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Each Owner will notify PNM in writing of its authorized representative who shall advise PNM <br />monthly of such Owner's nomination of Incremental entitlements. Each Owner is fiee to nominate <br />coal in excess of it's Minimum Coal Delivery as either additional Base Price or Incremental Cod. An <br />Owner may elect to nominate coal in excess of such Owner's Minimum Coal Delivery as Base Price <br />to bank such excess Base Price consumption in anticipation of future consumption deficiencies (e.g., <br />due to unit outages). An Owner may elect not to nominate Incremental Price band coal in order to <br />make up Base Price consumption shortfalls from a previous month or months. <br />Individual Owner True Ug <br />At the end of 1996, PNM will produce a true up that will reconcile each individual Owner's <br />fuel expense to a properly allocable share of the total SJCC invoices for the term of this letter <br />agreement. Such true up will be exclusive of any year end true up required between San Juan Project <br />and SJCC per the terms of the CSA. <br />If an Owner has neither nominated nor burned Incremental band coal, such Owner will not <br />have an adjustment made to its fuel expense account. <br />If an Owner has nominated Incremental price band coal, but did not bum the Owner's <br />Minimum Coal Delivery, such Owner will be refunded an amount reflecting such unachieved <br />Incremental price band coal at a rate of $0.675 per MMBtu. <br />Ifan Owner has nominated Base Price coal in excess of the Owner's Minimum Coal Delivery, <br />such Owner shall be refunded the difference between $1.799 and $0.675 per MMBtu on such <br />tonnage. <br />FERC Filing <br />The parties to this letter agreement recognize that it may be deemed to amend and supplement <br />Modification No. 8, and acknowledge that this letter agreement must, therefore, be tendered to the <br />FERC for filing under the Federal Power Act. It is agreed that PNM, as San Juan operating agent, <br />shall promptly after the execution of this letter agreement submit to the FERC an appropriate filing <br />which shall: (i) provide to the FERC an explanation of the reasons for the execution of Invoicing <br />Agreement and ofthis letter agreement; and (ii) request that FERC waive its notice requirements, as <br />authorized by the FERC's regulations, in order to permit PNM to implement, on and after January <br />1, 1996, the above-described new invoicing procedures with respect to the San Juan participants and <br />unit participants. The parties to this letter agreement further agree that in the event the FERC should, <br />for any reason, decline to approve this letter agreement, appropriate supplemental invoices shall be <br />issued by PNM to rebill the Owners in accordance with the provisions of Modification No. 8, The <br />parties acknowledge that any termination of this letter agreement will result in the true up mechanisms <br />described herein being implemented at the conclusion of 1996.