6AA81d01

Scottish and Southern

Power Distribution

Horshader Community Development LtdFAO: Rona MackayTaigh Cheann a' LochaIsle of BenbeculaWestern IslesHS7 5PJ

Scottish Hydro Electric PowerDistribution picInveralmond House200 Dunkeld RoadPerth

Our reference:

Your reference:

Date: | 11th March 2010If telephoning or calling please ask for;Keiron NicollTel. No: i 01738 4565ff 7JIZZZZ1E-mail: [email protected]

Dear Rona,

PROPOSALS TO AMEND THE AGREEMENT TO PROVIDE A CONNECTION FOREMBEDDED GENERATION AT:

HORSHADER WIND GENERATING STATION, DALBEG, ISLE OF LEWIS

On 18th August 2009 Scottish Hydro Electric Power Distribution pic ("SHEPD") and HorshaderCommunity Development Ltd entered into an agreement to provide a connection (the"Agreement") for the above embedded generation development.

SHEPD has now completed a review of the distribution works required to connect thisdevelopment. Accordingly, please find enclosed SHEPD's proposals to amend the Agreement forthe above project. These proposals would have the effect of amending the Agreement toincorporate these detailed distribution works and require to be accepted by you to take effect.We seek your acceptance of these proposals within 30 days of the date hereof.

Should you wish to accept these proposals please sign and return both copies of the encloseddocument to me at the above address by the due date. Following counter signature I shallreturn one copy for your records. Should we fail to receive your acceptance of the proposals bythe due date then SHEPD, under the provisions of Clause 26 (b) shall refer the matter to Ofgem(the "Authority").

Please note that we are not currently in a position to provide updated information in relation toany required transmission works, if applicable. We continue to liaise closely with both NationalGrid Electricity Transmission pic (NGET) and the Authority and will contact you within 6 months,if not sooner, to progress matters in respect of these works. When transmission works areknown, SHEPD reserve the right to review and amend the terms of the Agreement including,but not limited to the distribution works, costs and date(s).

SSE Power Distribution is a trading name of: SSE Power Distribution Limited Registered in Scotland No. 213459; Scottish Hydro Electric Transmission LimitedRegistered in Scotland No. 213461; Scottish Hydro Electric Power Distribution pic Registered in Scotland No. 213460; S+S Limited Registered in Scotland

No. 214382 |all having their Registered Offices at Inveralmond House 200 Dunkeld Road Perth PH1 3AQ); and Southern Electric Power Distribution pic Registered inEngland and Wales No. 4094290 having its Registered Off ice at SSVastern Road Reading RG1 8BU which are members of the Scottish and Southern Energy Group

www.scottish-southern.co.uk

If you have any questions please contact me on the telephone number or e-mail addressdetailed above.

Yours sincerely

Keiron NicollMajor Connections

Enclosed: Amendment of Agreement to Provide an Electricity Connection (2 copies

HORSHADER 900KW WIND GENERATOR

AGREEMENT TO PROVIDE A CONNECTION AMENDMENT AGREEMENT

Between

SCOTTISH HYDRO ELECTRIC POWER DISTRIBUTION PLC,

and

HORSHADER COMMUNITY DEVELOPMENT LTD

Amendment of Agreement to Provide a Connection

TABLE OF CONTENTS

1 INTERPRETATION2 VARIATION3 STATUS4 GOVERNING LAW AND JURISDICTION

(0

THIS AMENDMENT AGREEMENT IS MADE BETWEEN:

(1) SCOTTISH HYDRO ELECTRIC POWER DISTRIBUTION PLC, a company registered inScotland with registered number SC213460 and having its registered office at InveralmondHouse, 200 Dunkeld Road, Perth PH1 3AQ ("SHEPD"}; and

Horshader Community Development Ltd. A company registered in Scotland (RegisteredNo. SC277276), whose registered office is at 38 South Shawbost, Stornoway, Isle of Lewis,HS2 9BJ. (the "Customer")

WHEREAS

(A) SHEPD and the Customer are parties to an Agreement to Provide an Electricity Connectionincluding the Cover Letter dated 18th August 2009 (the "Agreement");

(B) The parties now wish to amend the terms and conditions of the Agreement as set outherein.

