and Electric Transmission Lines/Materials Pilferage Act of 1994”, and. of any of the terms and conditions of this Agreement; c. Non-compliance with any of the provisions of the applicable laws, including any amendments thereon; and d. Other circumstances allowed by law or government rules and regulations. The CONTESTABLE CUSTOMER's exercise of its rights under this Article shall not mean entitlement to renege on its obligation to pay the DWS charges, disconnection fees or other billings rendered under this Agreement. Nothing in this agreement shall prevent the DU from temporarily discontinuing the provision of DWS whenever it finds it necessary to execute any routine maintenance, repairs or modifications on its distribution system or in the event of an emergency or to correct unsafe operating conditions in the distribution or connection facilities; Provided however, that except in cases of force majeure, forced outage/interruption,- event of emergency or the need to correct unsafe operating conditions, the DU shall give advance notice to the . CONTESTABLE CUSTOMER within a reasonable time of said temporary discontinuance of DWS, in a manner allowed by the applicable rules and regulations. In case the DWS is temporarily discontinued under this Section, the DU shall likewise effect the reconnection of the CONTESTABLE CUSTOMER’s service, when the DU’s routine maintenance, repairs or modification to the facilities and nearby facilities have been completed or when the emergency has ceased or the unsafe operating conditions in the distribution or connection facilities have been corrected. Section 11. Disconnection/Reconnection of the Contestable Customer. In the event that the CONTESTABLE 6Distribution Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 7 of 11 ANNEX “A” CUSTOMER fails to pay for service rendered by due date, it shall be disconnected within twenty (24) hours from receipt of the disconnection notice from the DU. Reconnection of the CONTESTABLE CUSTOMER shall be subject to payment of appropriate reconnection fees as approved by the ERC. If the emergency or unsafe operating condition, which brought about the suspension of the DWS is due to the fault of the CONTESTABLE CUSTOMER, the same shall likewise be subject to payment of appropriate reconnection fees. The procedures for disconnection, deferment of disconnection and reconnection of CONTESTABLE CUSTOMER shall likewise be governed by the DU’s existing rules and ERC relevant issuances. Section 14. Cessation of Direct WESM Membership of Contestable Customer. Upon cessation of Direct membership of the CONTESTABLE CUSTOMER in the WESM, the PEMC or Independent Market Operator (IMO) shall, within twenty-four (24) hours, notify the DU of such fact. Thereafter, the DU shall send a final billing to the contestable customer covering its DWS, including any adjusted or differential bill/s and other applicable charges approved by the ERC, if the service is terminated before the next scheduled reading. In case the cessation of the Direct WESM membership of the CONTESTABLE CUSTOMER was due to the reversion of the latter to the captive market, the discontinuance of DWS to such contestable customer shall become effective only at the end of the meter reading date of said customer; Provided that, such reversion of the customer to the captive market has been approved by the ERC, with notice to the DU. For the avoidance of doubt, prior to the effectivity of the discontinuance of the DWS to such CONTESTABLE CUSTOMER, the CONTESTABLE CUSTOMER shall continue to be liable for the payment of charges as stipulated under Sections 3 (Charges) and 9 (Billing & Payments) hereof and the observance of the terms and conditions provided in this Agreement. Section 15. Undelivered Energy, Damages and Other Losses. The CONTESTABLE CUSTOMER understands that the DU undertakes scheduled and/or unscheduled maintenance, repairs and replacement of its facilities to improve service. In such cases, and in other cases of outages due to events stated in Section 17 (Force 7Distribution Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 8 of 11 ANNEX “A” Majeure/Fortuitous Event/Other Event) or for reasons not attributable to the fault of the DU, the CONTESTABLE CUSTOMER agrees that the DU. shall not be liable for any undelivered energy, or for damages, whether direct or consequential, including without limitation, loss of Profits, loss of revenue, or loss of production capacity, as a result of interruption or disconnection of its service. Section 16. Liability for Non-technical System Losses and Damages as a result of Pilferage. The CONTESTABLE CUSTOMER shall be liable for non-technical system losses if it engages in the. pilferage of electricity or tampering of meters or facilities of the DU. Section 17. Force Majeure/Fortuitous Event/Other Event. The DU shall not be liable to the CONTESTABLE CUSTOMER with respect to the non-performance of any of its obligations under this Agreement in the event and to the extent that such non-performance is the direct result of or has been directly caused by force majeure and fortuitous event including other event that are beyond the control of the DU. Force majeure and fortuitous event including other event shall mean Such event: (i) that is not within the reasonable control, directly and indirectly, of the DU; and (ii) which, despite the exercise of reasonable diligence, cannot be prevented, avoided or removed by the DU; Provided That, the DU has taken all reasonable precautions, and due care in order to avoid or mitigaté the effect of such event on the DU's ability to perform its obligations under this Agreement. These events shall include, but may not be limited to the following: a. A typhoon, storm, tropical depression, flood, drought, volcanic eruption, earthquake, tidal wave or landslide; b. An act of public enemy, war (declared or undeclared), sabotage, blockade, revolution, riot, insurrection, civil commotion or any violent or threatening actions; c. Non system-wide and system-wide Transmission constraints and/or outages in the Transmission and Distribution System; and d. Any lawful orders rendered by competent authority, including any advice or warnings of government authorities for safety reasons.Distribution Wheeling Service Agreement —_ Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 2 of 14 ANNEX “A” Section 18. Amendment/Modification of Agreement. This Agreement, including the applicable Schedule with the CONTESTABLE. CUSTOMER, constitutes the sole and entire agreement between the PARTIES and supersedes all previous arrangements or agreements in respect of the subject-matter of this Agreement. No amendments of this Agreement or the applicable Schedule with the CONTESTABLE CUSTOMER, or consent to any departure therefrom, shall in any way be of any force or effect unless confirmed in writing and signed by the PARTIES. If necessary, such amendment or departure shall be effective only upon approval by the ERC. The failure of any Party, at any time, to require performance of any provision hereof shall in no manner affect the right to enforce the same at a later time. No waiver by any Party of the breach of any term or covenant contained in this Agreement, whether by conduct or otherwise, shall be deemed to be construed as a further or continuing waiver of such breach or waiver of the breach of any other term or covenant, unless such waiver is in writing. Section 19. Effectivity and Termination of Agreement. This Agreement shall be valid and binding to the PARTIES upon execution hereof unless terminated by either party by serving written notice to the other at least thirty (30) calendar days before the effective date of termination. It shall take effect on the earliest next regular meter reading date of the CONTESTABLE CUSTOMER, as contained in the attached Schedule, after the execution date hereof. Upon termination or expiration of this Agreement, all rights and obligations of the PARTIES hereunder shall cease, except (a) such rights and obligations as may have accrued as of the date of termination or expiration, such as but not limited to payment of any outstanding bills; and (b) any right or obligation which survives the termination of this ‘Agreement. Section 20. Warranties. The PARTIES represent and warrant to each other that: (i) the signatories to this Agreement are duly authorized to sign this Agreement; and (ii) all requisite authorizations, approvals, permits or consent to make this Agreement or any amendment or supplement thereto valid and enforceable have been obtained. Section 21. Invalidity of Provisions. If any provision of this Agreement is declared by a competent court to be invalid or unenforceable, the invalidity or unenforceability of such provisions shall 9Distribution Wheeling Service Agreement Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 10 of 11 ANNEX “A” not affect the other provisions of this Agreement, and all provisions not affected by such invalidity or unenforceability shall remain in full, force and effect. Section 22. Assignment of Rights. The CONTESTABLE CUSTOMER shall not assign its rights under this Agreement. In case of any change in its corporate name, or status brought about by merger, consolidation, amendment of articles of incorporation, sale of business or transfer of ownership, the CONTESTABLE CUSTOMER shall advise the DU of such fact in writing, within thirty (30) calendar days from the effective date thereof. Violation of this provision shall give the DU the right to terminate this Agreement, without prejudice to any action that the DU may bring for the collection of any outstanding obligation of the CONTESTABLE CUSTOMER to the DU. Section 23. Disputes. If any dispute shall arise between the PARTIES in connection with or arising out of this Agreement, either party may request in writing to meet within five (5) days from occurrence thereof and attempt to resolve the dispute. In the event that such dispute remains unresolved within ten (10) days after such request; the aggrieved party may bring the dispute for resolution by the ERC if said dispute is within the exclusive jurisdiction of the ERC. Otherwise, the aggrieved party may seek redress from the regular courts. In case of the latter, the PARTIES hereby agree that the venue for any court action shall be the regular courts of the principal place of business or principal office where the DU is located. IN WITNESS-WHEREOF, the PARTIES hereto have caused the foregoing instrument to be executed by their respective officers and/or their representatives, thereunto duly authorized at the place and on the date first above written. Signature Over Printed Name Signature Over Printed Name (Designation) (Designation) (DU) (Contestable Customer) (Date Signed) (Date Signed)Distribution Wheeling Service Agreement _ Between Distribution Utility and Contestable Customer Pro-Forma Contract Page 11 of 14 ANNEX “A” SIGNED IN THE PRESENCE OF: (Witness Name, Signature Over‘ (Witness Name, Signature Over ; Printed Name) Printed Name) ACKNOWLEDGMENT Republic of the Philippines } SEER EEE EEE EEE SG Before me, a Notary Public, for and in the City of personally appeared the following affiants with ‘their respective competent proof of identities: bu Valid government issued ID CONTESTABLE CUSTOMER Valid government issued ID known to me and to me known to be the same persons who executed the foregoing instrument, consisting of pages, including the page whereon this Acknowledgment is written, with all pages signed by both PARTIES and their instrumental witnesses, and they acknowledged to me that the same is their free and voluntary act and deed and that of the Corporation /Company they respectively represent. IN WITNESS WHEREOF, | have hereunto set my hand and seal this day of____, at Philippines.Distribution Wheeling Service Agreement Between Distribution Utility and Generation Company Pro-Forma Contract Page 1of10 ANNEX “B” DISTRIBUTION WHEELING SERVICE AGREEMENT (For Generation Company) This AGREEMENT is entered into this day of at City, Philippines, by and between: , a company duly organized and existing under the laws of the Republic of the Philippines, with principal offices at , duly represented by Mr/Ms. (designation) and Mr/Ms. (designation) hereinafter referred to as "GENERATION COMPANY or GENCO"; -and- duly organized and existing under the laws of the Republic of the Philippines, with principal offices at duly represented by Mr./Ms. ___ (designation), and hereinafter referred to as "Distribution Utility or DU; "GENCO" and "DU" hereinafter shall collectively be referred to as "PARTIES". WITNESSETH THAT: WHEREAS, the GENCO is a generating unit that is indirectly connected to the grid through the DU or industrial generating facilities synchronized with the grid; WHEREAS, the GENCO is a Direct Member of the Wholesale Electricity Spot Market (WESM) since ; WHEREAS, the DU, is an entity with a legislative franchise to operate and maintain an electric distribution system in the Cities/ Municipalities of. esDistribution Wheeling Service Agreement Between Distribution Utility and Generation Company Pro-Forma Contract Page 2of10 ANNEX “B” ‘WHEREAS, the GENCO is desirous of procuring from the WESM and simultaneously, of availing of the Distribution Wheeling Service (DWS) offered by the DU; WHEREAS, the PARTIES agree to permit the wheeling transaction to take place based on the terms and conditions as set out in this Agreement; subject to rules and regulations of the ERC and any other applicable laws; NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants set forth herein, the PARTIES hereto agree as follows: Section 1. Scope. This Agreement is for the provision of DWS for a GenCo, which pertains to those services performed for the conveyance of electricity to the GENCO through the distribution system in order to meet the demand of such customer. This Agreement does not constitute an Agreement to supply electricity. Section 2. Provision of DWS. Subject to the terms and conditions of this Agreement, and applicable rules and regulations, the DU shall provide DWS to the GENCO under the technical specifications specified in the attached Schedule with the concerned customer. The GENCO shall not modify or allow the modification of the technical specifications without the written consent of the DU. Should the GENCO intend to modify said specifications, the GENCO shall notify the DU no less than thirty (30) business days in advance. Any incremental cost attributable to any modification in the specifications of the GENCO shall be made at the sole expense of the GENCO. Section 3. Charges. The GENCO shall pay DWS charges, including all applicable taxes, based on the applicable rate schedule approved by the ERC for the provision of DWS, which include, among others, the: (i) Distribution Charge; (ii) Standard Connection Charge (SCC), or Guaranteed Minimum Billing Demand (GMBD); (iii) Supply Charge; (iv) Metering Charge; (v) System Loss Charge; (vi) Transmission Charge; (vii) Local Franchise Tax; (viii) Senior Citizen Discount, if applicable; (ix) Lifeline Subsidy; (x) Universal Charge; and (xi) Other Charges and Adjustments which shall include, but not limited to, over/under-recoveries and other pass-through charges approved by the ERC to be billed by the DU. Said charges shall be payable in accordance 2Distribution Wheeling Service Agreement Between Distribution Utility and Generation Company Pro-Forma Contract : Page 3 of 10 ANNEX “B” with Section 8 (Billing & Payment) hereof, commencing on the first billing month from the effectivity of this Agreement. Section 4. Eligibility for DWS. A GENCO shall be eligible for DWS if it: (i) continues to possess all the requirements under the applicable rules and regulations; and (ii) has no undisputed outstanding debts with the DU, the transmission service provider, or the WESM. Section 5. Duties and Responsibilities of the Generation Company. The GENCO shall: a. Secure any required approvals. from the ERC and/or other governmental agencies for its authority as generation company; b. Comply with the technical specifications and requirements, and technical infrastructure/equipment standards prescribed by the DU, as embodied in the Connection Agreement executed by the GENCO, including applicable provisions of the Philippine Distribution Code (PDC), rules and regulations of the ERC and any other applicable law or guidelines, ¢. Be solely responsible for complying with any applicable WESM requirement; d. Be solely responsible for its contractual obligations with the DU and other entities regarding supply of electricity and billing matters, including disputes; and e. Enjoin not to engage in pilferage of electricity and strictly complies with its. Section 6. Duties and Responsibilities of the DU. The DU shall: a. Subject to system constraints and performance standards approved by the ERC, make reasonable provisions to provide steady and continuous DWS to all its customers. b. Comply with applicable laws, and pertinent government rules and regulations, as well as good utility practice;Distribution Wheeling Service Agreement __ Between Distribution Utility and Generation Company Pro-Forma Contract Page. 4 of 10 ANNEX “B” c. Use as reference the registrations of the metering facilities which are capable of measuring energy use and demand, unless an estimated meter reading is necessary, in accordance with applicable rules and regulations; Lad Protect the interests of the contestable customers in good standing; and ® . Enjoin its customers not to engage in pilferage of electricity and monitor that its customer strictly complies with it. Section 7. Additional Terms and Conditions. Any terms and conditions specifically applicable to the PARTIES shall be specified in the applicable Schedule, which shall be considered integral part hereof. Section 8. Billing and Payment. The GENCO shall be billed by the DU for all the charges stipulated under this Agreement and the applicable Schedule, if any, including any billing adjustment, differential bills and such other charges as may be approved by the ERC. Said bill shall become due and demandable within calendar days from the receipt of said bill by the GENCO. Any amount unpaid shall be charged with interest at the rate previously approved by the ERC from the date the bill was due to be paid. The GENCO may dispute any bills in writing within thirty (30) calendar days from receipt of the bill. Notwithstanding the foregoing, the GENCO shall continue to pay the disputed bills without deductions or any offset and shall not be an excuse or ground for the GENCO to delay payment of succeeding bills or to unilaterally deduct any amount therefrom. The DU shall resolve any disputed bills within thirty (30) calendar days from receipt of the written complaint. Section 9. Bill Deposit. Prior to the commencement of the services to the GENCO, a bill deposit to secure payment of any outstanding regular bills shall be paid by the GENCO to the DU, equivalent to the one (1) month estimated billing for all DWS Charges under Section 3 (Charges) hereof, based on the GENCO’s average billing in the immediately preceding twelve (12) months or in case of a newly connected customer, based on projected demand and/or energy of such customer. The DU may likewise apply such bill deposit to anyDistribution Wheeling Service Agreement _ Between Distribution Utility and Generation Company Pro-Forma Contract Page 5 of 10 ANNEX “B” outstanding bill, billing adjustment or differential billing upon termination of the contract. Said deposit shall be adjusted: (i) annually, to reflect the average billing of the GENCO during a one (1) year period; or (ii) to replace any deposit previously applied to any outstanding bill, billing adjustment or differential billing. Any excess or deficiency in the amount of bill deposit, after said adjustment, shall be correspondingly refunded through credit to bill to, or collected from the GENCO by the DU. A GENCO that has paid its electric bills on or before its due date for three (3) consecutive years may, however, demand for the full refund of the deposit prior to the termination of its service. The provisions of the DSOAR shall apply. Section 10. Disconnection of Service of Generation Company. Subject to prior notice to the GENCO by the DU, the services of the GENCO shall be disconnected under any of the following circumstances: a. Failure to pay the DWS charges, or any adjusted or differential bills or such other charges stipulated in this Agreement, on the due date, in part or in whole; b. Violation of R.A. 7832, otherwise known as “Anti-electricity and Electric Transmission Lines/Materials Pilferage Act of 1994”, and of any of the terms and conditions of this Agreement; c. Non-compliance with any of the provisions of the applicable laws, including any amendments thereon; and d. Other circumstances allowed by law or government rules and regulations. The GENCO's exercise of its rights under this Article shall not mean entitlement to renege on its obligation to pay the DWS charges, disconnection fees or other billings rendered under this Agreement. Nothing in this agreement shall prevent the DU from temporarily discontinuing the provision of DWS whenever it finds it necessary to execute any routine maintenance, repairs or modifications on its 5Distribution Wheeling Service Agreement Between Distribution Utility and Generation Company Pro-Forma Contract Page 6 of 10 “B” distribution system or in the event of an emergency or to correct unsafe operating conditions in the distribution or connection facilities; Provided however, that except in cases of force majeure, forced outage/interruption, event of emergency or the need to correct unsafe operating conditions, the DU shall give advance notice to the GENCO within a reasonable time of said temporary discontinuance of DWS, in a manner allowed by the applicable rules and regulations. In case the DWS is temporarily discontinued under this Section, the DU shall likewise effect the reconnection of the GENCO’s service, when the DU’s routine maintenance, repairs or modification to the facilities and nearby facilities have been completed or when the emergency has ceased or the unsafe operating conditions in the distribution or connection facilities have been corrected. Section 11. Disconnection/Reconnection of the Generation Company. In the event that the GENCO fails to pay for service rendered by due date, it shall be disconnected within twenty (24) hours from receipt of the disconnection notice from the DU. Reconnection of the GENCO shall be subject to payment of appropriate reconnection fees as approved by the ERC. If the emergency or unsafe operating condition, which brought about the suspension of the DWS is due to the fault of the GENCO, the same shall likewise be subject to payment of appropriate reconnection fees. ‘The procedures for disconnection, deferment of disconnection and reconnection of GENCO shall likewise be governed by the DU’s existing rules and ERC relevant issuances. Section 12. Undelivered Energy, Damages and Other Losses. The GENCO understands that the DU undertakes scheduled and/or unscheduled maintenance, repairs and replacement of its facilities to improve service. In such cases, and in other cases of outages due to events stated in Section 14 (Force Majeure/Fortuitous Event/Other Event) or for reasons not attributable to the fault of the DU, the GENCO agrees that the DU shall not be liable for any undelivered energy, or for damages, whether direct or consequential, including without limitation, loss of profits, loss of revenue, or loss of production capacity, as a result of interruption or disconnection of its service.Distribution Wheeling Service “Agreement Between Distribution Utility and Generation Company Pro-Forma - Contract Page 7. of 10 “B” Section 13. Liability for Non-technical System Losses and Damages as a result of Pilferage. The GENCO shall be liable for non-technical system losses if it engages in the pilferage of electricity or tampering of meters or facilities of the DU. Section 14. Force Majeure/Fortuitous Event/Other Event. The DU shall not be liable to the GENCO with respect to the non- performance of any of its obligations under this Agreement in the event and to the extent that such non-performance is the direct result of or has been directly caused by force majeure and fortuitous event including other event that are beyond the control of the DU. Force majeure and fortuitous event including other event shall mean such event: (i) that is not within the reasonable control, directly and indirectly, of the DU; and Gi) which, despite the exercise of reasonable diligence, cannot be prevented, avoided or removed by the DU; Provided That, the DU has taken all reasonable precautions, and due care in order to avoid or mitigate the effect of such event on the DU's ability to perform its obligations under this Agreement. These events shall include, but may not be limited to the following: a. A typhoon, storm, tropical depression, flood, drought, volcanic eruption, earthquake, tidal wave or landslide; b. An act of public enemy, war (declared or undeclared), sabotage, blockade, revolution, riot, insurrection, civil commotion or any violent or threatening actions; c. Non system-wide and system-wide Transmission constraints and/or outages in the Transmission and Distribution System; and d. Any lawful orders rendered by competent authority, including any advice or warnings of government authorities for safety reasons. Section 15. Amendment/Modification of Agreement. This Agreement, including the applicable Schedule with the GENCO, constitutes the sole and entire agreement between the PARTIES and supersedes all previous arrangements or agreements in respect of the subject-matter of this Agreement. No amendments of this Agreement or the