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HomeMy WebLinkAbout20030147 Ver 2_Approval Letter_200809120 0-s, 'VA O < Michael F. Easley, Governor William G. Ross Jr., Secretary North Carolina Department of Environment and Natural Resources Coleen H. Sullins, Director Division of Water Quality September 12, 2008 Mr. Charles Gates, Vice President - Fossil Generation Progress Energy Carolinas, Inc. 410 S. Wilmington Street Mailcode: PEB 7A1 Raleigh, NC 27601 Re: Yadkin-Pee Dee Project for Tillery and Blewett Falls Reservoirs, Rockingham, Stanly, Anson, Richmond and Montgomery Counties DWQ #2003-0147, Version 2.0; Federal Energy Regulatory Commission Project Number 2206 APPROVAL of 401 Water Quality Certification - Modified Dear Mr. Gates: Attached hereto is a copy of Certification No. 3730 modl issued to Progress Energy Carolinas, Inc. dated September 12, 2008. In addition, you should get any other federal, state or local permits before you go ahead with your project including (but not limited to) Solid Waste, Sediment and Erosion Control, Stormwater, Dam Safety, Non-discharge and Water Supply Watershed regulations. If we can be of further assistance, do not hesitate to contact us. Sincerely, Coleen H. (uls CS/jrd Attachments: Certificate of Completion cc: Mike Lawyer, DWQ, Fayetteville Regional Office Rob Krebs, DWQ Mooresville Regional Office File Copy Central Files Mailing list from Public Hearing Tom Reeder, DWQ Honorable Gene McLaurin, Mayor - City of Rockingham, 514 Rockingham Road, Rockingham, NC 28379 N Carolina J?a-trrra!!y North Carolina Division of Water Quality 1617 Mail Service Center Raleigh, NC 27699-1617 Phone (919) 807-6300 Customer Service Internet: www.ncwaterquality org Location: 512 N. Salisbury St. Raleigh, NC 27604 Fax (919) 807-6492 1-877-623-6748 An Equal Opportunity/Affirmative Action Employer- 50%a Recycled/10% Post Consumer Paper Progress Energy Carolinas, Inc Page 2 of 37 September 12, 2008 Gerrit Jobsis, American Rivers, Southeast Division, 2231 Devine Street, Suite 202, Columbia, SC 29205 Heather Preston, Water Quality Division, Bureau of Water, 2600 Bull Street, Columbia, Adam Rigsbee, Restoration Systems, 1101 Haynes Street, Suite 107, Raleigh, NC 27604 Steve Reed, NC Division of Water Resources Gene Ellis, Alcoa Power Generating Inc., Yadkin Division, P.O. Box 576, Badin, NC 28009-0576 Ms. Kimberly D. Bose, Secretary, Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, DC 20426 Don Laton, NC Attorney General's Office John Suttles, Senior Attorney, Southern Environmental Law Center, 200 West Franklin Street, Chapel Hill, NC 27516 NORTH CAROLINA 401 WATER QUALITY CERTIFICATION THIS CERTIFICATION is issued in conformity with the requirements of Section 401 Public Laws 92-500 and 95-217 of the United States and subject to the North Carolina Division of Water Quality (NCDWQ) Regulations in 15 NCAC 21-1, Section .0500 to Progress Energy Carolinas, Inc. to continue the operation of hydropower dams at Tillery and Blewett Falls Reservoirs in Stanly, Anson, Richmond and Montgomery Counties, North Carolina, pursuant to an application filed on the 11th day of May of 2007, the Comprehensive Settlement Agreement dated June 29, 2007 and in additional correspondence received December 13, 2007. The application and supporting documentation provide adequate assurance that the proposed work will not result in a violation of applicable Water Quality Standards and discharge guidelines. Therefore, the State of North Carolina certifies that this activity will not violate the applicable portions of Sections 301, 302, 303, 308, 307 of PL 92-500 and PL 95-217 if conducted in accordance with the application, the supporting documentation, and conditions hereinafter set forth. This approval is only valid for the purpose and design submitted in the application materials and as described in the Public Notice. If the project is changed, a new application for a new Certification is required. If the property is sold, the new owner must be given a copy of the Certification and approval letter and is thereby responsible for complying with all conditions of this Certification. Any new owner must notify the Division and request the Certification be issued in their name. Should wetland or stream fill be requested in the future, additional compensatory mitigation may be required as described in 15A NCAC 2H .0506 (h) (6) and (7). If any plan revisions from the approved site plan result in a change in stream or wetland impact or an increase in impervious surfaces, the NCDWQ shall be notified in writing and a new application for 401 Certification may be required. For this approval to be valid, compliance with the conditions listed below is required. Conditions of Certification: 1. No waste, spoil, solids, or fill of any kind shall occur in wetlands, waters, or riparian areas beyond the footprint of the impacts depicted in the Certification. All construction activities, including the design, installation, operation, and maintenance of sediment and erosion control Best Management Practices, shall be performed so that no violations of state water quality standards, statutes, or rules occur; 2. Sediment and erosion control measures shall not be placed in wetlands or waters to the maximum extent practicable. If placement of sediment and erosion control devices in wetlands and waters is unavoidable, they shall be removed and the natural grade restored within six months of the date that the Division of Land Resources has released the project; 3. The Applicant shall identify and report in writing existing and proposed consumptive uses to NCDWQ and the NC Division of Water Resources (NCDWR). The Applicant shall report the existing or projected (as appropriate) average consumptive withdrawal and maximum capacity for each withdrawal. The applicant shall report existing consumptive uses to NCDWQ and NCDWR within 60 days of the acceptance of the License and shall report proposed new or expanded consumptive uses to NCDWQ and NCDWR within 30 days of receiving a request for the proposed new or expanded withdrawal and before submitting any requests to Federal Energy Regulatory Commission (FERC). 4. This Certification does not grant or affirm any property right, license or privilege in any waters or any right of use in any waters. This Certification does not authorize any person to interfere with the riparian rights, littoral rights or water use rights of any other person, and this Certification does not create any prescriptive right or any right of priority regarding any usage of water. No person shall interpose this Certification as a defense in any action respecting the determination of riparian or littoral rights or other water use rights. No consumptive user is deemed by virtue of this Certification to possess any prescriptive or other right of priority with respect to any other consumptive user regardless of the quantity of the withdrawal or the date on which the withdrawal was initiated or expanded. This Certification issues on the express understanding of the NC Department of Environment and Natural Resources (NCDENR) that pursuant to Federal Power Act section 27, 16 U.S.C. § 821, the License does not establish or determine a proprietary right to any use of water. It establishes the nature of the use to which a proprietary right may be put under the Federal Power Act. Continuing Compliance: 5. Progress Energy Carolinas, Inc. shall conduct its activities in a manner consistent with State water quality standards (including any requirements resulting from compliance with section 303(d) of the Clean Water Act) and any other appropriate requirements of State law and federal law. If the Division determines that such standards or laws are not being met (including the failure to sustain a designated or achieved use) or that State or federal law is being violated, or that further conditions are necessary to assure compliance, the Division may reevaluate and modify this Certification to include conditions appropriate to assure compliance with such standards and requirements in accordance with 15A NCAC 2H.0507(d). Before modifying the Certification, the Division shall notify Progress Energy Carolinas, Inc. and the Federal Energy Regulatory Commission, provide public notice in accordance with 15A NCAC 21-1.0503 and provide opportunity for public hearing in accordance with 15A NCAC 21-1.0504. Any new or revised conditions shall be provided to Progress Energy Carolinas, Inc. in writing, shall be provided to the Federal Energy Regulatory Commission for reference in any Permit or License issued by that agency and shall also become conditions of the FERC License for the project. In addition, if the DO enhancement program as outlined in the Relicensing Agreement does not result in meeting the DO or temperature water quality standard, then this Condition shall be triggered to result in additional measures to meet these standards. Provided further, if the Division develops and adopts standard success criteria for fish similar to the aquatic macrobenthos criteria referenced at Condition 7.e.i. of this Certification, this Condition may also be triggered to incorporate said standard success criteria. Mitigation: 6. Stream protection, mitigation and enhancement measures as specified in Sections 2.5, 2.6.1.1., and 2.6.2.1. of the Comprehensive Settlement Agreement dated June 29, 2007, shall be implemented. NCDWQ shall be copied on the 2 property transfers, leases, and any related restrictive covenants, for the property described in the Comprehensive Settlement Agreement dated June 29, 2007. Other Conditions 7. Aquatic Life Monitoring Progress Energy Carolinas, Inc. shall conduct post-licensing monitoring of aquatic life below Tillery Dam as outlined below. The purpose of the monitoring is to document the condition of the aquatic community in the Pee Dee River from Tillery Dam to its confluence with the Rocky River. In addition to the water quality monitoring as specified in the Comprehensive Settlement Agreement dated June 29, 2007, the following biological monitoring shall be required by Progress Energy Carolinas, Inc. as outlined in the January 18, 2007, letter from John Dorney of NCDWQ to John Crutchfield of Progress Energy Carolinas, Inc., (subject: Biological monitoring below Lake Tillery to meet water quality standards) and the April 12, 2007, letter from Phillip J. Lucas of Progress Energy Carolinas, Inc., to John Dorney of NCDWQ, responding to the June 29, 2007 letter (subject: Progress Energy Carolinas, Inc. review and comment on proposed biological monitoring below the Tillery hydroelectric plant), including enclosure 1 "Progress Energy Carolinas, Inc. Detailed Technical Comments Regarding Proposed NCDWQ Biological Monitoring of the Pee Dee River from Tillery Dam to Rocky River Confluence." Progress Energy Carolinas, Inc., shall submit for NCDWQ written approval a detailed monitoring plan including a specific monitoring schedule, that addresses, at a minimum, the following items: a. Monitoring Sites - Two sites (TZ1 and TZ2) shall be used with the exact monitoring locations selected after consultation and a site visit by NCDWQ. b. Frequency of Monitoring - Pre-new license and post-new license biological monitoring shall be conducted to establish a baseline condition for the determination of changes attributable to, among other things, improvements in flow and dissolved oxygen. Pre-new license conditions shall be determined prior to implementation of licensed minimum flow, and dissolved oxygen improvements from the project. Post-new license sampling shall be conducted on three (3) year intervals for at least four (4) cycles with written reports provided to NCDWQ. Following the submittal of the written report following the fourth cycle, NCDWQ and Progress Energy Carolinas, Inc. shall consult regarding the need for and any changes to future monitoring. c. Type of Monitoring - Aquatic macrobenthos monitoring shall be conducted using methodology approved by NCDWQ. Fish community sampling shall be conducted using methodology used in the 2004 shallow water study, including tote barge electrofishing, backpack electrofishing, and seining. In addition, the standard physical and chemical monitoring that is routinely done during macrobenthos or fish sampling shall be conducted. d. Timinq of Monitoring - Monitoring shall be conducted during July or August of the years when it is required, and each sampling event shall be conducted during the same three week window during July or August to reduce variability. e. Success/Recovery Criteria i. Aquatic Macrobenthos - Success criteria for aquatic macrobenthos shall be the standard NCDWQ qualitative rating system. Classification of the 3 community at least as "Good-Fair" shall be deemed successful for aquatic macrobenthos. ii. Fish - Fish monitoring data shall be reported in a format to be approved in writing by NCDWQ in order to evaluate the response of the fish community to higher flows and higher dissolved oxygen levels. NCDWQ may develop success criteria for fish, and Progress Energy Carolinas, Inc. will be afforded an opportunity to review and comment on success criteria developed by NCDWQ before the modification provision of Condition 5 of Certification No. 3730 mod1 is triggered. Tripper Date for Biological Criteria Evaluation - Attainment of macrobenthos success criteria shall be measured using analytical data obtained from a sampling event conducted during or before 2020, provided that the 2020 trigger date may be extended upon a showing by Progress Energy Carolinas, Inc., that uncontrollable conditions, such as extended drought or chemical or sewage release, interfered with attainment of the success criteria. Upon such showing, NCDWQ shall set an alternative date. 8. Dissolved oxygen monitoring and improvement - Improvements to the dissolved oxygen in the Yadkin River shall be done in compliance with the Comprehensive Settlement Agreement. However, if dissolved oxygen levels are less than the applicable water quality standard after those improvements) Progress Energy Carolinas, Inc. shall propose additional measures to NCDWQ in order to meet that standard. Such measures as agreed upon in writing by NCDWQ, shall be implemented by Progress Energy Carolinas, Inc. at an agreed-upon schedule. 9. Comprehensive Settlement Agreement - The Comprehensive Settlement Agreement dated June 29, 2007, is hereby incorporated by reference into this Certification, with the exception of Sections 2.4 and 2.6 (except for 2.6.1.1. and 2.6.2.1.) of the Comprehensive Settlement Agreement dated June 29, 2007. The Conditions of Certification No. 3730 mod1 shall control over conditions in the Comprehensive Settlement Agreement dated June 29, 2007, which are inconsistent with this Certification. 10. Progress Energy Carolinas, Inc., shall collaborate with the N.C. Wildlife Resources Commission to make boat ramps at Blewett Falls Lake accessible for public boating use over the range of elevations up to 4 feet below normal full pond elevation (178.1 ft. 1929 NGVD datum). 11. Progress Energy Carolinas, Inc. shall notify NCDWQ in writing within 5 working days of discovery of any deviations to the flow rates and lake level fluctuations as set forth in the Comprehensive Settlement Agreement. Decreased flow shall be restored as soon as practical to the written satisfaction of NCDWQ. 12. NCDWQ shall be copied on the fish and eel passage schedule. The following conditions are taken from the Comprehensive Settlement Agreement dated June 29, 2007 and are hereby incorporated as conditions of this Certification. 1. Minimum Instream Flows and Other Stream Protection Measures A. River Inflows from APGI's Yadkin Hydroelectric Project 4 Progress Energy's obligation to meet the minimum flow releases described herein is contingent upon Progress Energy's Tillery Development receiving specified minimum flow releases from Alcoa Power Generating Inc.'s Yadkin Hydroelectric Project. The following specified minimum levels of inflow to Lake Tillery from Falls Dam are necessary for Progress Energy to meet its minimum flow obligations: February 1 to May 15- 2,000 cfs as measured on an average daily basis; May 16 to May 31 -1,500 cfs as measured on an average daily basis; June 1 to January 31 -1,000 cfs as measured on an average daily basis. B. Blewett Falls Plant 1. Minimum Flow Regime From February 1 through May 15 of each year, the continuous minimum flow will be 2,400 cfs, as measured at the existing USGS gage at Rockingham, to enhance spawning habitat in the Pee Dee River downstream of the Blewett Falls Development. From May 16 through May 31 of each year, a continuous minimum flow will be 1,800 cfs and for the remainder of the year, June 1 through January 31, the continuous minimum flow will be 1,200 cfs, all subject to allowable variances described below. This Certification establishes a higher priority on the maintenance of minimum flows than the maintenance of reservoir water levels. Therefore, infrequently, events may require the prioritization of maintaining minimum flows over the reservoir water levels identified in Section II of the Comprehensive Settlement Agreement. .2. Flow Adjustments to Enhance Fish Spawning Progress Energy shall operate its Blewett Falls facility during certain times of the year in a manner intended to enhance fish spawning conditions downstream of the Blewett Falls Development as described and defined below. These time periods are referred to herein as "flow adjustment operations" and they shall occur each year as either (a) one 14-day and one 10-day period or (b) five 5-day periods. In any event, these periods of flow adjustment to enhance spawning will be characterized by the following: Flow adjustment operations shall occur between February 1 and May 15. The specific time periods in each year will be decided upon by resource agencies, Progress Energy, and Alcoa Power Generating Inc. (APGI) - collectively, the "Spawning Flow Management Team". Other entities able to demonstrate relevant fisheries expertise may participate in these discussions, If the option of one 14-day period and one 10-day period is chosen, Progress Energy must be notified of the specific dates at least 14 days prior to the start of each period. If the option of five 5-day periods is chosen, Progress Energy must be notified of the entire schedule at least 10 days in advance of the start of the first of the 5-day periods. Periods of flow adjustment operations shall be chosen by the Spawning Flow Management Team based on interpretation of relevant factors that might include, but are not limited to, water temperature and weather data, projected inflow conditions, and observations of fish spawning behavior. If the option of five 5-day periods is implemented, two of these periods must occur between April 15 and May 15. 5 Because of concerns regarding the predictability of inflows over longer periods of time, the individual flow adjustment periods must be separated by at least one week, unless otherwise approved by Progress Energy. If a period of unusually low inflow to Blewett Falls Reservoir or a Low Inflow Protocol ("LIP') period occurs during a previously selected flow adjustment operation period, the release of the required minimum continuous flow (or in the case of an LIP event, the LIP flow) will still be considered a flow adjustment period. If a period of higher inflow to Blewett Falls Reservoir occurs during a selected flow adjustment operation period, wherein there is a continuous operation of all commercially available turbines in the Blewett Falls powerhouse, possibly accompanied by additional spillage over the dam crest, this period will count as a flow adjustment period so long as any interruptions in the continuous operation of all commercially available turbines are infrequent and unscheduled. If a period of intermediate inflow to the Blewett Falls Reservoir occurs (flows in the range of 3,000 to 6,000 cfs), Progress Energy will manage releases at the Blewett Falls powerhouse as follows: (1) If unregulated tributary inflow to the Pee Dee River above Blewett Falls (particularly from the Rocky River) changes significantly during a designated flow adjustment operation period, Progress Energy can respond to these changes in flow as needed to manage reservoir operations by increasing or reducing the number of turbines in operation without consideration to the limits described below in (2) through (5). This would still be considered a flow adjustment period. (2) Except as identified in (1) above, the upramp time of each turbine at Blewett Falls will be no less than 30 minutes from off-line to full gate. (3) Except as identified in (1) above, the downramp time of each turbine at Blewett Falls from full gate to off-line will be in accordance with the following guidelines: i. After the first operating unit is taken off-line, the second operating unit to be taken off-line shall not be taken off-line for at least two hours after the first operating unit was taken off-line. ii. After the second operating unit is taken off-line, the third operating unit to be taken off-line shall not be taken off-line for at least four hours after the second operating unit was taken off-line. iii. After the third operating unit is taken off-line, the fourth operating unit to be taken off-line shall not be taken off-line for at least six hours after the third operating unit was taken off-line. (4) On the first day of any flow adjustment operation period, Blewett Falls must commence such related operations no later than 8 a.m. to still be considered as a full day of flow adjustment operation. 