INTERPRETATION

Save where the context otherwise requires or as expressly set out in this AmendmentAgreement terms and expressions used in the Agreement shall be of the same meaningwhen used herein.

VARIATION

The parties agree that with effect from the last date of execution hereof the terms of theAgreement shall be amended such that the terms and conditions of the Agreement shall beas set out in the schedule hereto.

STATUS

This Amendment Agreement is supplemental to the Agreement and the benefit and /or bur-den of this Amendment Agreement shall only be capable of being assigned or otherwisetransferred by SHEPD or the Customer along with the corresponding benefit and/or burdenof the Agreement.

GOVERNING LAW AND JURISDICTION

This Amendment Agreement is governed by and shall be construed in accordance with thelaws of Scotland and the parties hereby submit to the exclusive jurisdiction of the ScottishCourts.

IN WITNESS WHEREOF this page ha been executed as follows:

SUBSCRIBED for and on behalf of

SCOTTISH HYDRO ELECTRIC POWER DISTRIBUTION PLC

by

Director/Authorised Signatory

Full name

Date

SUBSCRIBED for and on behalf of

Horshader Community Development Ltd

by

Director/Authorised Signatory

Full name

Date

SCHEDULE

This is the Schedule referred to in the HORSHADER GENERATING STATION Agreement toProvide a Connection Amendment Agreement between Scottish Hydro Electric PowerDistribution Pic and Horshader Community Development Ltd dated 18th August 2009

Dear Rona,

OFFER TO PROVIDE A CONNECTION FOR EMBEDDED GENERATION AT:

HORSHADER 900KW WIND GENERATING STATION, DALBEG, ISLE OF LEWIS

On behalf of Scottish Hydro Electric Power Distribution pic ("SHERD"), I am pleased to encloseSHEPD's Offer for Connection of the above project and wish to highlight the following Offer terms andconditions:

1. This letter, together with the attached Offer for Connection, forms the terms and conditions underwhich SHEPD offers to provide an electricity connection (the "Connection") to the Customer for thegeneration project at Horshader Wind Generating Station, Dalbeg, Isle of Lewis, (the "Offer").

In the event that the Customer accepts this Offer, the terms and conditions of this Offer and theacceptance shall form the agreement between SHEPD and the Customer (the "Agreement") in respectof the provision of the Connection,

2. Subject to the terms and conditions of this Offer, the estimated date for completion and energisationof the Connection is 31st December 2011. In accepting this Offer, the Customer is entering intobinding contractual obligations to commence and make timely progress with the generation projectand, where applicable, any Contestable Distribution Connection Works ("CDCW") to enable SHEPD tocomplete and energise the Connection by this date.

Accordingly, the Customer should note that from receipt of acceptance and any payment then due,SHEPD may immediately commence work and incur expenditure on the provision of the Connection. Inthe event that the Customer does not adequately progress the generation project and/or (whereapplicable) any CDCW to the timetable reasonably required to achieve the estimated connection date,SHEPD may exercise its rights to terminate the Agreement for the provision of the Connection. In suchevent, the Customer will be liable for all abortive costs incurred and/or committed by SHEPD and anyother costs related to the same.

Prior to accepting this Offer, the Customer should give particular consideration to itsability to progress the project and (where applicable) any CDCW to meet the contractualobligations within this Offer. If there is significant doubt in this regard or the project isspeculative at this point, the Customer has the option not to accept this Offer and make are-application to SHEPD if/when an appropriate level of contractual commitment canreasonably be made to the connection works for this project.