applicable Schedule with the GENCO, or consent to any departure therefrom, shall in any way be of any force or effect unless confirmed in 7Distribution Wheeling Service Agreement Between Distribution Utility and Generation Company Pro-Forma Contract 7 Page 8 of 10 ANNEX “B” writing and signed by the PARTIES. If necessary, such amendment or departure shall be effective only upon approval by the ERC. The failure of any Party, at any time, to require performance of any provision hereof shall in no manner affect the right to enforce the same at a later time. No waiver by any Party of the breach of any term or covenant contained in this Agreement, whether by conduct or otherwise, shall be deemed to be construed as a further or continuing waiver of such breach or waiver of the breach of any other term or covenant, unless such waiver is in writing. Section 16. Effectivity and Termination of Agreement. This Agreement shall be valid and binding to the PARTIES upon execution hereof unless terminated by either party by serving written notice to the other at least thirty (30) calendar days before the effective date of termination. It shall take effect on the earliest next regular meter reading date of the GENCO, as contained in the attached Schedule, after the execution date hereof. Upon termination or expiration of this Agreement, all rights and obligations of the PARTIES hereunder shall cease, except (a) such rights and obligations as may have accrued as of the date of termination or expiration, such as but not limited to payment of any outstanding bills; and (b) any right or obligation which survives the termination of this Agreement. Section 17. Warranties. The PARTIES represent and warrant to each other that: (i) the signatories to this Agreement are duly authorized to sign this Agreement; and (ii) all requisite authorizations, approvals, permits or consent to make this Agreement or any amendment or supplement thereto valid and enforceable have been obtained. Section 18. Invalidity of Provisions. If any provision of this Agreement is declared by a competent court to be invalid or unenforceable, the invalidity or unenforceability of such provisions shall not affect the other provisions of this Agreement, and all provisions not affected by such invalidity or unenforceability shall remain in full force and effect. Section 19. Assignment of Rights. The GENCO shall not assign its rights under this Agreement. In case of any change in its corporate name, or status brought about by merger, consolidation, amendment of articles of incorporation, sale of business or transfer of 8Distribution Wheeling Service Agreement _ Between Distribution Utility and Generation Company Pro-Forma Contract Page 9 of 10 ANNEX “B” ownership, the GENCO shall advise the DU of such fact in writing, within thirty (30) calendar days from the effective date thereof. Violation of this provision shall give the DU the right to terminate this Agreement, without prejudice to any action that the DU may bring for the collection of any outstanding obligation of the GENCO to the DU. Section 20. Disputes. If any dispute shall arise between the PARTIES in connection with or arising out of this Agreement, either party may request in writing to meet within five (5) days from occurrence thereof and attempt to resolve the dispute. In the event that such dispute remains unresolved within ten (10) days after such request, the aggrieved party may bring the dispute for resolution by the ERC if Said dispute is within the exclusive jurisdiction of the ERC. Otherwise, the aggrieved party may seek redress from the regular courts. In case of the latter, the PARTIES hereby agree that the venue for any court action shall be the regular courts of the principal place of business or principal office where the DU is located. IN WITNESS WHEREOF, the PARTIES hereto have caused the foregoing instrument to be executed by their respective officers and/or their representatives, thereunto duly authorized at the place and on the date first above written. ‘Signature Over Printed Name Signature Over Printed Name (Designation) (Designation) (DU) (Generation Company) (Date Signed) (Date Signed) SIGNED IN THE PRESENCE OF: (Witness Name, Signature Over (Witness Name, Signature Over Printed Name) Printed Name)Distribution Wheeling Service Agreement Between Distribution Utility and Generation Company Pro-Forma Contract Page 10 of 10 4 ANNEX “B” ACKNOWLEDGMENT Republic of the Philippines } SS See Before me, a Notary Public, for and in the City of personally appeared the following affiants with their respective competent proof of identities: DU Valid government issued ID GENERATION COMPANY Valid government issued ID known to me and to me known to be the same persons who executed the foregoing instrument, consisting of pages, including the page whereon this Acknowledgment is written, with all pages signed by both PARTIES and their instrumental witnesses, and they acknowledged to me that the’same is their free and voluntary act and deed and that of the Corporation/Company they respectively represent. IN WITNESS WHEREOF, J have hereunto set my hand and seal this day of. pat Philippines. Series of