Portland General Electric Company

Original Volume No. 1

Effective Date: 12/03/2003, Docket: RP04- 48-000, Status: Effective

Original Sheet No. 89 Original Sheet No. 89 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

19. RECEIPT AND DELIVERY FACILITIES (Continued)

materials, and such construction will be subject to approval by

Transporter's inspectors. Shipper will make a lump sum payment to

Transporter for all costs associated with Transporter's design

review and inspection of the facilities within 30 days of

Transporter submitting an invoice detailing such costs. Interest

calculated in accordance with 18 CFR Section 154.501(d) will

accrue on any balance remaining after the due date specified in

the invoice. Shipper assumes full responsibility and liability

and agrees to hold Transporter harmless from any liability of any

nature arising from the installation of such facilities by Shipper

or by a third party for Shipper.

19.3 Facilities Reimbursement. All receipt or delivery facilities

constructed by Transporter hereunder will be paid for by Shipper as

provided below:

(a) Unless Transporter and Shipper otherwise mutually agree to the

procedures set forth in Section 19.3(b) below, Shipper will reimburse

Transporter in full upon completion of construction for the actual

construction costs of facilities constructed by Transporter, and

related income taxes; or

(b) Shipper will reimburse Transporter for the cost of service

attributable to subject facilities through a facilities

surcharge under a valid transportation service agreement.

Determination of the initial cost of service shall be consistent

with the principles underlying Transporter's currently effective

transportation rates at the time Transporter and Shipper execute

an agreement for the construction of the facilities. Such

applicable cost of service will be adjusted prospectively to

reflect Commission-approved cost factors, including only

operation and maintenance and administrative and general costs

actually incurred as a result of the new facilities.

Transporter and Shipper may agree on a rate method which

provides flexibility regarding method of payment and timing of

recovery of the cost of service for the facilities. Shipper may

select from the following rate methodologies for determination

of its facilities surcharge:

(1) volumetric rates;

(2) monthly cost-of-service charges;

(3) levelized rate payments; or

(4) a combination of reservation and volumetric

charges.