IsSE Power Distribution i3lhe trading name of: SSE Power Distribution Limited Registered in Scotland No,SC213459; Scottish Hydro Electric Transmission Limited Registered inScotland No.SC213461; Scottish Hydro Electric Power Distribution pic Registered in Scotland No,SC213460; S+S Limited Registered in Scotland No.SC214382; (all having their

Registered Offices at Inveralmond House 200 Dunkeld Road Perth PH1 3AQ); and Southern Electric Power Distribution pic Registered in England & Wales No.4Q94290 having itsRegistered Office at 55 Vastern Road, Reading, Berkshire, RG1 8BU. These companies are members of the Scottish and Southern Energy Group,

www. scottish-southern.co.uk

3. The completion and energisation of the Connection may be conditional and dependent on thecompletion of Transmission Construction Works on the GB Transmission System. We continue to liaiseclosely with both National Grid Electricity Transmission pic (NGFT) and Ofgem and will contact youwithin 6 months, if not sooner/ to progress matters in respect of these works. When transmissionworks are known, SHEPD reserve the right to review and amend the terms of the Agreement including,but not limited to the distribution works, costs and date(s).

4. If this Offer is dependent on Related Offers and/or Dependent Works (see, where applicable, Clauses2.7(d), 3.5, 3.6 and 5.6.1). In the event that any Related Offers are not accepted, lapse, arewithdrawn or are terminated, or any Dependent Works under a Related Offer are delayed, SHEPDreserves the right to amend or terminate this Offer or Agreement.

5. If this Offer relates to embedded generation with output of 10MW or more, in addition to acceptingthis Offer the Customer must also enter Into contract(s) with NGET to enable the Connection to beprovided and energised. The Customer may also be required to be a party to the GB Connection andUse of System Code (the "CUSC"). SHEPD recommend that, where the scale of the generation projectrequires, the Customer should contact NGET to establish which contractual arrangements they arerequired to enter into.

6. The following documents, which relate to the terms of this Offer, are available to view or downloadfrom the SSE Power Distribution website:

(a) Statement of Charging Methodology for Connection to Scottish Hydro Electric Power Distributionpic's Distribution System;

(b) Statement of Charging Methodology for Use of Scottish Hydro Electric Power Distribution pic'sDistribution System;

(c) A model/template of the Agreement Relating to the Design, Supply, Installation, Commissioningand Adoption of Electricity Connection and Distribution Equipment (the "Construction AdoptionAgreement").

The SSE Power Distribution website address is: www.ssepd.co.uk. The documents concerned arelocated under the "Technical Info" links.

Alternatively, copies of the documents may be obtained from SHEPD on request (charges may apply).

7. This Offer does not make any provision for electrical works or equipment required for the Customer'sinstallation, including protection arrangements.

It is the Customer's responsibility to assess their electrical requirements and ensure that the designand construction of the electrical works, equipment and installation, including protection arrangements,conform to all relevant standards. SHEPD circuit breakers or any other SHEPD equipment may not berelied upon as a means of providing protection or operation of the Customer's electrical works,equipment and installation either for routine or non-routine events.

2SSE Power Distribution is the trading name of: SSE Power Distribution Limited Registered in Scotland No.SC213459; Scottish Hydro Electric Transmission Limited Registered inScotland No.SC213461; Scottish Hydro Electric Power Distribution pic Registered In Scotland No.SC213460; S+S Limited Registered In Scotland No.SC214382; (all having their

Registered Offices al Inveralmond House 200 Dunkeld Road Perth PH1 3AQ); and Southern Electric Power Distribution pic Registered in England & Walas No.4Q94290 having itsRegislered Office at 55 Vastern Road, Reading, Berkshire, RG1 BBU. These companies ere members of the Scottish and Southern Energy Group.

www.scottish-southern.co.uk

In the event that the Customer wishes to rely on the use of SHEPD equipment for any of thesepurposes, it shall only be with the express prior written agreement of SHEPD. SHEPD reserves the rightto levy charges for any Customer use of its circuit breakers or equipment.

Upon receipt of a request from SHEPD, the Customer shall make available, within 5 working days,copies of risk assessments G'Risk Assessments") they have undertaken or have commissioned for theirelectrical works, equipment and installation, including their protection arrangements. SHEPD reservesthe right to: (a) review and comment on the Risk Assessments; and (b) amend the terms of this orAgreement following such review.

