13-PARIS GENERATION LP (PGEN) WATER SERVICE AGREEMENT

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data accumulated for the then applicable Test Year, or the Estimated Day Demand amount requested by PGEN and accepted by CITY. 8.7 Prior to the end of the Initial Period, a detailed Cost of Service Study will be performed by an independent utility rate consultant chosen by CITY, such study to be performed in accordance with the methodology described in that excerpted portion of the J. Stowe & Co., LLC study, May, 2012, attached as Exhibit 1. The Cost of Service Study shall be developed on an actual historical cost test year basis (for the Test Year) allowing for reasonable and necessary expenses of providing such water service and allowing for known and measurable adjustrnenis, including satisfying CITY'S obligations under current and future bond covenants and CITY'S fiscal policies. Thereafter, on an annual cycle, a detailed Cost of Service Study shall be performed by an independent rate consultant chosen by CITY again using the same methodology as the excerpted portion of the Study in Exhibit 1, unless and until a different methodology is mutually agreed upon in writing by PGEN and CITY. As consideration for the Reservation Rate, PGEN shall pay to CITY the lesser of Twenty-Five percent (25%) of the annual Cost of Service Study or Six Thousand Two Hundred Fifty Dollars (US$6,250.00) (the "Maximum Study Sum"). All study costs in excess of Maximum Study Sum shall be borne by CITY. 8.8 During the Initial Period, and for any Rate Year thereafter, if PGEN'S Actual Day Demand exceeds its then current Estimated Day Demand, PGEN shall be assessed an excess demand charge equal to the product of (a) one and a half (1.5) multiplied by (b) the Annual Demand Charge, multiplied by (c) the difFerence between the Estimated Day Demand and the Actual Day Demand (the "Excess Demand Charge"). Payment of the Excess Demand Charge to CITY shall be due from PGEN thirty (30) days following PGEN's receipt of an invoice from CITY. Additionally, beginning the following Rate Year, PGEN'S then current Estimated Day Demand and Annual Demand Charge shall be adjusted (respectively, the "Adjusted EDD" and "Adjusted ADC") as provided in Section 8.6 above to reflect the new amounts established by the exceedance. FOR THE AVOIDANCE OF DOUBT, THE BELOW EXAMPLE REFLECTS THE ADJUSTMENTS THAT WOULD APPLY FOR AN INCREASE FROM AN ESTIMATED DAY DEMAND OF One Million Five Hundred Thousand (1,500,000) Gallons TO AN ACTUAL DAY DEMAND OF One Million Seven Hundred Thousand (1,700,000) Gallons. Example: Estimated Day Demand 1.5 MGD Initial Period Annual Demand Charge ($105,931 X 1.5) _ $ 158,897 Monthly Demand Charge ($158,897=12months) $ 13,241 - �. 5 4