6 (5) On the last day of any flow adjustment operation period, Blewett Falls units can begin to be taken off-line no earlier than 4 p.m. By example, the schedule below would be considered a full day of a designated flow adjustment operation period if it were the last day of such period: (i) 4 PM - go from 5 units to 4 units (ii) 6 PM - go from 4 units to 3 units (iii) 10 PM - go from 3 units to 2 units (6) If the five 5-day flow adjustment operation periods are chosen in any given year, each period shall begin on a Monday morning and end on a Friday evening. (7) If the one 14-day and one 10-day period is chosen in any given year, the actual dates shall be such as to minimize the number of weekend days within the 14-day period. For the 10-day period, there will be no more than 2 weekend days. All decisions to be made by the Spawning Flow Management Team as outlined in this section shall require consensus as specifically defined as follows in the Comprehensive Settlement Agreement: A resolution based on consensus shall have either the unanimous support of all Parties, or at least no opposition from any Party. If a Party has no objection to the resolution but does not specifically endorse it, the lack of opposition shall be considered to be support of the resolution. Progress Energy will prepare an annual report of the operations of the Blewett Falls Development during the Flow Adjustment Operation periods consisting of meeting notes, flow records from streamflow gages, and plant operations. The operations of the Tillery Plant during the Flow Adjustment Period will be coordinated by Progress Energy and subject to dispatch by Progress Energy in accordance with its system needs. The first year of implementation of the Flow Adjustment Operations shall be the calendar year following the year of license issuance. After five years of Flow Adjustment Operations, the Spawning Flow Management Team shall evaluate the Flow Adjustment Operations and develop recommended changes for consideration by the resource agencies and Progress Energy. Re- evaluation at 5-year intervals may occur if determined necessary and if agreed to by the Spawning Flow Management Team. 3. Minimum Flow Variance The minimum flow regime will allow a variance for two 5-hour periods each year to reduce the minimum flow release to just leakage flow for testing black-start capability of turbines at the Blewett Falls powerhouse. These black-start tests will be restricted to occur only in October, November, December, or January, when environmental effects of low flow for a 5-hour period are expected to be minimal. Further, these tests shall not be conducted in October if a Stage I or greater Low Inflow Protocol event has been triggered. 7 In an effort to properly manage water during unusually low flow conditions, Progress Energy shall participate in a Low Inflow Protocol (LIP) (see Section I.D). Minimum instream flows may be reduced during these LIP periods in order to conserve water resources during periods of low flow in the watershed, 4. Minimum Flow Compliance and Monitoring Progress Energy will maintain to the standards established by the USGS a continuous flow monitoring gage at the site of the current Rockingham USGS gage and will provide flow data to the public, via the Internet or other appropriate means, to be updated no less than every two (2) hours. For the first ten (10) years after issuance of the New License, Progress Energy will contract with the USGS for operation and maintenance of this gage. Annual reporting of flows will be in accordance with normal USGS practices and procedures. Compliance with minimum flows for the Blewett Falls facility will be measured at the Rockingham gage. Progress Energy will maintain to the standards established by the USGS a continuous flow monitoring gage at the site of the current Rocky River gage near the mouth of the Rocky River. Progress Energy currently pays a portion of the cost of the maintenance of this gage. If for any reason the funding of this gage by others is lost, then Progress Energy will be responsible for the additional funding necessary to maintain the gage. However, the Applicant may elect to discontinue the use of USGS as the provider of this service after the first ten (10) years following the issuance of the new license. Minimum releases required at the Blewett Falls Development shall be presumed to have been met if flows recorded at the streamflow gage at Rockingham are within 5% of the required minimum release, so long as the "true-up" procedure described below is implemented. Progress Energy will prepare an annual report documenting its compliance with minimum releases including any "true-up" periods. To the extent practicable, Progress Energy will "true-up" minimum flows monthly; that is, flows falling below the minimum shall be offset by flows greater than the minimum (during minimum release periods) in the same month for a reasonably equivalent amount of time. If any instances of recorded lower-than-required minimum flows are not properly compensated for in the month they occur, such compensation will occur as soon as practicable in the next month, but no later than the 15th day of that month. Progress Energy's annual report shall indicate all periods where a "true-up" was required and show how and when the actual "true-up" occurred. The annual report shall be filed with the NCDENR - DWQ and DWR, by March 31 of the following year. If any of the resource agencies have significant concerns or comments on the report, a consultation meeting will be convened to discuss these concerns. Such meeting shall be held within 45 days of the issuance of the report. There shall be no "gaming" of the minimum flow variance allowed under this compliance standard; that is, under no circumstance shall Progress Energy intentionally or willfully use the existence of the variance and true-up mechanism to deliberately manipulate minimum flow releases to coincide with demand for electricity. For example, a consistent record of lower-than- required minimum flows during periods of high electrical demand shall be considered "gaming." Certain LIP events require the release of 925 cfs as the "critical flow." The Applicant shall endeavor to maintain this target flow; however, compliance will have been achieved if the flow recorded during this event is between 900 and 950 cfs at the Rockingham gage. 8 C. Tillery Plant 1. Minimum Flow Regime Progress Energy will provide a continuous year-round minimum flow at the Tillery Development of 330 cfs except for a period of eight continuous weeks commencing as early as March 15, but no later than March 22, when a minimum flow of 725 cfs shall be provided to enhance American shad spawning. This release of 725 cfs will start in 2010, or at the first passage of American shad above Blewett Falls Dam, whichever is later. 2. Temperature of Minimum Flow Releases Flows released at the Tillery Development for the purpose of meeting minimum flow requirements will be done in such a way as to avoid skimming high temperature surface water from the uppermost surface of Lake Tillery if high temperature gradients are found to occur in the upper six inches of the lake. 3. Minimum Flow Compliance and Monitoring Within 12 months of the New License becoming Final and Non-Appealable, Progress Energy will install and maintain to the standards established by the USGS a continuous flow monitoring gage below the Tillery Development near the State Highway 731 Bridge and will provide flow data to the public, via the Internet or other appropriate means, to be updated no less than every two (2) hours. For the first ten (10) years after issuance of the New License, Progress Energy will contract with the USGS for operation and maintenance of this gage. Annual reporting of flows will be in accordance with normal USGS practices and procedures. Minimum releases required at the Tillery Development are presumed to have been met if flows recorded at the streamflow gage near the Highway 731 Bridge are within 5% of the required minimum, as long as the "true-up" procedure described below is implemented. Progress Energy will prepare an annual report documenting its compliance with minimum releases including any "true-up" period. To the extent practicable, Progress Energy will "true-up" minimum flows monthly; that is, flows falling below the minimum shall be offset by flows greater than the minimum (during minimum release periods) in the same month and for a reasonably equivalent amount of time. If any instances of recorded lower-than-required minimum flows are not properly compensated for in the month they occur, such compensation will occur as soon as practicable in the next month, but no later than the 15th day of that month. Progress Energy's annual report shall indicate all periods where a "true-up" was required and show how and when the actual "true-up" occurred. 4. Other Stream Protection Measures Progress Energy has agreed to conserve for purposes of stream protection various plots of land it owns along the Pee Dee River in the vicinity of the Project. Conservation is achieved through either donation of lands to the State of North Carolina or through the placement of restrictive covenants on riparian lands and within shoreline buffer zones. These measures are described in detail in Section IV. 9 D. Low Inflow Protocol Progress Energy agrees to comply with the requirements of the Low Inflow Protocol (LIP) dated February 2007, which was developed as part of the relicensing process. The complete text of the LIP is also attached as Appendix B for inclusion in the 401 Water Quality Certificate. E. Implementation Schedule Minimum instream flows will be commenced within 60 days of the receipt of a New License from FERC that is Final and Non-Appealable, assuming that APGI's new license has been issued prior to or concurrent with Progress Energy's license and that APGI has commenced, and continues, the releases specified in Section I.A. II. Reservoir Water Levels A. Blewett Falls Plant When inflows to Blewett Falls Reservoir are less than approximately 7,400 cfs, Progress Energy shall maintain a year-round water level regime at Blewett Falls Lake that allows for fluctuations of up to 6 ft, between elevation 172.1 and 178.1 ft, except for system emergencies and LIP. When flashboards are down, an additional 2 ft of drawdown to elevation 170.1 ft is necessary to safely replace the flashboards. During the bass spawning season, April 15 to May 15, Progress Energy will limit water level changes to 2 ft to enhance bass spawning except when additional reservoir storage is necessary to meet minimum flow release obligations (minimum flow releases will have priority over lake elevations) or if the flashboards fail. In either of the exceptions noted above, Progress Energy will endeavor to return to normal operations as soon as reasonably practical. B. Tillery Plant 1. Water Levels Progress Energy will follow a seasonally-based lake level management schedule at Lake Tillery during the term of the New License. From December 15 through March 1, lake level fluctuations will be limited to 3 ft between 274.3 and 277.3, unless use of reservoir storage is needed to meet demand for electricity. If storage is needed for electrical generation purposes during this period, Progress Energy may use the storage available between elevations 272.3 ft and 277.3 ft, resulting in a maximum fluctuation of 5 ft. When used for these power-related purposes, Progress Energy will normally cycle the reservoir within these elevation limits on a daily or multi-daily basis. Water fluctuations up to 8 ft may occur during system emergencies, and potentially be greater during LIP periods. From April 15 to May 15, Progress Energy will limit lake level changes to 1.5 ft below the water surface elevation of the reservoir as measured on April 15 for bass spawning (higher elevations are acceptable). During all other periods of the year (except flood flow conditions), Progress Energy will maintain lake level fluctuations to generally within 2.5 ft of full pool (elevation 277.3 ft 10 measured at Tillery Dam) on weekdays, and generally 1.5 ft of full pool on weekends and holidays. 