8. Upon receipt of a request from the Customer, SHEPD shall be pleased to provide a quotation forprovision of high voltage switchgear, protection or other equipment required by the Customer.

This Offer is open for acceptance for 30 days from the date hereof and will lapse if notaccepted within this period.

Should you wish to accept the Offer, please complete the Offer Acceptance Form and return one copyof the unconditionally accepted Offer to the above address, marked for my attention. If you have anyenquiries with respect to this Offer, please contact me on the direct telephone number or e-mailaddress indicated above.

Yours sincerely

Keiron Nicoll

Major Connections

Enclosed: Offer for Connection (2 copies)

3sSE Power Distribution is the trading name of; SSE Power Distribution Limited Registered in Scotland No.SC213459; Scottish Hydro Electric Transmission Limited Registered inScotland No.SC213461; Scottish Hydro Electric Power Distribution pic Registered in Scotland No.SC213460; S+S Limited Registered in Scotland NO.SC214382; (all having their

Registered Offices at Inveralmond House 200 Dunkeld Road Perth PH1 3AQ); end Southern Electric Power Distribution pic Registered in England 8. Wales No.4094290 having itsRegistered Office at 55 Vastern Road, Reading, Berkshire, RG1 8BU. These companies are members of the Scottish and Southern Energy Group.

www. Scottish-southern, co.uk

4sSE Power Distribution Is the trading name of: SSE Power Distribution Limited Registered in Scotland No.SC213459; Scottish Hydro Electric Transmission Limited Registered InScotland No.SC213461; Scottish Hydro Electric Power Distribution pic Regislered in Scotland No,SC213460; S+S Limited Registered In Scotland No,SC214382; (all having their

Registered Offices at Inveralmond House 200 Dunkeld Road Perth PHI 3AQ); and Southern Electric Power Distribution pic Registered In England & Wales No.4094290 having itsRegistered Office at 55 Vastern Road, Reading, Berkshire, RG1 8BU. These companies are members of the Scottish and Southern Energy Group.

www, scotti sh-so uth era co ,u k


Power Distribution

OFFER TO PROVIDE A CONNECTION FOR EMBEDDED GENERATION

at


by

SCOTTISH HYDRO ELECTRIC POWER DISTRIBUTION PLC

For

HORSHADER COMMUNITY DEVELOPMENT LTD

5SSE Power Distribution is the trading name of: SSE Power Distribution Limited Registered in Scotland No.SC213459; Scottish Hydro Electric Transmission Limited Registered inScotland No.SC213461; Scottish Hydro Electric Power Distribution pic Registered in Scotland No.SC213460; S+S Limited Registered in Scotland No.SC214382; (all having theirRegistered Offices at Inveralmond House 200 Dunkeld Road Perth PH1 3AQ); and Southern Electric Power Distribution pic Registered in England & Wales No.4094290 having its

Registered Office at 55 Vastern Road, Reading, Berkshire, RG1 8BU. These companies are members of the Scottish and Southern Energy Group.www. scottish-southern.co.uk

AMENDMENT AGREEMENT1 INTERPRETATION 12 VARIATION 13 STATUS 14 GOVERNING LAW AND JURISDICTION 2

CONNECTION OFFER1. CONDITIONS PRECEDENT 12. TYPE AND VOLTAGE OF CONNECTION..... 13. CHARGES FOR THE PROVISION OF THE CONNECTION 24. PAYMENT TERMS FOR THE CONNECTION 45. BASIS OF TERMS 56. TIME TO PROVIDE THE CONNECTION 67. POINT OF CONNECTION AND EARTHING ARRANGEMENTS 7

