Central Kentucky Transmission Company

Original Volume No. 1

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

Original Sheet No. 181 Original Sheet No. 181 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

19. PENALTIES

The penalties set forth in this Section apply to the FTS and ITS Rate

Schedules, unless otherwise indicated in this Section or in individual Rate

Schedules.

19.1 Takes in Excess of Total Transportation Demand. If Shipper's takes

on any Day exceed 103 percent of its Total Transportation Demand (TD),

Shipper shall be assessed and pay a penalty of $10.00 per Dth for all such

quantities in excess of 103 percent of its TD. This penalty shall not

apply to authorized overruns pursuant to Section 2(c) of Rate Schedule FTS.

19.2 Failure to Interrupt Service. If Shipper fails to interrupt service

as directed by Transporter pursuant to Section 16 (Interruptions of

Service) of the General Terms and Conditions, and thereby delivers gas to

or takes gas from Transporter in excess of 103 percent of the sum of the

lowered Scheduled Daily Receipt Quantity or lowered Scheduled Daily

Delivery Quantity under all applicable Rate Schedules set by Transporter's

interruption order, Shipper shall be assessed and pay penalties of $5.00

per Dth on the first three percent of quantities taken or delivered in

excess of its lowered Scheduled Daily Receipt Quantity or lowered Scheduled

Daily Delivery Quantity, and $10.00 per Dth for quantities taken or

delivered in excess of 103 percent of its lowered Schedule Daily Receipt

Quantity or lowered Daily Scheduled Delivery Quantity. The penalties set

forth in this Section and in Section 19.1 shall not both be assessed for

the same actions by Shipper.

19.3 Failure to Comply with OFOs. If Shipper fails to comply with an OFO

issued by Transporter pursuant to Section 17 (Operational Flow Orders) of

the General Terms and Conditions, a penalty of $5.00 per Dth per day shall

be assessed on all quantities taken or delivered in violation of that OFO.