2. Maintenance Drawdowns Once in every 5-year period, Progress Energy will schedule a maintenance drawdown of up to 15 ft to occur on Lake Tillery within the September 15 to December 15 timeframe. This drawdown will allow Progress Energy to perform routine periodic maintenance and gate testing that cannot be accomplished when the lake level is higher. 3. Public Information on Water Levels Progress Energy will add a projection of the expected daily water levels for the day on their existing 800-899-4435 public messaging service. For the first five years of the New License, Progress Energy will also provide an annual notice on November 15 alerting the public to the drawdown limits that apply between December 15 and March 1. 4. Emergency or LIP Water Level Variance In the case of an LIP event, Lake Tillery and the other larger reservoirs in the basin will be called upon to use some of their storage to augment downstream flows in a coordinated manner. Management of flows and water levels during LIP events are contained in the LIP attached hereto as Appendix B. C. Compliance Monitoring Annual reports on lake level compliance will be submitted to the North Carolina Division of Water Quality (NCDWQ) and will include hourly readings of lake levels recorded at the both the Tillery and Blewett Falls dams. D. Implementation Schedule The new reservoir level management regime will be initiated within 120 days of the New License becoming Final and Non-Appealable. III. Water Quality A. Blewett Falls Plant 1. Tailwater Water Quality Progress Energy shall meet dissolved oxygen standards by December 2011. The implementation schedule includes completion of field testing of DO enhancement options by December 2008, and completing successful implementation of the best suited DO enhancement technology by December 2011. 2. Compliance Monitoring Progress Energy will provide monitoring of water temperature and dissolved oxygen. Temperature and DO monitoring will occur immediately below the end of the Blewett Falls tailrace with equipment installed by the Applicant in accordance with protocols approved by 11 NCDWQ. Annual compliance reports will be prepared by Progress Energy and submitted to NCDWQ and FERC by April 15th of the following year. B. Tillery Plant 1. Tailwater Water Quality Progress Energy shall meet dissolved oxygen standards by December 2011. The implementation schedule includes completion of field testing of various DO enhancement options by December 2008, and completing successful implementation of the best suited DO enhancement technology by December 2011. 2. Compliance Monitoring Progress Energy will provide continuous monitoring of water temperature and dissolved oxygen. Temperature and. DO monitoring will occur below the Tillery Plant with equipment installed by the Applicant in accordance with protocols approved by NCDWQ. The final location of DO monitoring near the Highway 731 Bridge will be determined based upon further testing of DO enhancement technologies and resulting patterns of DO concentrations in the Tillery tailwater. Annual compliance reports will be prepared by Progress Energy and submitted to NCDWQ and FERC by April 15th of the following year. C. Total Maximum Daily Load Processes If, during the term of the new license, any Total Maximum Daily Load (TMDL) processes are required for the Yadkin-Pee Dee River (or its tributaries) within the Project Boundary of the Yadkin-Pee Dee Project or on the Pee Dee River immediately downstream of either Tillery Reservoir or Blewett Falls Reservoir, the Applicant will participate in these processes. Participation would be expected to include, for example providing any existing water quality sampling or flow release data and participating in relevant stakeholder technical teams. IV. Additional Stream Protection Measures For the purpose of providing additional protection to stream and riparian habitats within the river corridor potentially affected by Project operations, Progress Energy will undertake certain measures as follows: (1) the donation to the State of North Carolina of certain parcels of undeveloped land owned by Progress Energy bordering the Pee Dee River; (2) the placement of restrictive covenants for conservation purposes on certain parcels of undeveloped land owned by Progress Energy adjacent to Project-affected waters; and (3) the leasing of certain lands owned by Progress Energy to the State of North Carolina for the term of the new license. Each of the measures referenced above are more fully described below. 12 A. Lands to Be Donated to the State of North Carolina Within five years of the issuance of the New License for the Project that is Final and Non- Appealable, Progress Energy will donate to the State of North Carolina various tracts of land it owns along the Pee Dee River below Blewett Falls Dam on both the east and west river banks extending from Blewett Falls Dam to below the Highway 74 bridge and including lands adjacent to the highly valued river shoals located below Highway 74. These lands also include the Gabbro Slopes area above Highway 74 and valuable riparian and wetland complexes on the East and West river banks. These lands to be donated, which have a total acreage of approximately 1600 acres, are depicted in the attached Appendix C. Within five years of the issuance of the New License for the Project that is Final and Non- Appealable, Progress Energy will also donate to the State of North Carolina lands it presently owns along the eastern bank of the Pee Dee River extending downstream from the Highway 731 bridge for approximately four (4) contiguous miles. These lands to be donated, which have a total acreage of approximately 300 acres and will provide a protected riparian corridor along the east shore of the Pee Dee River, are depicted in the attached Appendix C. Until these lands are donated to the State of North Carolina, the Parties agree that interim land management by the Applicant will use reasonable efforts to conform to the following forestry management practices where timbering is scheduled: (1) For loblolly pine plantations that are 30 or more years old, thin to approximately 30 trees/acres. (2) For pine/hardwood mixed stands that are 30 or more years old, after consultation with NCWRC, thin to approximately 30 trees/acre. (3) For 15 to 30 year old stands of loblolly pine, thin to approximately 60 trees/acre. (4) Reserve the ability to clear-cut parcels up to 25 acres in size where best management practices would dictate (not including any environmentally significant areas) but only after consultation with NCWRC and DWQ. (5) Leave an undisturbed buffer of not less than 100 feet in width along the Pee Dee River and along both sides of any streams. (6) Predominantly hardwood stands will not be timbered. The Applicant represents that it is responsible for providing reliable electric service to its customers within North and South Carolina. To that end, from time to time the Applicant constructs electrical transmission lines within its service area. The Applicant represents that such lines are located only after consideration of many factors, including potential impacts to homes, businesses, schools, roads, and other infrastructure; cultural and historic resources; sensitive environmental features and natural areas; and other factors. Nothing in this 401 Certification (1) is intended specifically to prohibit the Licensee from planning, designing, and constructing a transmission or distribution line through, over or across lands described above by this Certification or (2) shall obviate any duty to obtain all necessary regulatory, environmental, or other approvals. The parties recognize that the rights, duties, obligations of this 401 Certification and the actions taken pursuant to this certificate (such as the preservation of lands 13 described herein) may be considered in any proceeding regarding a transmission or distribution line. Each party assumes responsibility for its own costs associated with deed transfers described herein. B. Lands Subject to a Restrictive Covenant Progress Energy will place a restrictive covenant for conservation purposes on certain lands it owns known as the "Diggs Tract" along the Pee Dee River below the Highway 74 bridge, which is depicted in the attached Appendix D. Within twelve (12) months of the issuance of a New License for the Project that is Final and Non-Appealable, Progress Energy will execute, deliver and cause to be recorded covenants and restrictions establishing a buffer zone adjacent to the river that would be at least 100-ft-wide along the entire tract. Within the buffer zone, activities to be allowed would be limited to such activities as selective clearing and controlled burning in accordance with a forest management plan approved by NCDENR, limited unimproved foot trails not to exceed 4 ft in width and a single boat access point to the river. Foot trails generally parallel to the river shall be no closer to the river than 50 feet. There shall be no more than three trails perpendicular to the river within the buffer zone. Except to accommodate the above allowable activities, the following shall be prohibited within the buffer zone: filling, draining, flooding, dredging, impounding, clearing, burning, cutting or destroying vegetation, cultivating, excavating, erecting, overnight camping, constructing, releasing wastes, or otherwise doing any work within the buffer zone, introducing exotic species into the buffer zone (except biological controls pre-approved by NC DWQ); and from changing the grade or elevation, impairing the flow or circulation of waters, reducing the reach of waters, and any other discharge or activity requiring a permit under clean water or water pollution control laws and regulations, as amended. The following are expressly excepted from the prohibited activities: (a) cumulatively very small impacts associated with hunting, fishing, and similar recreational or educational activity, consistent with the continuing natural condition of the property; (b) removal or trimming of vegetation hazardous to persons or property; and (c) restoration or mitigation required under law. No permanent structures would be allowed within the 100-ft buffer zone. Within twenty four (24) months of the issuance of the New License that is Final and Non- Appealable, Progress Energy will also place a restrictive covenant for conservation purposes on Project lands it owns in the Grassy islands area located at the upper reaches of Blewett Falls Lake, which are depicted in the attached Appendix D. This area contains large bottomland hardwood forests and an oxbow swamp with a large stand of Black Gum. These are highly valued wetland resources of regional