8. WAYLEAVES 79. OPERATION, PROTECTION AND CONTROL 7

10. METERING 811. AGREEMENTS & TECHNICAL CONSIDERATIONS 8

12. FREQUENCY OF AND FLUCTUATIONS CAUSED BY STARTING 10

13. CABLE TRACK 1014. SWITCHGEAR, PROTECTION AND METERING ACCOMMODATION 1015. PLANT, CABLE AND/OR EQUIPMENT DAMAGE 11

16. HEALTHS SAFETY 1117. DISPUTES 1218. LIABILITIES AND INDEMNITIES 12

19. FORCE MAJEURE 1320. PERIOD FOR ACCEPTANCE 13

21. TERMINATION 1322. NOTICE FOR WITHDRAWAL 15

23. ASSIGNMENT 1524. GOVERNING LAW 1525. SECURITY AND UNDERWRITING 1526. VARIATIONS 1627. WAIVER 17CUSTOMER ACCEPTANCE FORM 18APPENDIX 1: DISTRIBUTION CONNECTION WORKS 19APPENDIX 2A: ALL CONNECTION WORKS PAYMENT SCHEDULE 20APPENDIX 2B: NON-CONTESTABLE CONNECTION WORKS ONLY PAYMENT SCHEDULE 21APPENDIX 3: TRANSMISSION CONSTRUCTION WORKS 221. THE TRANSMISSION CONSTRUCTION WORKS 23

2. TRANSMISSION CONNECTION WORKS COMPLETION DATE 243. SCOPE OF TRANSMISSION CONNECTION WORKS 25

4. PAYMENT SCHEDULE OF CHARGES DUE FOR TRANSMISSION CONNECTION WORKS:.... 265. TRANSMISSION INFRASTRUCTURE WORKS 27

6. NGET UNDERWRITING 287. ADVANCE SERVICES WORK(S) ; 29APPENDIX 4: WORKING IN PROXIMITY TO OVERHEAD LINES & UNDERGROUND CABLES. 30

APPENDIX 5: GLOSSARY OF TERMS 31

Page 1


Power Distribution

OFFER TO PROVIDE A CONNECTION FOR EMBEDDED GENERATION AT:


Date of Offer: 11th March 2010

Ref:

For: HORSHADER COMMUNITY DEVELOPMENT LTD

On behalf of Scottish Hydro Electric Power Distribution pic, a company registered in Scotland(Registered No. SC213460), whose registered office is at Inveralmond House, 200 Dunkeld Road,Perth PH1 3AQ, ("SHEPD"), I am pleased to Offer to provide

Horshader Community Development Ltd. A company registered in Scotland (Registered No.SC277276), whose registered office is at 38 South Shawbost, Stornoway, Isle of Lewis, HS2 9BJ(the "Customer"),

for an electricity connection as described in condition 2 below (the "Connection") to their proposedsite at Horshader Wind Generating Station, Dalbeg, Isle of Lewis, HS2 9AE for the export and/orimport of electricity subject to the following terms and conditions.

1. CONDITIONS PRECEDENT

1.1 Where the Customer does not hold an Approved Credit Rating (as defined in Appendix 5: Glossaryof Terms), SHEPD shall not be obliged to commence any work in respect of the provision of theConnection until the Customer has provided security to SHEPD in accordance with the provisions ofClause 25 ("Security").

1.2 Where applicable, in the event the Customer wishes to construct Contestable DistributionConnection Works ("CDCW") (such Works, if any, being detailed in Appendix 1) SHEPD shall notbe obliged to commence or continue any work in respect of the provision of the Connection until theCustomer and their Independent Connection Provider ("ICP") has entered into a ConstructionAdoption Agreement in respect of the CDCW. The Customer and their ICP shall enter into theConstruction Adoption Agreement by 30th September 2010 or such other date as may be stipulatedby SHEPD. In the event that the Construction Adoption Agreement is not executed and provided toSHEPD in the required timescale, SHEPD reserves the right to:

(a) refuse to commence or continue work on the provision of the Connection; and/or,

(b) to terminate this Agreement in which event the provisions of Clause 21.7 shall apply.

