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003411 A price of $11.38/kw/month is charged to the buying utility as capacity is used. The capacity charge in this contract Cand in most other contracts) is based on the maximum capacity drawn during a stated interval (usually 30 minutes) during a month. For example, if Colorado-Ute draws upon PSCo for 50,000 kilowatts for any 30-minute interval in January, then the charge for the month is 50,000 x $11.34, or $567,000. Although each firm has the right to draw on the other firm as necessary, Colorado-Ute draws more on the PSCo system during the winter than PSCo draws upon CUEA in the summer. Thus, Colorado-Ute enda up being the net purchaser. 2. Public Service Company and Tri-State. PSCo purchases short-term economy energy from the Laramie River units located north of Cheyenne that are owned by Tri-State. which is a generation and transmission cooperative like Colorado-Ute. The Laramie River stations were built in anticipation of load growth that has not materialized and are generally recognized as currently constituting excess capacity; they were also built at a site that has very cheap coal. Tri-State Is selling energy from those units at a price that covers operating costs plus a small contribution to fixed cost. PSCo cannot count on Tri-State units as a permanent source of power. nor for "firm" power: both firms peak in the summer, Tri-State much more severely than PSCo. So. the contracts are short-term, and short-term energy of this type is inexpensive. It pays PSCo to turn down its Pawnee unit, which produces energy at about 1.7 cents per kwh, and buy from Laramie River for 1.4 cents per kwh. 3. City of Colorado Springs and Public Service Company. The City of Colorado Springs buys some "economy" energy, primarily from Public Service Company. The price varies with the seller's marginal operating costs and the buyer's operating costs at the time of purchase, but economy purchases by Colorado Springs average about 1.5 cents per kwh. 7