Hot Topics: Creative Power Contracting Jody Lamar Finklea Jody Lamar Finklea Assistant General Counsel and Manager of Legal Affairs Assistant General Counsel and Manager of Legal Affairs Florida Power Municipal Agency Florida Power Municipal Agency Orlando, FL. Orlando, FL. Robert L. Daileader Robert L. Daileader Partner Partner Nixon Peabody LLP Nixon Peabody LLP Washington, D.C. Washington, D.C.

New Approaches to Power Contracting The Debate as to Ownership of Generation vs. Purchased Power The Debate as to Ownership of Generation vs. Purchased Power The Changing View of Generating Capacity in an Increasingly Competitive Market The Changing View of Generating Capacity in an Increasingly Competitive Market The Convergence of Physical and Financial Products The Convergence of Physical and Financial Products

The Lease PPA Essential Features of a Lease PPA Essential Features of a Lease PPA Key Risk Allocation Features Key Risk Allocation Features Why a Lease PPA Rather Than a Unit Specific Power Purchase Agreement? Why a Lease PPA Rather Than a Unit Specific Power Purchase Agreement? Advantages of the Lease PPA from the Purchaser’s Perspective Advantages of the Lease PPA from the Purchaser’s Perspective

Call Option Agreements Essential Feature of Agreements – Seller Has Obligation to Provide Firm Energy from Any Resource or Pay Liquidated Damages Essential Feature of Agreements – Seller Has Obligation to Provide Firm Energy from Any Resource or Pay Liquidated Damages Agreement Provides a Financial Hedge to Mitigate Purchaser’s Price Risk Agreement Provides a Financial Hedge to Mitigate Purchaser’s Price Risk Seller Retains Maximum Flexibility to Manage Its Supply Portfolio – Capacity Is Not Committed to a Specific Purchaser Seller Retains Maximum Flexibility to Manage Its Supply Portfolio – Capacity Is Not Committed to a Specific Purchaser