Interconnection Service Agreement

Wholesale Market Participation Agreement

Service Agreement No.

PJM Queue #

WHOLESALE MARKET PARTICIPATION AGREEMENT

By and Among

PJM Interconnection, L.L.C.

And

AC Power, LLC

And

Atlantic City Electric Company

This Wholesale Market Participation Agreement (“WMPA”) including the Specifications, and Schedules attached hereto and incorporated herein, is entered into in order to effectuate sales of energy and/or capacity into PJM’s wholesale markets, by and between PJM Interconnection, L.L.C., the Regional Transmission Organization for the PJM Region (“Transmission Provider”), (“Wholesale Market Participant”) and (“Transmission Owner” or “ACE”) (referred to individually as “Party” or collectively as “the Parties”).

WITNESSETH

WHEREAS, Wholesale Market Participant is developing generation that it intends to use to engage in Wholesale Transactions in PJM’s markets and desires to maintain its proposed generation in the queue that PJM studies for potential reliability impacts to the Transmission System;

WHEREAS, Wholesale Market Participant is seeking to interconnect at a local distribution or sub-transmission facility, which at this time is not subject to FERC jurisdiction; and

WHEREAS, Wholesale Market Participant and Transmission Owner or its affiliate must enter into a separate two-party interconnection agreement (“Interconnection Agreement”) in order to address issues of physical interconnection and local charges that may be presented by the interconnection of Wholesale Market Participant’s generation to the distribution facility.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, together with other good and valuable consideration, the receipt and sufficiency is hereby mutually acknowledged by Transmission Provider, Transmission Owner and Wholesale Market Participant and the parties agree to assume all of the rights and obligations consistent with the rights and obligations relating to Network Upgrades, Local Upgrades and metering requirements set forth in Part VI of the Tariff, as of the effective date of this WMPA, required for Wholesale Market Participant to make Wholesale Transactions in PJM’s markets. The Parties mutually covenant and agree as follows:

Article 1 – DEFINITIONS and OTHER DOCUMENTS

1.0 Defined Terms. All capitalized terms herein shall have the meanings as set forth in the definitions of such terms as stated in Part I, Article 1 or Part VI of the PJM Open Access Transmission Tariff (“Tariff”), except Wholesale Market Participant which shall be defined in this WMPA as a participant in a Wholesale Transaction.

1.1 Effective Date. This WMPA shall become effective on the date it is executed by all Parties, or, if this WMPA is filed with FERC unexecuted, upon the date specified by FERC.

1.2 Assumption of Tariff Obligations. Wholesale Market Participant agrees to abide by all rules and procedures pertaining to generation and transmission in the PJM Region, including but not limited to the rules and procedures concerning the dispatch of generation or scheduling transmission set forth in the Tariff, the Operating Agreement and the PJM Manuals.

1.3 Incorporation Of Other Documents. All portions of the Tariff and the Operating Agreement pertinent to the subject matter of this WMPA and not otherwise made a part hereof are hereby incorporated herein and made a part hereof.

Article 2 - NOTICES and MISCELLANEOUS

2.0 Notices. Any notice, demand or request required or permitted to be given by any Party to another and any instrument required or permitted to be tendered or delivered by any Party in writing to another may be so given, tendered or delivered by recognized national courier or by depositing the same with the United States Postal Service, with postage prepaid for delivery by certified or registered mail addressed to the Party, or by personal delivery to the Party, at the address specified below. Such notices, if agreed to by the Parties, may be made via electronic means, with e-mail confirmation of delivery.

Transmission Provider:

PJM Interconnection, L.L.C.

2750 Monroe Blvd.

Audubon, PA 19403-2497

Wholesale Market Participant:

AC Power, LLC

465 Grand Street, Suite 5

New York, NY 10002

Attn: Ms. Annika Colston

Email:

Phone:

Transmission Owner:

Atlantic City Electric Company / Pepco Holdings

Mail Stop #79NC58

P.O. Box 9239 (US Mail) 401 Eagle Run Road (overnight mail)

Newark, DE 19714-9239 (US Mail) Newark, DE 19702 (overnight)

Phone:

Email:

Attn:

Either Party may change its address or designated representative for notice by notice to the other Parties in the manner provided for above.

2.1 Construction With Other Parts Of The Tariff. This WMPA shall not be construed as an application for service under Part II or Part III of the Tariff.

2.2 Warranty for Facilities Study. In analyzing and preparing the Generation Interconnection Facilities Study, and in designing and constructing the Local Upgrades and/or Network Upgrades described in Part II of the Tariff and in the Specifications attached to this WMPA, Transmission Provider, the Transmission Owner(s), and any other subcontractors employed by Transmission Provider have had to, and shall have to, rely on information provided by Wholesale Market Participant and possibly by third parties and may not have control over the accuracy of such information.

