20080915 Ver 2_2010-05-05 Settlement Agreement - clocked-in copy_20150507

MAY 0 5 2010
STATE OF SOUTH CAROLINA
BEFORE THE ADMINISTRATIVE LAW COUNC ADM N. LAW COURT
Duke Energy Carolinas, LLC, I I Docket No. 09- ALJ -07- 0377 -CC
Petitioner,
0
South Carolina Department of Health and
Environmental Control,
Respondent,
South Carolina Attorney General,
American Rivers, and the South Carolina
Coastal Conservation League,
Respondent - Intervenors
SETTLEMENT AGREEMENT BETWEEN PETITIONER,
DUKE ENERGY CAROLINAS, LLC, AND INTERVENOR,
SOUTH CAROLINA ATTORNEY GENERAL
Petitioner, Duke Energy Carolinas, LLC ( "Duke "), and Intervenor, South Carolina
Attorney General Henry D. McMaster ( "Attorney General'), having entered into negotiations
agree to settle this matter on the terms and conditions contained herein.
PREAMBLE
The South Carolina Attorney General has been involved in the relicensing of the
Duke hydroelectric power plants, which are the subject of this 401 Water Quality
Certification case. As a result of input and efforts of the Attorney General, Duke agrees to
provide improved water quality and water flow through the dam system as described below
in settlement of all issues raised by the Attorney General in this 401 Certification proceeding.

Duke recognizes revisions to current dam operations contained in this Agreement are
accomplished by the work of the Attorney General and as the result of this agreement, Duke
will redirect water resources from power production during peak periods to enhance the
quantity and quality of the Catawba River Basin. Moreover, the projected inter -basin
transfer flows from a water study conducted by Duke in 2006 are important data that
should be considered in the assessment of inter -basin transfers in the Catawba River
Basin when making the future management decisions.
AGREEMENT
The Attorney General agrees to send a letter to Judge Anderson prior to May 6,
2010, withdrawing from this 401 Water Quality Certification case, stating the Attorney
General no longer contests the Motion for Summary Judgment on procedural grounds
entered in this case by Duke. The Attorney General and his staff will not attend the
hearing and will advise DHEC that the Attorney General no longer has an interest in any
appeal in the 401 Water Quality Certification.
As a result of this Settlement with the Attorney General, Duke agrees to undertake
the following water quality (dissolved oxygen) and water quantity (flow) enhancements
at its Lake Wylie Hydroelectric Development until such time that the permanent flow
release and water quality provisions of the New License are implemented:
1. Minimum Flow Improvement - To approximate the new flow release
requirements under the Comprehensive Relicensing Agreement (CRA),
without the delays allowed in the proposed water quality certification
decision of May 15, 2009 for the construction and other requirements that
allow for "continuous flow" from the Wylie Dam, Duke will rapid -pulse
an existing unit thereby running it 1 hr on, 2 hrs off, during periods when
at least 1 unit is not running continuously (effectively giving a "continuous
flow" through Wylie Dam where now Duke is not required to provide
continuous flow) and Duke is not operating under the CRA's Low Inflow
Protocol or Maintenance and Emergency Protocol; and

2. Dissolved Oxygen (DO) Improvement - From May 15 through October
31 (i.e., the low DO season prescribed in S.C. Regs. 61- 68.0 -D), Duke will
operate one or more existing units that have dissolved oxygen
enhancement capability on a first on, last off hierarchy whenever the
station is being operated for flow release, reservoir level control or
generation, which will improve the DO levels in the flow discharging from
the system.
This two part settlement gives the State of South Carolina a commitment for real
water quantity and water quality improvements at the Wylie Hydroelectric Development
substantially earlier than would have occurred otherwise.
Any terms or conditions set forth in any 401 Certification in this matter will not
be asserted by Duke as an equitable apportionment of the Catawba River in South
Carolina v. North Carolina, No. 138 Original, nor will be deemed to estop the State of
South Carolina in such proceeding.
Respectfully submitted,
XA..M- JA La /�./
Duke Energy Corporation
526 South Church Street
EC03T /Post Office Box 1006
Charlotte, NC 28201 -1006
South CarolipdAttorney General
Rembert C. Dennis Office Building
Post Office Box 11549
Columbia, SC 29211
Columbia, South Carolina
May 5, 2010