significance. The restrictive covenant would be defined to permit only certain non-consumptive uses of the lands, including fishing, hunting, hiking, bird- watching, and other low-density recreation activities. Prohibited activities will be identical to those described above for the Diggs Tract. Within twenty four (24) months of the issuance of the New License that is Final and Non- Appealable, Progress Energy will place a restrictive covenant for conservation purposes on certain lands it owns near the mouth of the Uwharrie River, which are depicted in the attached Appendix D. The lands to be protected by a restrictive covenant include (1) those extending from Dutchman's Creek downstream to the tip of the peninsula on the south side of the mouth of the Uwharrie River and (2) those at the upper end of the "bay," created by the above peninsula, that are classified as of December 2006 as Environmental/Natural Areas in the Shoreline Management Plan, stopping at the first tract of land classified as Impact Minimization Zone. The restrictive covenant will allow only certain non-consumptive uses of these lands, such as fishing, 14 hunting, hiking, bird-watching, and other low-density recreation activities. Prohibited activities will be identical to those described above related to the restrictive covenants to be applied to the buffer zone of the Diggs Tract. Until these lands are protected by covenant, the Parties agree that interim land management by the Applicant will use reasonable efforts to conform to the following forestry management practices where timbering is scheduled: (1) For Loblolly pine plantations that are 30 or more years old, thin to approximately 30 trees/acres. (2) For pine/hardwood mixed stands that are 30 or more years old, after consultation with NCWRC, thin to approximately 30 trees/acre. (3) For 15 to 30 year old stands of loblolly pine, thin to approximately 60 trees/acre. (4) Reserve the ability to clear-cut parcels up to 25 acres in size where best management practices would dictate (not including any environmentally significant areas) but only after consultation with NCWRC and DWQ. (5) Leave an undisturbed buffer of not less than 100 feet in width along the Pee Dee River and along both sides of any streams. (6) Predominantly hardwood stands will not be timbered. The Applicant represents that it is responsible for providing reliable electric service to its customers within North and South Carolina. To that end, from time to time the Applicant constructs electrical transmission lines within its service area. The Applicant represents that such lines are located only after consideration of many factors, including potential impacts to homes, businesses, schools, roads, and other infrastructure; cultural and historic resources; sensitive environmental features and natural areas; and other factors. Nothing in this 401 Certification (1) is intended specifically to prohibit the Applicant from planning, designing, and constructing a transmission or distribution line through, over or across lands described above by this Certification or (2) shall obviate any duty to obtain all necessary regulatory, environmental, or other approvals. The parties recognize that the rights, duties, obligations of this 401 certificate and the actions taken pursuant to this Certification (such as the preservation of lands described herein) may be considered in any proceeding regarding a transmission or distribution line. Each party assumes responsibility for its own costs associated with the deed transfers and restrictive covenants described herein. C. Lands to be Leased Progress Energy will lease to the State of North Carolina for the term of the new license, and at the present lease rate, lands it currently owns between Morrow Mountain State Park and the Pee Dee River, which lands are depicted in the attached Appendix E. These lands are in the vicinity of and include the existing boat launch area at Morrow Mountain State Park. The lease shall be negotiated and executed within twelve (12) months of the issuance of the New License that is Final and Non-Appealable. 15 V. Other Miscellaneous Protection, Mitigation and Enhancement Measures A. Blewett Falls Plant 1. Shoreline Management The shoreline management practice for Blewett Falls Lake will prohibit private access, except normal foot access, to the lake across Project lands except at the designated public access areas. By this measure, shoreline management shall focus on natural resource protection to preserve the largely undisturbed nature of the Blewett Falls impoundment. Additional written approval from DWQ is required for changes to the shoreline management plan. 2. Blewett Falls Lake Sediment Survey Five years following the issuance of the New License that is Final and Non-Appealable, Progress Energy will conduct a sediment survey in Blewett Falls Lake and a gravel recruitment survey in the Blewett Falls tailwater. The gravel recruitment survey will repeat the study conducted by Progress Energy during the relicensing process. If results indicate that there is still no significant problem related to gravel recruitment, then Progress Energy will conduct another survey after an additional 10 years. B. Tillery Plant 1. Implementation of Shoreline Management Plan Progress Energy will implement and enforce the existing Tillery Shoreline Management Plan (SMP) approved by the FERC by order dated November 24, 2004. Appendix B Low Inflow Protocol for the Yadkin & Yadkin-Pee Dee River Hydroelectric Projects GOAL The fundamental goal of this Low Inflow Protocol (LIP) is to take staged actions in the Yadkin- Pee Dee River Basin needed to delay the point at which available water storage in the Yadkin Hydroelectric Project (Federal Energy Regulatory Commission - FERC No. 2197) and the Yadkin-Pee Dee Hydroelectric Project (FERC No. 2206) (collectively, projects) reservoirs is fully depleted while maintaining downstream flows. This LIP is intended to provide additional time to increase the probability that precipitation will restore streamflow and reservoir water elevations to normal ranges. The amount of additional time that is gained during implementation of this LIP depends on the diagnostic accuracy of the trigger points, the amount of regulatory flexibility available to operate the projects, and the effectiveness of the projects' operators and the water users in working together to implement required actions and achieve significant water use reductions. It is assumed that water users in the Yadkin-Pee Dee River Basin not subject to this LIP must comply with all applicable State and local drought response requirements. More specifically, this LIP establishes procedures for adjusting operations during periods of low inflow to the Yadkin Hydroelectric Project owned and operated by Alcoa Power Generating Inc. (APGI) and the Yadkin-Pee Dee River Hydroelectric Project owned by Carolina Power & Light Company and operated by Progress Energy Carolinas, Inc. (PE) (collectively, Licensees) during 16 the term of the new FERC licenses issued for these projects. The provisions of this LIP should be interpreted in a manner consistent with all other provisions of the new FERC licenses. OVERVIEW This LIP will be implemented during periods when there is not enough water flowing into the projects' reservoirs to meet the projects' Required Minimum Instream Flows while maintaining reservoir water elevations within Normal Operating Ranges. This LIP provides trigger points and operating procedures that the Licensees will follow for the projects. This LIP also specifies water withdrawal reduction measures for other water users in portions of the Yadkin-Pee Dee River Basin. The Licensees will provide flow from storage in the projects' reservoirs to support hydroelectric generation and to provide Required Minimum Instream Flows in accordance with their respective new FERC licenses. During periods of normal inflow, reservoir water elevations will be maintained within their Normal Reservoir Operating Ranges. During times that inflow is not adequate to provide Required Minimum Instream Flows and maintain reservoir water elevations within their Normal Reservoir Operating Ranges, the Licensees will reduce releases for hydroelectric generation. If reservoir storage continues to drop and climatologic or hydrologic conditions worsen until trigger points defined in this LIP are reached, the Licensees will implement additional provisions of this LIP, including meeting with the designated agencies and water users to discuss the need for actions pursuant to this LIP. If conditions worsen, progressive stages of this LIP will allow additional use of the available water storage inventory, while conserving water storage volumes through required reductions in LIP Flows and required reductions in water withdrawals. Implementation of this LIP and movement between the various stages are based on measurements of Stream Gage Three-Month Rolling Average Flow, U. S. Drought Monitor Three-Month Numeric Average, and the High Rock Reservoir water elevation. The calculation of these triggers and specific thresholds associated with each stage are detailed in this LIP. Recognizing that improvements to this LIP may be identified during the new FERC license period, this LIP will be re-evaluated as defined in Key Definitions, Facts and Assumptions No. 18. KEY DEFINITIONS, FACTS, AND ASSUMPTIONS 1. Low Inflow Watch or Low Inflow Condition - A period of time when there is not enough water flowing into the projects' reservoirs to meet the projects' Required Minimum Instream Flows while maintaining reservoir water elevations within Normal Reservoir Operating Ranges. 2. LIP Flows - For the purposes of this LIP, this term refers to the flows defined in Table 6. 3. Required Minimum Instream Flows - For the purposes of this LIP, this term includes the minimum flow requirements included in the new FERC licenses for the projects. 4. Public Information Obligations - The Licensees will develop and provide information on their respective websites to inform the public on reservoir water elevations, project releases, usability of public access areas, reservoir inflows, meteorological forecasts, Historic and Actual Stream Gage Three-Month Rolling Average Flow calculations, U.S. Drought Monitor 17 Three-Month Numeric Average calculations, LIP status, YPD-DMAG meeting summaries, and implementation of maintenance or emergency operation plans. 5. Stream Gage Three-Month Rolling Average Flow - The three-month rolling average of streamflow will be calculated at the following USGS stream gages: • Yadkin River at Yadkin College (02116500) • South Yadkin River near Mocksville (02118000) • Abbotts Creek at Lexington (02121500) • Rocky River near Norwood (02126000) This flow will be calculated on the last day of each month by averaging the monthly average of the current month and the two preceding months. The sum of the three-month rolling average for these four gage stations will be compared to the Historic Stream Gage Three-Month Rolling Average Flow for the corresponding period. 