2.3 Waiver. No waiver by any party of one or more defaults by the other in performance of any of the provisions of this WMPA shall operate or be construed as a waiver of any other or further default or defaults, whether of a like or different character.

2.4 Amendment. This WMPA or any part thereof, may not be amended, modified, or waived other than by a written document signed by all parties hereto.

2.5 Addendum of Wholesale Market Participant’s Agreement to Conform with IRS Safe Harbor Provisions for Non-Taxable Status. To the extent required, in accordance with Section 24.1 in Attachment O, Appendix 2 in Part VI of the Tariff, Schedule E to this WMPA shall set forth the Wholesale Market Participant’s agreement to conform with the IRS safe harbor provisions for non-taxable status.

2.6 Assignment.

2.6.1 Assignment with Prior Consent:

2.6.2 Assignment without Prior Consent.

2.6.2.1 Assignment to Owners:

2.6.2.2 Assignment to Lenders:

2.6.3 Successors and Assigns: This WMPA and all of its provisions are binding upon, and inure to the benefit of, the Parties and their respective successors and permitted assigns.

ARTICLE 3 – Responsibility for Network or Local Upgrades

3.0 Security for Network or Local Upgrades. Wholesale Market Participant shall provide Security in the amount of on or before the effective date of this WMPA.

3.1 Project Specific Milestones. During the term of this WMPA, Wholesale Market Participant shall ensure that it meets each of the following milestones:

3.1.1 Substantial Site work completed. On or before , Wholesale Market Participant must demonstrate completion of at least 20% of project site construction.

3.1.2 Commercial Operation. (i) On or before , Wholesale Market Participant must demonstrate commercial operation of generating units.

3.1.3 Documentation. Within one (1) month following commercial operation of generating unit(s), Wholesale Market Participant must provide certified documentation demonstrating that “as-built” Participant Facility are consistent with applicable PJM studies and agreements.

3.1.4 Interconnection Agreement. On or before , Wholesale Market Participant must enter into an Interconnection Agreement with the Transmission Owner in order to effectuate the WMPA.

Wholesale Market Participant shall demonstrate the occurrence of each of the foregoing milestones to Transmission Provider’s reasonable satisfaction.

If the Wholesale Market Participant suspends this WMPA pursuant to this Section 3.1, provide suspension details below:

IN WITNESS WHEREOF

Transmission Provider, Wholesale Market Participant and Transmission Owner have caused this WMPA to be executed by their respective authorized officials.

SPECIFICATIONS FOR WHOLESALE MARKET PARTICIPATION AGREEMENT

1.0 Description of generating unit(s) (the “Participant Facility”) to be used for the provision of wholesale sales into the PJM markets:

a. Name of Participant Facility:

b. Location of Participant Facility:

c. Size in megawatts of Participant Facility:

d. Description of the equipment configuration:

2.0 Rights for Generation Wholesale Market Participant

2.1 Capacity Interconnection Rights:

3.0 Ownership and Location of Metering Equipment. The metering equipment to be constructed, the capability of the metering equipment to be constructed, and the ownership thereof, as required for the Wholesale Transactions shall be identified on the attached Schedule B to this WMPA, and provided consistent with the PJM manuals.

SCHEDULES

Schedule A - Single-Line Diagram

Schedule B - List of Metering Equipment

Schedule C - List of Local/Network Upgrades

Schedule D - Applicable Technical Requirements and Standards

Schedule E - Wholesale Market Participant Agreement to Conform with IRS Safe Harbor Provisions for Non-Taxable Status

Schedule F - Schedule of Non-Standard Terms & Conditions

Schedule C - List of Local/Network Upgrades:

Schedule D - Applicable Technical Requirements and Standards:

Pepco Holdings, Inc. (PHI) Power Delivery Technical Considerations Covering Parallel Operations of Customer Owned Generation Interconnected with the PHI Power Delivery System

Operations and Modifications Requirements of Atlantic City Electric Company, Delmarva Power & Light Company, Potomac Electric Power Company (Pepco) – Companies of Pepco Holdings, Inc.

Schedule E - IRS Safe Harbor Provisions for Non-Taxable Status:

Wholesale Market Participant represents that it meets all qualifications and requirements as set forth in Section 118(a) and 118(b) of the Internal Revenue Code of 1986, as amended and interpreted by IRS Notices.

Schedule F - Schedule of Non-Standard Terms & Conditions: