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LONG-TERM AGREEMENT
TV-_________A, Supp. No. ___
This Agreement is between the DISTRIBUTOR (“Distributor”), a [State of Incorporation or Registration] & [Type of
Entity], and TENNESSEE VALLEY AUTHORITY (“TVA”), a corporate agency and instrumentality of the United
States of America, created and existing under and by virtue of the Tennessee Valley Authority Act of 1933, as
amended.
Distributor purchases all of its power requirements from TVA for resale under contract number TV-xxxxA, effective
[DATE1], as amended (“Power Contract”).
The parties hereby agree to amend the Power Contract to increase the length of and strengthen the contractual
relationship to help ensure the long-term success of the public power model, as follows:
SECTION 1 - NOTICE OF POWER CONTRACT TERMINATION
The section of the Power Contract entitled "Term of Contract” is hereby replaced, in its entirety, with the
following:
This contract is effective as of [DATE1], and will continue in effect for an initial term of 20 years from
[DATE1], provided, however, that beginning on the first anniversary of said effective date, and on each
subsequent anniversary thereof (whether falling during said initial term or any renewal term as provided
for herein), this contract shall be extended automatically without further action of the parties for an
additional 1-year renewal term beyond its then-existing time of expiration. Notwithstanding any other
provision of this section, [Cooperative/Municipality] may terminate this contract at any time upon not less
than 20 years' prior written notice, and TVA may terminate this contract upon not less than 20 years’ prior
written notice. If [Cooperative/Municipality] delivers a notice of termination to TVA, as stated above, then
from and after its date of receipt of such notice, TVA will have no obligation to make or complete any
additions to or changes in any transformation or transmission facilities for service to
[Cooperative/Municipality], unless (by means of a fully-executed amendment to this contract)
[Cooperative/Municipality] agrees to reimburse TVA for its non-recoverable costs in connection with the
making or completion of such additions or changes.
SECTION 2 - BENEFITS
Under the section of the Power Contract entitled “Power Supply,” and according to the Power Contract, as
amended, TVA commits to produce and deliver, and Distributor agrees to take and distribute, provide all of the
power supplied to consumers in the Distributor’s service area. Recognizing the 20-year initial term and the 20years’ termination notice provision established in section 1 of this Agreement, and the other mutual commitments
stated in this Agreement, the parties agree to the following:
(a) For purposes of this Agreement, “Applicable Rates” means base rates that are subject to adjustment
and are supplied by TVA in accordance with: the “Standard Service” section of the Wholesale Power
Rate--Schedule [WS/WSA] (currently on-peak demand, maximum demand, grid access, and non-fuel
energy charges), and Schedule TDGSA and Schedule TDMSA only (currently on-peak demand,
maximum demand, and all non-fuel energy charges), of the “TOU Service” section of the Wholesale
Power Rate--Schedule [WS/WSA].
Beginning with the first full billing month following the Effective Date, TVA will apply a credit to the
Distributor’s monthly power invoice equal to 3.1% of the amount that Distributor pays TVA through the
Applicable Rates (“Wholesale Credit”).

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Deleted: , at rates as low as feasible, consistent with the
public power model

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Beginning in the TVA fiscal year during which TVA first pays the Wholesale Credit to Distributor, if both of
the following conditions occur:
1) TVA increases the Applicable Rates: (i) by more than 10% (calculated based on the adjustment to
Applicable Rates that is applied across all power distributors served by TVA) during any consecutive
five-fiscal-year period that begins after the Effective Date and occurs within 20 years of the Effective
Date, compared to the Applicable Rates that are applied as of the end of the TVA fiscal year
immediately preceding that consecutive five-year period, or (ii) by more than 5% (calculated based on
the adjustment to Applicable Rates that is applied across all power distributors served by TVA),
compared to the Applicable Rates that are applied as of the end of TVA fiscal year 2019, prior to
September 30, 2024; and
2) the parties, after good faith negotiations for up to 180 days after the date that either condition
described in subsection 2(a)(1) of this Agreement is met, fail to re-negotiate the terms of this
Agreement;
then, if Distributor notifies TVA in writing within 60 days from the end of the 180 day period established in
subsection 2(a)(2) of this Agreement, the termination notice period in subsection (a) of the "Term of
Contract” section of the Power Contract will be reduced to 10 years, as confirmed in a written amendment
executed by the parties, and this Agreement will terminate.

Deleted: the parties will execute an amendment to the
Power Contract, which reduces

(b) No calculation or determination of Applicable Rates, or any increases or adjustments to Applicable Rates,
described in or occurring pursuant to subsection 2(a)(1) of this Agreement, will include or account for rate
changes designed to be revenue-neutral to TVA in the aggregate, or changes in the fuel cost adjustment,
which apply to or impact Distributor during the term of the Power Contract.
(c) If Distributor delivers a notice of termination to TVA under the “Term of Contract” section of the Power
Contract, then, as of the first full billing month following TVA’s receipt of said notice, section 2 of this
Agreement will terminate, except that the then-effective Wholesale Credit will be reduced and phased out
in equal percentages over each of the following 10 years, with the first equal percentage reduction
beginning on the first day of the billing month immediately after Distributor delivers a notice of termination
to TVA and reducing to 0% on the first day of the billing month that is 121 months after Distributor delivers
such notice.
(d) During the term of this Agreement, TVA will notify Distributor in writing of additional benefits that TVA
elects, in its sole discretion (for example but without limitation, adjustment of the Wholesale Credit
percentage above 3.1%), to offer to other distributors of TVA power because they have executed a longterm agreement under substantially the same terms as this Agreement. Distributor will receive the
additional benefits, unless Distributor declines by written response to TVA within 90 days of Distributor’s
receipt of TVA’s notice. In addition, TVA will establish a process of engagement with Distributor for
strategic resource and financial planning decisions.
(e) TVA commits to collaborating with Distributor (and other distributors of TVA power who have executed a
similar long-term agreement) to develop and provide enhanced power supply flexibility, with mutually
agreed-upon pricing structures, for 3-5% of Distributor’s energy, by no later than October 1, 2021. If in
either of the following cases: (i) TVA does not fulfill its commitment to propose a power supply flexibility
solution by the date stated above; or (ii) Distributor does not agree to the TVA-proposed power supply
flexibility solution, then, Distributor may elect, by written notice to TVA not later than 90 days from the
TVA Board approved implementation date, to terminate this Agreement. Upon Distributor’s payment to
TVA of an amount equal to 50% of the sum of all Wholesale Credit amounts received by Distributor
pursuant to subsection 2(a), this Agreement terminates, and the term of the Power Contract, as it existed
immediately prior to the Effective Date, and as amended by the section(s) referenced in section 4(b) of
this Agreement, below, is reinstated. The payment amount due from Distributor to TVA under this
subsection 2(e) will be calculated as of the date TVA receives said notice.
SECTION 3 - EVENTS OF DEFAULT AND REMEDIES
(a) Assignment. “Assign” or “Assignment” means a party’s transfer or disposal of this Agreement, in whole
or in part, or any interest in it, to any person or entity that is not a party, including use of this Agreement or
any payment or performance obligations under it as collateral.
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(b) “Applicable Laws” means those U.S. federal and state laws, regulations, and judicial or administrative
decisions, orders (including, without limitation, administrative authority or commission consent orders and
confirmatory orders) or injunctions, or any other legal pronouncements of a U.S. federal governmental
authority that have the force or effect of law as of the Effective Date; provided, however, that in no event shall
this provision be interpreted as subjecting TVA to any state or federal laws, including any remedies available
under such laws, that otherwise do not apply to TVA.
(c) Distributor Events of Default. An Event of Default, with respect to Distributor, means one or more of the
following:
1) A sale or transfer of all, or substantially all, of Distributor’s tangible or intangible assets that results in
a reduction in load served by TVA;
2) Distributor’s sale or supply of power not supplied by TVA, or Distributor’s facilitation of the sale or
consumption of power not supplied by TVA by any Distributor affiliate or third party, to or by any enduse customer in Distributor’s service area, without TVA’s consent prior to the Effective Date or
advanced written consent after the Effective Date; or
3) Distributor’s Assignment of the Power Contract without TVA’s prior written consent.
(d) TVA Events of Default. An Event of Default, with respect to TVA, means one or more of the following:
1) TVA’s breach of its obligations or commitments in subsection 5(a) of this Agreement; or
2) TVA’s Assignment of the Power Contract without Distributor’s prior written consent.
(e) Notice. If an Event of Default occurs, the non-defaulting party must notify the defaulting party in writing,
and the defaulting party may cure its Event(s) of Default within 60 days of its receipt of such written notice
from the non-defaulting party..
(f) Remedies. Upon expiration of the cure period established in subsection 3(e), above, the non-defaulting
party (as applicable) may exercise the remedies stated below for an Event of Default, provided that it also
must mitigate its losses in a commercially reasonable manner:

Deleted: does not
Deleted: , then (as applicable) the non-defaulting party
may exercise any of the remedies stated in subsection 3(e)
of this Agreement, in addition to those remedies available
under the Power Contract or pursuant to Applicable Laws

1) Distributor must pay TVA an amount equal to TVA’s actual or estimated net losses of revenue and
load served, and for all actual or estimated expenses incurred by TVA and resulting from Distributor
Event(s) of Default (subsection 3(c) of this Agreement), including attorneys’ fees and other regulatory
or administrative costs, measured from the date that any Event of Default first occurs, and over the
remaining term of the Power Contract.
2) TVA must pay Distributor an amount equal to the increase in Distributor’s actual or estimated costs
paid for electric power production and transmission (including wheeling, if applicable), resulting from
TVA Event(s) of Default (subsection 3(d) of this Agreement), including attorneys’ fees and other
regulatory or administrative costs, measured from the date that any Event of Default first occurs, and
over the remaining term of the Power Contract, provided that Distributor’s claims to payment of any
such amounts upon a TVA Event of Default are subordinate to TVA’s prior satisfaction of any and all
obligations it has to the holder of any bonds or other financing obligations issued or entered into by
TVA, either before or after the Effective Date.
3) The non-defaulting party may, by separate written notice to the defaulting party, terminate this
Agreement if one or more of the defaulting party’s Event(s) of Default occurs, in which case, the term
of the Power Contract, as it existed immediately prior to the Effective Date, and as amended by the
section(s) referenced in section 4(b) of this Agreement, below, is reinstated.
(g) Mutual Waiver. Neither party’s waiver of the other party’s breach of the Power Contract, or failure to
claim or enforce its remedies upon an Event of Default, will be construed to waive any other or
subsequent breach or right to claim or enforce an Event of Default. Neither party's acceptance nor
consideration of any untimely notice or information from the other party waives any time limits or schedule
deadlines stated in, or issued, or agreed upon pursuant to the Power Contract.
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Deleted: in this Agreement

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(h) Rights and Remedies Cumulative. Either party has the right to pursue any and all rights available at law
or in equity, or under the Power Contract, in the event the other party fails to perform or otherwise
breaches any term of the Power Contract not specifically referenced above. Except for the remedies upon
Event(s) of Default, established in subsection 3(f) of this Agreement, all rights and remedies afforded
either party under this Agreement are cumulative, in addition to every other right and remedy provided
under the Power Contract, by law or in equity.

Deleted: under Applicable Laws

SECTION 4 - SUPERSEDING AND VOIDING OF PRIOR AGREEMENTS
As of the Effective Date:
(a) In the event that the terms of this Agreement conflict with existing agreements between Distributor and
TVA, the terms of this Agreement control; and
(b) the following sections are of no further force and effect:
1) Section 5 of TV-________A, Supp. No. __, dated October 1, 1989; and
2) Section 2 of Supplement No. ___ to the Power Contract, dated October 1, 1997.
SECTION 5 - CHANGE IN LAW
(a) During the term of the Power Contract, TVA commits that, in the case of a disposal of any substantial
portion of TVA’s power generation or transmission properties, Distributor will not be charged rates for
energy or transmission that are not established in accordance with the Tennessee Valley Authority Act,
16 U.S.C. § 831, et seq., as amended and in effect on the Effective Date (specifically, but without
limitation, Section 15d(f) of that statute) (“TVA Act”).
(b) Nothing in this Agreement will be construed to limit the sovereign authority of the United States Congress,
amend the TVA Act, or impair TVA’s obligations under its bonds or other financing obligations, including
its obligations under the Basic Tennessee Valley Authority Power Bond Resolution, as amended (“Basic
Bond Resolution”). The charges for electric service under the Power Contract are currently established
to recover the costs and financial obligations associated with investment to provide wholesale power
service as required by the TVA Act, and the Basic Bond Resolution. In the event that a change in
Applicable Laws impairs any contractual right, benefit, or interest of either party, or imposes any material
increase in cost, or reduction in allocation of capacity or energy, or otherwise materially changes an
obligation on either party under the Power Contract, the parties shall promptly meet and discuss in good
faith regarding possible changes to the Power Contract to mitigate the impact of the change in Applicable
Laws. The rights and remedies under this section of the Agreement are cumulative and in addition to, not
exclusive of or in substitution for, any other rights and remedies available at law or in equity.
SECTION 6 - NOTICES
The parties will deem any notice required by this Agreement to be properly given if the required notice is delivered
in writing to the address specified below: personally, by recognized overnight courier service, by United States
Mail, postage prepaid, or by electronic mail.
To Distributor:
To TVA:

Email: _______________________
Director, Power Customer Contracts, WT 9D-K
Tennessee Valley Authority
400 West Summit Hill Drive
Knoxville, Tennessee 37902-1401
Email: contractnotices@tva.gov

Any party may change either the designation of any person or the address of any such person at any time and
from time to time by similar notice.

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Deleted: law

Deleted: law
Deleted: under

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SECTION 7 - SEVERABILITY
In the event that any provision of this Agreement is found to be legally unenforceable, such provision will be
replaced with a substitute provision that most nearly reflects the original intentions of the parties and is legally
enforceable, and the remainder of this Agreement will continue in full force and effect.
SECTION 8 - RELATIONSHIP OF THE PARTIES
No provision of this Agreement or the Power Contract creates or will be deemed to create an agency, partnership,
joint venture between Distributor and TVA, or any business relationship between the parties other than that
specifically stated in the Power Contract. Neither party has the power or authority to legally bind the other party,
or to assume or create any express or implied obligation or responsibility on behalf of the other party.
SECTION 9 - RATIFICATION OF POWER CONTRACT
The parties hereby ratify and confirm that the Power Contract, as amended by this Agreement, is their continuing
obligation.
The parties are signing this Agreement to be effective on the date of TVA’s signature (“Effective Date”).
DISTRIBUTOR

By ________________________________
Title: ______________
Date: ______________
TENNESSEE VALLEY AUTHORITY

By ________________________________
Director
Power Customer Contracts
Date: ______________

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