6. Historic Stream Gage Three-Month Rolling Average Flow - The daily flow for each of the four designated USGS stream gages has been used to calculate a monthly average flow for the period of record 1974 through 2003. Because the USGS only began gaging flows for Abbotts Creek in 1988, the historical average for this gage will be based on the period 1988 through 2003. The historic three-month rolling average flow for each month of the year, presented in Table 1, was calculated on the last day of each month of the year by averaging the monthly average flow for each month and the preceding two months. The use of the period of record 1974 through 2003 to calculate the historic three-month rolling average flow will be evaluated every five years during the review of this LIP (see Key Definitions, Facts, and Assumptions No. 18). Table 1. Historic Stream Gaae Three-Month Rolling Average Flow For Evaluation of Flow Trigger on: Average of daily flows during: Historic Three-Month Rolling Average Flow, cfs January 1 Oct-Nov-Dec 4,000 February 1 Nov-Dec-Jan 5,200 March 1 Dec-Jan-Feb 6,250 April 1 Jan-Feb-Mar 7,700 May 1 Feb-Mar-Apr 7,550 June 1 Mar-Apr-Ma 6,850 Jul 1 Apr-May-Jun 5,350 August 1 May-Jun-Jul 4,200 September 1 Jun-Jul-Au 3,600 October 1 Jul-Aug-Sep 3,200 November 1 Aug-Sep-Oct 3,300 December 1 Sep-Oct-Nov 3,550 7. Full Pond Elevation - Also referred to as "Full Pond", this is the elevation of a reservoir (measured in feet, USGS datum [NGVD 1929]) that corresponds to the point at which water would first begin to spill from each reservoir's dam if the respective Licensee took no action. This elevation corresponds to the lowest point along the top of the spillway (including flashboards) for reservoirs without flood gates; and to the lowest point along the top of the 18 flood gates for reservoirs that have flood gates. The Full Pond Elevation for each projects' reservoirs is listed in Table 2. Table 2. Full Pond Elevations Reservoir Full Pond Elevation (feet, USGS datum - NGVD 1929) High Rock 623.9 Tuckertown 564.7 Narrows 509.8 Falls 332.8 Tillery 278.2 Blewett Falls 178.1 8. Normal Reservoir Operating Range - The band of reservoir water elevations within which the Licensees normally attempt to maintain a given reservoir on a given day. Each reservoir has its own specific Normal Reservoir Operating Range, bounded by Full Pond Elevation and Normal Minimum Elevation. If net inflows to the reservoir are within a reasonable tolerance of the average or expected amounts, project equipment is operating properly, and if maintenance or emergency operation plans have not been implemented, reservoir water elevation excursions outside of the Normal Reservoir Operating Range should not occur. The new FERC license for the Yadkin Project includes operating curves that establish the Normal Reservoir Operating Range for each Yadkin Project reservoir. 9. Normal Minimum Elevation (NME) - The elevation of a reservoir (measured in feet, USGS datum [NGVD 1929]) that defines the bottom of the reservoir's Normal Operating Range for a given day of the year. NME for each of the projects' reservoirs is listed in Table 3. Table 3. Normal Minimum Elevations (feet. USGS datum - NGVD 1929) Month High Rock Tucker- town Narrows Falls Tillery Blewett Falls Full Pond 623.9 564.7 509.8 332.8 278.2 178.1 January 1 613.9 561.7 504.8 328.8 273.2 172,1 February 1 613.9 561.7 504.8 328.8 273.2 172.1 March 1 transition 561.7 504.8 328.6 275.7 172.1 April1 619.9 561.7 504.8 328.8 275.7 172.1 May 1 619.9 561.7 504.8 328.6 275.7 1721 June 1 619.9 561.7 504.8 328.8 275.7 172.1 Jul 1 619.9 561.7 504.8 328.8 275.7 172.1 August 1 619.9 561.7 504.8 328.8 275.7 172.1 September 1 619.9 561.7 504.8 328.8 275.7 172.1 October 1 619.9 561.7 504.8 328.8 275.7 172.1 November 1 transition 561.7 504.8 328.6 275.7 172.1 December 1-15 613.9 561.7 504.8 328.8 275.7 172.1 December 16-31 613.9 561.7 504.8 328.8 273.2 172.1 10. Public Water System -For the purposes of this LIP, a Public Water System is any publicly or privately owned water system that supplies potable water to the public having an 19 instantaneous withdrawal capacity of one million gallons per day or more, and withdraws from storage in the projects' reservoirs. 11. Non-Public Water User - For the purposes of this LIP, a Non-Public Water User is any publicly or privately owned water withdrawer that withdraws water for uses other than supplying potable water to the public, having an instantaneous withdrawal capacity of one million gallons per day or more that withdraws from storage in the projects' reservoirs. 12. U.S. Drought Monitor - A synthesis of multiple indices, outlooks, and news accounts (published by the U. S. Department of Agriculture) that represent a consensus of federal and academic scientists concerning the drought status of all parts of the United States. Typically, the U.S. Drought Monitor indicates intensity of drought as DO-Abnormally Dry, D1- Moderate, D2-Severe, D3-Extreme and D4-Exceptional. The current U.S. Drought Monitor and explanatory material can be found at.http://www.drou.qht.unl.edu/dm/monitor.html. 13. U.S. Drought Monitor Three-Month Numeric Average - If the U.S. Drought Monitor has a designation ranging from DO to D4 as of the last day of a month for any part of the Yadkin- Pee Dee River Basin that drains to the Blewett Falls development, the basin will be assigned a numeric value for that month. The numeric value will equal the highest U.S. Drought Monitor designation (e.g. D0=0, DI =1, D2=2, D3=3 and D4=4) for any part of the Yadkin-Pee Dee River Basin draining to Blewett Falls development as of the last day of the month. A normal condition in the basin, defined as the absence of a drought designation, will be assigned a numeric value of negative one (-1). A rolling average of the numeric values of the current month and previous two months will be calculated by APGI at the end of the month and designated as the U.S. Drought Monitor Three-Month Numeric Average for purposes of this LIP. 14. Critical Reservoir Water Elevation - The reservoir water elevation (measured in feet, USGS datum [NGVD 1 929]) below which a Public Water System intake, Non-Public Water User's intake, or hydropower plant located on the reservoir cannot operate under normal conditions. Critical Reservoir Water Elevations are defined in Table 4. Tahlp A- Critical Reservoir Water Elevation Critical Reservoir Reservoir Water Elevation Type measured at the dam (feet USGS Datum - NGVD1929) High Rock 599.9 (24 ft below full pool) H dropower Production Tuckertown 560.7 4 ft below full pool) Public Water Supply Narrows 486.8 23 ft below full pool) Public Water Supply Falls 322.8 (10 ft below full pool) Hydropower Production Tillery 268.2 (10 ft below full pool) Public Water Supply Blewett Falls 168 (10.1 ft below full pool) Public Water Supply/ Hydropower Production 15. Critical Flow - The flows from the projects that are necessary to prevent long-term or irreversible damage to aquatic communities consistent with the resource management goals and objectives for the affected stream reaches and necessary to provide some basic level of water quality maintenance in affected river reaches, For the purposes of this LIP, the Critical Flows are defined as follows: 20 Falls Development - the Critical Flow from the Falls Development is equal to 770 cfs measured on a daily average basis. Tillery Development - the Critical Flow from the Tillery Development is the same as required minimum instream flow as defined in the new FERC license for Yadkin Pee- Dee River Hydroelectric Project. Blewett Falls Development - the Critical Flow from the Blewett Falls Development is 925 cfs measured on a continuous basis. 16. Organizational Abbreviations - Organizational abbreviations include Alcoa Power Generating Inc. (APGI), Progress Energy (PE), NC Department of Environment and Natural Resources (NCDENR), North Carolina Division of Water Resources (NCDWR), North Carolina Division of Water Quality (NCDWQ), North Carolina Wildlife Resources Commission (NCWRC), South Carolina Department of Natural Resources (SCDNR), South Carolina Department of Health and Environmental Control (SCDHEC), the United States Fish and Wildlife Service (USFWS), High Rock Lake Association (HRLA), Badin Lake Association (BLA), and South Carolina Pee Dee River Coalition (SCPDRC). 17. Yadkin-Pee Dee River Basin Drought Management Advisory Group (YPD-DMAG) -The YPD-DMAG is established to facilitate implementation and review of this LIP. Members of the YPD-DMAG agree to comply with this LIP. Membership on the YPD-DMAG is open to one representative from each of the following organizations: • APGI • PE • NCDWR • NCDWQ • NCWRC • SCDNR • SCDHEC • USFWS • Duke Power • HRLA • BLA • Lake Tillery homeowners representation • SCPDRC • All owners of a Public Water System intake or a Non-Public Water User's intake that withdraw from storage in one of the projects' reservoirs. The Licensees will share the responsibility to notify NCDWR of a Low Inflow Condition. NCDWR and SCDNR will share responsibility to coordinate with the YPD-DMAG including notifying, setting agendas, leading discussions, and providing call/meeting summaries. Regardless of the Low Inflow Condition, coordination will include a meeting convened annually by NCDWR during April to discuss issues relevant to this LIP. Membership in the YPD-DMAG may be expanded based on a consensus of the members or at the direction of FERC. The NCDWR will maintain an active roster of the YPD-DMAG, will prepare meeting summaries of all YPD-DMAG meetings. 18. Revisinq this LIP - During the new FERC license period, the YPD-DMAG will be convened by NCDWR and SCDNR at least once every five (5) years to review and, if necessary, update this LIP. Decisions on modifications to the Licensees' responsibilities under this LIP, 21 if any, will be determined by consensus of the Licensees and the States of North Carolina and South Carolina (specifically NCDWR, NCDWQ, SCDNR, SCDHEC) after consultation with other members of the YPD-DMAG. Proposed modification to the Licensees' responsibilities will be submitted to DWQ for review and approval as necessary. Modifications to the responsibilities of other members (not the FERC licensees) of the YPD- DMAG under this LIP, if any, will be determined by consensus of those members after consultation with the Licensees. Approved modifications will be incorporated through revision of this LIP. The YPD-DMAG may appoint an ad hoc committee to consider issues relevant to this LIP. An issue such as the substitution of a regional drought monitor for the U.S. Drought Monitor, if developed in the future, or proportional drawdown of storage reservoirs during LIP stages are examples of items that may be considered. 19. Consensus - The unanimous support of all Parties, or at least no opposition from any Party. 20. Water Withdrawal Data Collection and Reporting - The owners of all water intakes impacted by this LIP are to comply with water use reporting requirements of the appropriate State Agencies. The YPD-DMAG can request and should receive relevant water use information from the appropriate state agency or directly from the owners of individual intakes. 21. Drought Response Plan Updates - All Public Water Supply System owners and Non- Public Water Users subject to this LIP will review and update their drought response plans, or develop a plan if they do not have one, to ensure compliance and coordination with this LIP, including the authority to enforce the provisions outlined herein. Nothing in this LIP is intended to prevent Public Water System owners or Non-Public Water Users from taking more restrictive actions or from complying with any applicable law or regulation. 22. Relationship Between this LIP and Maintenance and Emergency Plans - Maintenance and emergency plans outline the general approach the Licensees will take under certain maintenance, emergency, equipment failure and other situations to continue practical and safe operation of the projects; to maintain operations consistent with the new FERC license conditions to the maximum extent possible; and to communicate with resource agencies and the affected parties. Under these plans, temporary modifications to Required Minimum Instream Flow releases, and the Normal Reservoir Operating Ranges are allowed. Lowering projects' reservoir water elevations caused by situations addressed under maintenance and emergency plans will not invoke implementation of this LIP. Also, if this LIP has already been implemented at the time that a situation covered by these plans is initiated, the Licensee may suspend implementation of this LIP until the maintenance or emergency situation has been eliminated. Notification will be provided by the Licensees to the State Agencies as soon as practicable. PROCEDURE A Low Inflow Watch or Low Inflow Condition, as specifically defined below, will be triggered by the combination of conditions defined in Table 5. This LIP will be implemented at Stage 0 and, if the combination of conditions becomes more severe, the stage will increase in one stage increments. The Licensees and other water users will follow the procedure set forth in this section regarding communications and adjustments to flows and other water demands. 22 Table 5. Summary of LIP Triggers Stream Gage Three- High Rock US Drought Month Rolling Stage Reservoir Elevation Monitor Three- Month Numeric Average as a percent of the Average Historical Average < NME minus 0.5 f and an or an OR 0 < NME and 0 ' or <48% her eit - <NME minus I ft e t and er '-1 or <41 % 2 <NME minus 2 ft eitand her '--2 or <35% 3 <NME minus 3 ft etand her '-3 or <30% <1/2 of ( NME minus and 4 Critical Reservoir et her >4 or <30 % Water Elevation The LIP Flows set forth in Table 6 will be initiated on a monthly basis and are designed to equitably allocate the impacts of reduced water availability in accordance with the goal of this LIP. Initiation of this LIP will be based on analysis of the trigger conditions on the first day of each month. The High Rock Reservoir water elevation as of midnight between the last day of the previous month and the first day of the current month will be used in combination with the U.S. Drought Monitor Three-Month Numeric Average and the Stream Gage Three-Month Rolling Average Flow to determine the need to declare a Low Inflow Watch or change the stage of Low Inflow Conditions. 23 Table 6. LIP Flows('), cfs High Rock Falls (2) Blewett Falls (2) Stage (daily average (daily average flow target) (continuous flow target (3)) maximum flow target) Feb 1- May Jun 1- Feb 1- May Jun 1- Feb 1 - May Jun 1- Ma 15 16-31 Jan 31 May 15 16-31 Jan 31 May 1 16-31 Jan 31 0 2000 1500 1000 2000 1500 1000 2400 1800 1200 1 1450 1170 900 1450 1170 900 1750 1400 1080 2 1080 950 830 1080 950 830 1300 1150 1000 3 E 770 770 770 770 770 770 925 925 925 4 Additional measures may be determined by consensus of the Licensees and State Agencies. NCDWQ approval of an additional measures will be required. Consistent with the goal of this LIP to conserve water while maintaining downstream flows, projects will be operated to achieve the target flows to the extent practicable as a first priority and to supplement inflows equitably from the storage reservoirs as a second priority. 2 The LIP flow values shown in the table above reflect flow targets. These values cannot be met exactly as shown and will likely vary slightly on a real time basis from the values shown here. It is expected that the variances from the target flows will be minimal. In Stages 0-2 the releases from Blewett Falls will be within 5% of the target as measured at the USGS Rockingham gage. In stages 3-4 the releases from Blewett Falls will be between 900-950 cfs as measured at the USGS Rockingham gage. 3 Local inflows to Blewett Falls Reservoir may be large even during extended low inflow conditions. If at any time during the implementation of the LIP local inflows to Blewett Falls Reservoir are large enough to fill Blewett Falls Reservoir to full pond, the Downstream Licensee may temporarily increase Blewett Falls generation to avoid spill. Stage 0 - Low Inflow Watch: The Licensees will monitor High Rock Reservoir water elevations, the U.S. Drought Monitor and the designated stream gages and will declare a Stage 0 Low Inflow Watch for the month if the following conditions are present on the first day of the month • If the High Rock Reservoir water elevation is below the NME minus 0.5 ft under any inflow or drought condition. OR • The High Rock Reservoir water elevation is below its NME. AND EITHER • The U.S. Drought Monitor Three-Month Numeric Average for the Yadkin-Pee Dee River Basin draining to Blewett Falls Development is greater than or equal to zero. OR 24 • The Stream Gage Three-Month Rolling Average Flow for the monitored stream gages is less than 48% of the Historic Stream Gage Three-Month Rolling Average Flow. When a Stage 0 Low Inflow Watch is declared: 1. The Licensees will notify via email the NCDWR of a Stage 0 Low Inflow Watch as soon as practicable but no later than three business days after the declaration. 2. The NCDWR will activate the YPD-DMAG and initiate monthly meetings or conference calls to be held on the Monday before the second Tuesday. Monthly discussions will: a. Review provisions of this LIP. b. Clarify communication channels between the YPD-DMAG members. c. Review hydrological status of the basin. d. Review the roles of each YPD-DMAG member and discuss their plans for responding if an elevated Low Inflow Condition is declared. e. Review information reporting by YPD-DMAG members, including a storage history and forecast from the Licensees, a water use history and forecast from each water user on the YPD-DMAG, and state-wide drought response status (including, but not limited to, impact to water quality, fisheries, wildlife, etc.) from the member agencies. f. Public communications. ,Stage 1 - Low Inflow Condition: The Licensees will monitor High Rock Reservoir water elevations, the U.S. Drought Monitor and the designated stream gages and will declare a Stage 1 Low Inflow Condition for the month if the following conditions are present on the first of the month: • The prior month LIP condition was Stage 0; AND • The High Rock Reservoir water elevation is more than 1 ft below the NME; AND EITHER • The U.S. Drought Monitor Three-Month Numeric Average for the Yadkin-Pee Dee River Basin draining to Blewett Falls Development is greater than or equal to 1. OR • The Stream Gage Three-Month Rolling Average Flow for the monitored stream gages is less than 41 % of the Historic Stream Gage Three-Month Rolling Average Flow. When a Stage 1 Low Inflow Condition is declared: 1. The Licensees will: 25 a. Notify NCDWR of declaration of a Stage 1 Low Inflow Condition via email as soon as practicable but no later than two business days after the declaration. b. Implement LIP Flows as detailed in Table 6 for each project by the seventh day of the month in which a Stage 1 Low Inflow Condition is declared. To meet the LIP Flows for Stage 1: APGI will supplement Project inflows by drawing first from Narrows Reservoir until the Narrows Reservoir drawdown below its NME matches the High Rock Reservoir drawdown below its NME at the time that the Stage 1 Low Inflow Condition is declared. APGI will supplement Project inflows by drawing from High Rock and Narrows reservoirs approximately equally on a foot-per-foot basis below the Normal Minimum Elevation (NME). PE will supplement Project inflows by drawing from either Tillery or Blewett Falls as required c. Update their respective websites as noted in Key Definitions, Facts and Assumptions No. 4. d. Provide Public Water System intake owners and Non-Public Water Users with weekly updates on reservoir water elevations and inflow of water into the projects' reservoirs. 2. If they have not already done so, NCDWR will coordinate with SCDNR to conduct monthly meetings or conference calls to be held on the Monday before the second Tuesday. Monthly discussions will: a. Review provisions of this LIP. b. Clarify communication channels between the YPD-DMAG members. c. Review hydrological status of the basin. d. Review the roles of each YPD-DMAG member and discuss their plans for responding if an elevated Low Inflow Condition is declared. e. Review information reporting by YPD-DMAG members, including a storage history and forecast from the Licensees, a water use history and forecast from each water user on the YPD-DMAG, and state-wide drought response status (including, but not limited to, impact to water quality, fisheries, wildlife, etc.) from the member agencies. f. Public communications. 3. Owners of Public Water System intakes will complete the following activities within 14 days after a Stage 1 Low Inflow Condition is declared: a. Notify their water customers of the low inflow condition through public outreach and communication efforts. b. Request that their water customers implement voluntary water use restrictions, in accordance with their drought response plans. At this stage, the goal is to reduce water withdrawals by approximately 5% from the amount that would otherwise be expected. These restrictions may include:. • Reduction of lawn and landscape irrigation to no more than two days per week (i.e. residential, multi-family, parks, streetscapes, schools, etc). 26 • Reduction of residential vehicle washing. c. Provide a status update to the YPD-DMAG on actual water withdrawal trends and discuss plans for moving to mandatory restrictions, if they are required. 