Central Kentucky Transmission Company

Original Volume No. 1

Effective Date: 05/01/2006, Docket: CP05- 48-002, Status: Effective

Original Sheet No. 51 Original Sheet No. 51 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

3.8 Assurance of Payment. If Transporter denies a request for service or

does not approve the placement of Requestor's name on the Approved Bidder

List due to a failure to satisfy Transporter's creditworthiness

requirements, Requestor may obtain service or be placed on the Approved

Bidder List if it provides Transporter with assurance of payment in the

manner set forth at Section 3.9 below and otherwise complies with the

ongoing creditworthiness requirements set forth in Section 3.9. If

Requestor fails to tender such assurance of payment within 10 days, or such

longer time period reasonably established by Transporter, Transporter may

deny Requestor's request for service or reject any bid submitted by

Requestor.

3.9 Creditworthiness of Shipper.

(a) Subject to the provisions of paragraphs (b) and (c) immediately

below, Transporter shall not be required to perform or to continue to

perform service on behalf of any Shipper that (i) is or has become

insolvent, (ii) has applied for bankruptcy under Chapter 11 of the

Bankruptcy Code or is subject to similar proceedings under State or Federal

Law, or (iii) fails, in Transporter's reasonable judgment, to demonstrate

minimal creditworthiness for all or any part of the service requested,

based upon Transporter's consideration of available credit data concerning

Shipper and Shipper's past payment history, financial statements, and

credit reports.

(b) Transporter may require adequate assurance of payment for any

service under this Tariff requested by an insolvent or uncreditworthy

Shipper. Such a Shipper may receive or continue to receive service if it

provides adequate assurance of payment for service within 15 days after the

date of written demand by Transporter. Adequate assurance of payment may

include:

(1) deposit with Transporter of an amount equal to three months

of demand and commodity charges for the service, as set forth in the

applicable Service Agreement, provided that such deposit may be applied

by Transporter to satisfy a delinquent account, and any deposit held by

Transporter shall accrue simple interest at the Federal Funds Rate.

Upon request by Shipper, Transporter will remit the balance of such

interest to Shipper within thirty days, provided, however, that

Transporter shall not be required to remit interest to Shippers more

often than every thirty days;