Line Connection Policy

Dated: September 27, 2007
Supersedes Date: January 1, 2006

Objective: To enable connection to the distribution system while providing the means for Valley Electric Association, Inc. (the "Association") to protect the equity of existing members by ensuring, to the extent practical, that all connection costs are paid by the party requesting connection instead of by existing members.

Policy: It is the policy of the Association to make electric service available, to the extent practical, to all applicants in the Association’s service area under the prevailing rates and conditions of service.

1. General Definitions:
   1. "Power Available" as herein defined shall mean the point in time at which the primary or secondary facilities requested by the applicant have been constructed by the Association.
   2. "Delivery Point" as herein defined shall mean the metering point, bus bar, or as may otherwise be defined by the Association.
   3. "Upgrade" or "Relocation" as herein defined shall mean those existing Association facilities requested by applicant to be upgraded or relocated. (Costs to upgrade or relocate Association facilities shall be the responsibility of the applicant.)
   4. "Approved Plans" are defined as those site plan/map documents which have been reviewed and approved as indicated by the official stamp of the local jurisdictional authorities.
2. Connection Classifications:
   The Association will provide electric service within the boundaries of its service area when (i) all appropriate legal rights-of-way or easements have been furnished to the Association via the Association’s standard easement form or other document provided to applicant by the Association, and (ii) the applicant complies with all applicable conditions of one of the following classifications, as determined by the Association. Once provided, the Association will own, operate and maintain all extension facilities constructed pursuant to this policy.
   1. "Permanent" as herein defined shall include, without limitation, electric service to residential, irrigation, general service and commercial applicants, when permanent and indefinite use of electric service can be assured by the Association.
   2. "Indeterminate" as herein defined shall include, without limitation, those services that are transitory in nature, which may be specified by the applicant or determined by the Association at its sole and absolute discretion. Electric service to mines, quarries, or other enterprises where there is little or no immediate demand for service by applicant, seasonal services, and other services where the amount and permanence of use cannot reasonably be assured shall be considered to be "Indeterminate".
   3. "Temporary" as herein defined includes, without limitation, electric services to fairs, concessions, and similar enterprises, services for construction work, and all other services which are of a temporary nature, as determined by the Association in its sole and absolute discretion.
3. Line Connections:
   1. General Requirements. For connection of electric service to all connection classes, as defined in Section 2 above, the following shall apply:
      1. A construction advance covering the costs of construction of the electric service facility (a "Construction Advance") will be required to cover 100% of the estimated construction costs. Construction Advances will be calculated based on the estimated construction costs as determined by the Association.
      2. A non-refundable engineering fee will be charged before an estimate is calculated.
      3. Any difference between actual and estimated costs will be either billed or refunded to the applicant at the discretion of the Association.
      4. If subsequent consumers are connected to the line extension during the first three (3) years from the date the Association makes Power Available, a refund may be made to the applicant who initiated the extension or to the successor owner of the property. If a new service is connected to a line on which a Construction Advance has been made, the new applicant shall pay a pro-rata share of the original Construction Advance if such occurs within thirty six (36) months after construction of the line.
      5. Any new primary line extension made to the end point of a preceding extension will be considered a separate extension and will not affect the previous extension contract. The Association, at its sole discretion, may retain a portion of the line extension cost when multiple accounts are being served or planned for future service. In such cases, no refund will be made.
      6. Developers of subdivisions, master planned communities, phased developments, or other similar parceled developments shall provide the Association with a performance guaranty in the form of a surety bond, letter of credit, or similar financial instrument. Such instrument will be held by the Association for two (2) years and will be used to cover costs which may be incurred by the Association to repair or replace damaged facilities resulting from improper or inadequate work performed by developer or developer’s agent.
   2. Permanent Facilities. For connection of electric service to Permanent Facilities, as defined in Section 2 above, the following shall apply:
      1. Applicants shall provide surveyed property corner stakes for determination of proper power line locations.
      2. Specific load information shall be provided by the applicant and shall be included with all applications for connection.
      3. After Approved Plans have been received by the Association, notification of any changes to applicant's Approved Plans must be received by the Association in a timely manner and will be subject to a "Change Order Charge", as determined by the Association.
      4. Planned Unit Developments ("PUDs") shall provide all documentation as may be required by the Association with regard to easements, site-plans, property pins, grade stakes, and all other similar items relating to the PUD. The Approved Plans for all PUDs must be properly recorded with the proper jurisdictional authority and will be subject to an engineering fee based on the number of units to be served at the time of the request for service. PUD applicants may be required to pay an additional charge, in addition to other charges which may be required for such extension, pursuant to other sections of this policy.
      5. Units within a subdivision may be required to pay additional fee(s), in addition to other charges, which may be required for such extension pursuant to other sections of this policy.
   3. Indeterminate Facilities: For connection of electric service to Indeterminate Facilities, as defined in Section 2 above, the following shall apply:
   1. All Indeterminate Facilities shall require an up-front cash contribution to the Association in an amount equal to the estimated cost of installation and removal (up and down charges) of the extension, less any salvage value. The cost of installation shall include the cost of the transformers and meters.
   2. An Indeterminate Facility that qualifies as a Permanent Facility within one (1) year will be eligible to convert to a Permanent Facility and receive a refund for any excess contribution previously made.
   3. Indeterminate Facility service charges shall be billed on the applicable rate and conditions of service while it is in place.
   4. Temporary Facilities: For connection of electric service to Temporary Facilities, as defined in Section 2 above, the following shall apply:
   1. All Temporary Facilities shall require an up-front cash contribution to the Association in an amount equal to the estimated cost of installation and removal (up and down charges) of the extension, less any salvage value.
   2. Service provided to a Temporary Facility shall be billed in accordance with the applicable rate schedule and conditions of service while it is in place.
   3. The Association may refuse to connect additional applicants to any Temporary Facility.
   4. Unless otherwise determined by the Association as provided herein, the Association will not provide electric service over a Temporary Facility for a period longer than one (1) year. If the applicant desires electric service thereafter, continued service shall be furnished under the terms of either the Permanent Facilities service or Indeterminate Facilities service, if the Association's estimate of the future use of service justifies the continued operation and maintenance of the line. The Association, at its discretion, will only consider extending electric service to a Temporary Facility for a period longer than one (1) year if a written request for a time extension is delivered to the Association by the applicant.
   5. Idle Facilities:
   6. Existing facilities or facilities constructed at applicant’s request with Power Available shall be billed on the first billing date following the construction of the line. Where metered service has not been requested by the applicant within one (1) year from the date of notification by the Association that power is available, applicant shall be subject to the removal or retirement of the facility, at the sole and absolute discretion of the Association. Additional rules relating to idle services are contained in Policy 19.
4. Underground Facilities Service:
   Primary and/or secondary underground facilities will be installed when feasible or as otherwise required. Each applicant for underground facilities shall pay a Construction Advance of 100% of the estimated costs of construction for the primary and/or secondary power lines and related power equipment. The following terms apply to both Residential and Commercial underground facilities:
   1. Residential - The Association will install, own and maintain all underground primary and secondary conductors for 400A and below rated installations. The applicant shall be responsible for all trenching and conduit required for service from the applicant’s metering point back to the Association’s existing primary or secondary facilities. The Association shall provide, install and own secondary conductors from its facilities to the metering point. Applicant's installation and construction must meet the specifications of the Association.
   2. Commercial -Applicant is responsible for all excavation, trenching, conduit, pads, vaults, secondary junction boxes, grounds, secondary conductors, bedding material, back fill of trenches, ground restoration and other non-primary materials as may be required beyond the Association’s facilities. Applicant's installation must meet the accepted industry inspection standards of the Association.
1. Large Industrial Loads:
   Large industrial loads involving special construction or circumstances will be individually analyzed and approved by the Association on a case-by-case basis. To the extent applicable, all of the provisions of this Policy 17 may apply at the discretion of the Association.
2. Impact Fees:
   All applicants for new electric service and all reconnections of idle electric services are subject to payment of an impact fee as per Schedule A of this Policy 17.
3. Connection fee:
   All applicants for new electric service and all reconnections of idle electric services are subject to a connection charge as per Schedule A of this Policy 17.
4. Energy Efficiency Performance Discount:
   The Association may establish an energy efficiency performance discount (an "EEPD") or other mechanism which may provide credits to applicants who are subject to impact fees. The EEPD will recognize quantifiable energy efficiency upgrades as may be determined by the Association from existing energy code performance standards. The discount may be adjusted from time to time and shall only be applied to impact fees as per Schedule B of this Policy 17.
5. Authority to Waive:
   The board of directors of the Association reserves the right to waive by formal board action any or all of the provisions of this Line Connection Policy in the event special conditions arise or exist.

Approved: ______________________________ Secretary of the Board

Schedule "A" Impact Fees
September 27, 2007

Service Size - Fee

Residential and Single phase Small Commercial (Overhead & Underground System Connection)

15 kVA............................................................................................. $2,325.00
25 kVA............................................................................................. $3,875.00

All Commercial, Irrigation, General Service, etc.
Installed Capacity (per kVA).............................................................$155.00

Upgrading of existing service will require the applicable impact fees to be paid.
CONNECT FEES All Services..............................................................$60.00

Schedule "B" Energy Efficiency Performance Discounts
September 27, 2007

Energy Efficiency Performance Discount (EEPD)

Residential.............................................................................. $TBD.00

Commercial............................................................................. $TBD.00

Irrigation ............................................................................... $TBD.00

Industrial ............................................................................... $TBD.00

Applicable EEPDs are applied against impact fees in recognition of quantifiable reductions in energy and demand impacts resulting from qualified implemented measures. Impact and connect fees, and energy efficiency discounts are subject to change as necessary. Such necessity to be determined by the board of directors of Valley Electric Association, Inc.