4. Non-Public Water Users on the YPD-DMAG will complete the following activities within 14 days after a Stage 1 Low Inflow Condition is declared: a. Notify their employees and/or customers of the low inflow condition, b. Request that their employees and customers conserve water through reduction of water use, electric power consumption, and other means, and c. Institute in-house conservation consistent with their drought management plan and minimize consumptive uses to the extent feasible. Stage 2- Low Inflow Condition: The Licensees will monitor High Rock Reservoir water elevations, the U.S. Drought Monitor and the designated stream gages and will declare a Stage 2 Low Inflow Condition for the month if the following conditions are present on the first of the month: • The prior month LIP condition was Stage 1; AND • The High Rock Reservoir water elevation is more than 2 ft below the NME. AND EITHER • The U.S. Drought Monitor Three-Month Numeric Average for the Yadkin-Pee Dee River Basin draining to Blewett Falls Development is greater than or equal to 2. OR • The Stream Gage Three-Month Rolling Average Flow for the monitored stream gages is less than 35% of the Historic Stream Gage Three-Month Rolling Average Flow. When a Stage 2 Low Inflow Condition is declared: 1. The Licensees will: a. Notify NCDWR of a declaration of Stage 2 Low Inflow Condition via email as soon as practicable but no later than two business days after the declaration. b. Implement LIP Flows as detailed in Table 6 for each project by the seventh day of the month in which a Stage 2 Low Inflow Condition is declared. To meet the LIP Flows for Stage: 27 • APGI will supplement Project inflows by drawing from High Rock and Narrows reservoirs approximately equally on a foot-per-foot basis. • PE will supplement Project inflows by drawing from either Tillery or Blewett Falls as required. c. Update their respective websites as noted in Key Definitions, Facts and Assumptions No. 4. d. Provide Public Water System intake owners and Non-Public Water Users with updates twice per week on reservoir water elevations and inflow of water into the system. e. Continue participation in monthly or more frequent meeting or conference calls of the YPD-DMAG 2. NCDWR will coordinate with SCDNR to conduct monthly YPD-DMAG meetings or conference calls to be held on the Monday before the second Tuesday. Monthly discussions will: a. Review provisions of this LIP. b. Clarify communication channels between the YPD-DMAG members. c. Review hydrological status of the basin. d. Review the roles of each YPD-DMAG member and discuss their plans for responding if an elevated Low Inflow Condition is declared. e. Review information reporting by YPD-DMAG members, including a storage history and forecast from the Licensees, a water use history and forecast from each water user on the YPD-DMAG, and state-wide drought response status (including, but not limited to, impact to water quality, fisheries, wildlife, etc.) from the member agencies. f. Public communications. 3. Owners of Public Water System intakes will complete the following activities within 14 days after the Stage 2 Low Inflow Condition is declared: a. Notify their water customers of the continued low inflow condition and movement to more stringent mandatory water use restrictions through public outreach and communication efforts. b. Require that their water customers implement mandatory water use restrictions, in accordance with their drought response plans. At this stage, the goal is to reduce water withdrawals by approximately 10% from the amount that would otherwise be expected. These restrictions may include: • Limiting lawn and landscape irrigation to no more than one day per week (i.e. residential, multi-family, parks, streetscapes, schools, etc). • Eliminating residential vehicle washing. • Limiting public building, sidewalk, and street washing activities except as required for safety and/or to maintain regulatory compliance. • Limiting construction uses of water such as dust control. 28 • Limiting flushing and hydrant testing programs, except to maintain water quality or other special circumstances. • Eliminating the filling of new swimming pools. • Enforce mandatory water use restrictions through the assessment of penalties. • Encourage industrial/manufacturing process changes that reduce water consumption. • Provide a status update to the YPD-DMAG on actual water withdrawal trends. 4. Non-Public Water Users on the YPD-DMAG will complete the following activities within 14 days after the Stage 2 Low Inflow Condition is declared: a. Notify their employees and/or customers of the low inflow condition through public outreach and communication efforts. b. Request that their employees and customers conserve water through reduction of water use, electric power consumption, and other means. c. Institute in-house conservation consistent with their required drought management plans and minimize consumptive uses to the extent feasible. Stage 3 - Low Inflow Condition: The Licensees will monitor High Rock Reservoir water elevations, the U.S. Drought Monitor and the designated stream gages and will declare a Stage 3 Low Inflow Condition for the month if the following conditions are present on the first of the month: • The prior month LIP condition was Stage 2; AND • The High Rock Reservoir water elevation is more than 3 ft below the NME. AND EITHER • The U.S. Drought Monitor Three-Month Numeric Average for the Yadkin-Pee Dee River Basin draining to Blewett Falls Development is greater than or equal to 3. OR • The Stream Gage Three-Month Rolling Average Flow for the monitored stream gages is less than 30% of the Historic Stream Gage Three-Month Rolling Average Flow. When a Stage 3 Low Inflow Condition is declared: 1. The Licensees will: 29 a. Notify NCDWR of a declaration of Stage 3 Low Inflow condition via email as soon as practicable but no later than 48 hours after the declaration. b. Implement LIP Flows to designated Critical Flows as detailed in Table 6 for each project by the seventh day of the month in which a Stage 3 Low Inflow Condition is declared, To meet the Critical Flows: • APGI will supplement Project inflows by drawing from High Rock and Narrows reservoirs approximately equally on a foot-per-foot basis. • PE will supplement Project inflows by drawing from either Tillery or Blewett Falls as required. c. Update their respective websites as noted in Key Definitions, Facts, and Assumptions No. 4. d. Provide Public Water System intake owners and Non-Public Water Users with bi-weekly (twice each week) updates on reservoir water elevations and inflow of water into the system. e. Continue participation in monthly or more frequent meeting or conference calls of the YPD-DMAG. 2. NCDWR will coordinate with SCDNR to conduct monthly YPD-DMAG meetings or conference calls to be held on the Monday before the second Tuesday. Monthly discussions will: a. Review provisions of this LIP. b. Clarify communication channels between the YPD-DMAG members. c. Review hydrological status of the basin. d. Review the roles of each YPD-DMAG member and discuss their plans for responding if an elevated Low Inflow Condition is declared. e. Review information reporting by YPD-DMAG members, including a storage history and forecast from the Licensees, a water use history and forecast from each water user on the YPD-DMAG, and state-wide drought response status (including, but not limited to, impact to water quality, fisheries, wildlife, etc.) from the member agencies. f. Public communications. 3. Owners of Public Water System intakes will complete the following activities within 14 days after the Stage 3 Low Inflow Condition is declared: a. Notify their water customers of the continued low inflow condition and movement to emergency water use restrictions through public outreach and communication efforts. At this stage, the goal is to reduce water usage by approximately 20% from the amount that would otherwise be expected. b. Restrict all outdoor water use. c. Implement emergency water use restrictions in accordance with their drought response plans, including enforcement of these restrictions and assessment of penalties. d. Prioritize and meet with their commercial and industrial large water customers and meet to discuss strategies for water reduction measures including development of an activity schedule and contingency plans. e. Prepare to implement emergency plans to respond to water outages. 30 4. Non-Public Water Users on the YPD-DMAG will complete the following activities within 14 days after a Stage 3 Low Inflow Condition is declared: a. Continue informing their customers of the low inflow condition through public outreach and communication efforts. b. Request that their customers conserve water through reduction of water use, electric power consumption, and other means. Stage 4- Low Inflow Condition: The Licensees will monitor reservoir elevations, the U.S. Drought Monitor and the designated stream gages and will declare a Stage 4 Low Inflow Condition for the month if the following conditions are present on the first of the month: • The prior month LIP condition was Stage 3; AND • The High Rock Reservoir water elevation is less than 606.9 ft USGS (November 1 through March 1) or less than 609.9 ft USGS (April 1 through October 1).' AND EITHER • The U.S. Drought Monitor Three-Month Numeric Average for the Yadkin-Pee Dee River Basin draining to Blewett Falls Development is greater than or equal to 4. OR • The Stream Gage Three-Month Rolling Average Flow for the monitored stream gages is less than 30% of the Historic Stream Gage Three-Month Rolling Average Flow. When a Stage 4 Low Inflow Condition is declared: 1. The Licensees will notify NCDWR via email as soon as practicable but no later than 48 hours after the declaration. 2. NCDWR will request a meeting of the YAD-DMAG within 5 days after the declaration of the Stage 4 Low Inflow Condition for discussion to determine if there are any additional measures that can be implemented to: a. Reduce water withdrawals, reduce water releases from the projects or use additional reservoir storage without creating more severe regional problems. Less than one half the distance between the NME and the Critical Reservoir Water Elevation. 31 b. Work together to develop plans and implement any additional measures identified above. c. Communicate conditions to the public. Additional measures may be determined by consensus of the Licensees and State Agencies with NCDWQ approval as necessary. Recovery from LIP Stages Recovery from this LIP will be triggered by any of the three following conditions: • Condition 1: All three triggers associated with a lower numbered LIP Stage are met. OR • Condition 2: High Rock Reservoir water elevations return to at or above the NME PLUS 2.5 ft. OR • Condition 3: High Rock Reservoir water elevations return to at or above the NME for 2 consecutive weeks. When any of these three conditions occurs: 1. The Licensees will take the following action: a. Condition 1: The LIP recovery will be a general reversal of the staged approach described above. b. Condition 2: The LIP will be discontinued. c. Condition 3: The LIP will be discontinued. 2. The Licensees will notify the NCDWR via email within 3 business days following attainment of any of the conditions necessary to return to a lower stage of this LIP. Changes to less restrictive Stages will be made: a. Condition 1: on the first of each month if a slow recovery is indicated; or b. Condition 2: immediately if High Rock Reservoir elevations are at or above the NME PLUS 2.5 ft. c. Condition 3: immediately if High Rock Reservoir elevations are at or above the NME for 2 consecutive weeks. 3. The Licensees will update their respective websites as noted in Key Definitions, Facts and Assumptions No. 4. 32 Revised Progress Energy Certification 2003-0147, ver 2. Certification 3730 mod1