(I) THE EXISTING FACILITIES INSTALLED GENERATING CAPACITY
AS OF JANUARY 1, 1999;

(II) THE GENERATING CAPACITY OF AN EXISTING FACILITY TO BE
INSTALLED UNDER A LEGALLY BINDING CONTRACT:

1. EXECUTED ON OR BEFORE JANUARY 1, 1999; OR

2. EXECUTED ON OR BEFORE SEPTEMBER 29, 1999, IF THE
COMMISSION, ON A CASE BY CASE REVIEW OF THE EVIDENCE, DETERMINES THAT
NEGOTIATIONS IN GOOD FAITH CONCERNING THE CONTRACT WERE ONGOING AS OF
JANUARY 1, 1999; OR

(III) FOR A FACILITY WITH A CAPACITY OF 500 KILOWATTS OR LESS:

1. THE FIRST 80 MEGAWATTS OF THE AGGREGATE
STATEWIDE GENERATING CAPACITY OF ON-SITE GENERATING FACILITIES;

2. THE GENERATING CAPACITY OF THE FACILITY IF THE

FACILITY:

A. IS INSTALLED BETWEEN JANUARY 1, 2000 AND DECEMBER

31, 2003;

B. DERIVES ELECTRICITY FROM FUEL CELLS,
PHOTOVOLTAICS, WIND MACHINES, OR MICROTURBINES; AND

C. HAS AN ENERGY CONVERSION EFFICIENCY GREATER

THAN 40%; OR

3. THE GENERATING CAPACITY OF THE FACILITY IF THE

FACILITY:

A. IS INSTALLED AFTER JANUARY 1, 2004;

B. DERIVES ELECTRICITY FROM FUEL CELLS,
PHOTOVOLTAICS, WIND MACHINES, OR MICROTURBINES; AND

C. HAS AN ENERGY CONVERSION EFFICIENCY GREATER

THAN 50%.

(B) THE COMMISSION SHALL DETERMINE THE TRANSITION COSTS AND THE
AMOUNTS OF THE TRANSITION COSTS THAT AN ELECTRIC COMPANY SHALL BE
PROVIDED AN OPPORTUNITY TO RECOVER UNDER ITS RESTRUCTURING PLAN
THROUGH THE COMPETITIVE TRANSITION CHARGE OR OTHER APPROPRIATE
MECHANISM.

(C) (1) AFTER JULY 1, 1999, AN ELECTRIC COMPANY MAY APPLY TO THE
COMMISSION FOR A QUALIFIED RATE ORDER FOR SOME OR ALL OF ITS TRANSITION
COSTS.

(2) IF THE COMMISSION ISSUES A QUALIFIED RATE ORDER AND THE
TRANSITION BONDS APPROVED BY THAT ORDER ARE SUCCESSFULLY ISSUED: