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Approach

Achieving valuable results requires the advice of professionals who are knowledgeable and who understand the complex energy, financial and commercial issues of today's global economy. Clark Hill's multi-disciplinary team approach is designed to develop sophisticated solutions and to deliver services in the most cost-effective manner which meet the needs of its clients. Clark Hill prides itself in being responsive and in keeping the client fully informed as to the progress of each project. The practical experience of the members of the Energy Team allows them to easily interact with clients' technical staff and consultants so that the team concept can be brought to an entire project.

Services

Some of Clark Hill's more significant efforts to reduce its clients' utility bills include bringing gas transportation and retail choice or open access to Michigan, bypassing local gas and electric utilities, negotiating special rate contracts, development and negotiation of interruptible tariffs which permit customers to back up their utility-supplied interruptible electric service, and negotiation of rate case settlements. Clark Hill's efforts in pursuing these strategies have saved its clients literally hundreds of millions of dollars.

Natural Gas
One of the alternatives to local gas utility service is bypass. Clark Hill energy attorneys spearheaded this concept in Michigan and Clark Hill's legal gas bypass strategy was upheld by the United States Supreme Court. The Energy Team can develop feasibility studies, arrange for FERC permits, secure easements for pipelines, negotiate interconnection agreements, procure transportation and storage agreements, negotiate construction contracts and, in general, devise a successful plan for bypass of the local gas utility. The completion of a credible feasibility study allows the client to negotiate with the local distribution company from a position of strength in order to secure lower gas transportation rates, which could make actual installation of the bypass unnecessary. The Clark Hill energy attorneys has developed feasibility studies and bypass strategies on numerous occasions which have either been implemented or have resulted in the utilities agreeing to offer reduced rates to the clients' satisfaction.

Clark Hill has assisted clients in procuring natural gas supplies, not only in Michigan, but for their national accounts. This has included preparing Requests for Proposals, evaluation of the various bids and preparation of gas purchase contracts.

Finally, our energy attorneys participated in major litigation when gas suppliers have defaulted on their contracts. This litigation has been in both federal and state courts.

Electricity
Clark Hill has represented utility customers in all phases of developing the open access programs required under Michigan law. This has included the development of Open Access Transmission Tariffs before the Federal Energy Regulatory Commission, the local distribution tariffs, securitization bond repayment charges, stranded cost estimates. It is the total of these charges, together with negotiated generation charges from alternative electric suppliers, that will determine whether a customer should participate in open access. The Energy Team has also negotiated energy supply contracts for clients who have participated in open access programs that have been in existence for the last several years.

There are several bypass alternatives such as the creation of a municipal utility to replace, or compete with the existing monopoly electricity provider and participating in the open access programs mandated by Michigan law. The Clark Hill Energy Team has expertise in utility franchise laws and the organization of municipal utilities, and they know how to obtain wholesale power, sources of municipal financing as well as understand the procedures that must be followed in order to secure voter approval of a new municipal utility. Municipal feasibility studies developed by Clark Hill have been, and are being, used to secure lower retail electric rates.

Industrial customers with good thermal loads also have the alternative of totally or partially bypassing the local electric utility through the installation of cogeneration equipment which produces both useful thermal energy and electricity from one fuel source. The Energy Team has assisted in the preparation of feasibility studies and dealt with air permitting issues and contracts with third party owner-operators. The Energy Team has also negotiated standby rates for utility service when cogeneration equipment is not available for operation or is turned off in order to perform maintenance.

Increasingly, electric utilities are willing to negotiate special contracts with large industrial customers containing rate discounts in exchange for the customer agreeing to remain with that utility company for a set period of time. The Energy Team has successfully negotiated special contracts that, when fully implemented, will save clients in excess of $60 million per year over what they were paying for electric service prior to the effective date of the contracts.

Experience

Clark Hill's Energy Team collectively has over 100 years of experience in all areas of energy law, utility regulation and deregulation, project development and in bringing new energy source alternatives to companies who want to break away from the sole supplier local utility monopoly, or who want to create sufficient leverage to enable them to negotiate lower utility rates. Clark Hill's ability to provide its clients with alternatives to traditional utility service is based on the extensive experience of its Energy Team in representing industrial customers in utility regulatory hearings and in assisting its clients to pursue alternatives to standard utility rates.

Members of Clark Hill's Energy Team have represented industrial and commercial energy users before state and federal regulatory bodies for over four decades. During that time Clark Hill has built an admirable record in dealing with a wide variety of ratemaking issues, including nuclear plant and nuclear waste write-offs and phase-ins, utility divestitures, curtailments and gas diversions, rate design, standby rates, avoided costs, and special load retention and economic development rates for industrial customers.

Clark Hill's energy clients include:

• Alchem Aluminum
• Cargill
• City of Holland, BPW
• DaimlerChrysler
• Domtar Paper Co.
• Escanaba Paper Co.
• Etkin Equities
• Ford Motor Compay
• General Motors Corp.
• MAPCo Coal
• Martin Marietta
• Michigan Environmental Council
• Michigan Sugar Company
• Public Interest Research Group in Michigan
• Redico Management
• Steelcase
• U.S. Steel
• William Beaumont Hospital

The Clark Hill Energy Team's predicts that large customers will have more choices and opportunities to manage their costs than they have had in the past. The barriers to access to the nationwide electric transmission grid are falling and, in fact, the Clark Hill's Energy Team is in the forefront of that effort in the State of Michigan. In the future, investor-owned utilities, municipal utilities, marketers, brokers, joint ventures, and a host of other new market entrants will be in a position to sell power to retail customers. The Energy Team can help manage the transition to the more competitive world, with a resultant reduction in costs. Those companies which can successfully manage the emerging markets will gain a competitive advantage over those who cannot. New opportunities will be available to all sizes of companies and if companies do not want to manage the day-to-day energy operations, there are other companies that can reasonably provide this service.