In the event that SHEPD does not exercise its right to terminate this Agreement pursuant to Clause1.2 (b) but exercises its rights under Clause 1.2 (a) then, without prejudice to the right of SHEPD toterminate at any time pursuant to Clause 1.2(a), SHEPD shall be entitled to amend this Agreement(including, without limitation, any of its Appendices).

2. TYPE AND VOLTAGE OF CONNECTION

2.1 Subject to the terms and provisions of this Offer, the Connection will be provided at the wind farmwith the following characteristics:

(a) Connection voltage: 11,000 Volts,

(b) 3 phase,3 wire

(c) Frequency: 50 Hertz

(d) Maximum Export (generation) Capacity: 900 kilowatts (kW)

(e) Maximum Import (demand) Capacity: 20 .kilowatts (kW)

(f) Power factor range: 0.95 Lead - 0.95 Lag at the point of connection. See also clause 9.2.

Page 2

The Customer shall maintain the stated power factor range for all levels of generation output inaccordance with the requirements of, where applicable, the Grid Code and the Distribution Code.

2.2 Subject to the terms and provisions of this Offer, a second connection will be provided at the windfarm for the purposes of auxiliary supply with the following characteristics:

(a) Connection voltage: 400/230 Volts,

(b) 3 phase, 4 wire

(c) Frequency: 50 Hertz

(d) Maximum Import (demand) Capacity: 50 kilowatts (kW)

2.3 Energisation shall be conditional on the Customer ensuring their generation output is balancedacross all three phases at all times.

2.4 All works at a distribution voltage necessary for the Connection (the "Distribution ConnectionWorks") which are within SHEPD substations or on existing plant, circuits and equipment will becarried out by SHEPD and are referred to as Non-Contestable Distribution Connection Works.

2.5 The Non-Contestable Distribution Connection Works and the CDCW in this Offer are detailed withinAppendix 1.

2.6 Transmission Construction Works on the GB Transmission System are required to enable theprovision of the Connection. The scope of the Transmission Construction Works are indicated inAppendix 3. All such Works are subject to the provisions of this Offer which allow for theiramendment.

2.7 The provision of the Connection is based on:

(a) SHEPD completing the Non-Contestable Distribution Connection Works and;

(b) SHEPD or the Customer (as may be applicable) completing the CDCW;

(c) Where applicable, NGET unconditionally and unequivocally confirming in writing toSHEPD that:

(i) all Transmission Construction Works (if applicable) have been completed to the extentnecessary to enable energisation of the Connection; and,

(ii) the conditions set out in Paragraphs 6.5.1 and 6.5.2 of NGET's Connection and Use ofSystem Code ("CUSC") have been satisfied.

(d) Not used

3. CHARGES FOR THE PROVISION OF THE CONNECTION

3.1 The Customer shall inform SHEPD, upon acceptance, which of the Distribution Connection WorksConnection Options detailed in Clauses 3.8 and 3.9 will apply.

3.2 If the Customer does not inform SHEPD in writing otherwise Clause 3.8 shall be deemed to be thepreferred Distribution Connection Works Connection Option and charges will be made and workscarried out for that Distribution Connection Works Connection Option.

3.3 Where appropriate and in accordance with the "Statement of Charging Methodology for Connectionto Scottish Hydro Electric Power Distribution pic's Distribution System", as amended from time totime, the Connection Options detailed in Clauses 3.8 and 3.9 may include charges for the ongoingoperation and maintenance of SHEPD connection equipment and plant for the term of the enduringconnection agreement.

PageS

3.4 Use of System Charges

3.4.1 Generation Distribution Use of System charges ("GDUoS").

The Customer's liability for GDUoS charges shall be based on the following criteria:

(a) A Customer who applied for Connection to SHEPD up to 31 December 2004 shall notbe liable for GDUoS charges until 1st April 2010 unless SHEPD's ChargingMethodology is revised, changed and approved by the Authority.

(b) A Customer who applied for Connection to SHEPD from 1 January 2005 shall be liablefor GDUoS charges from the Connection Start Date (as defined within Appendix 5).

The value of GDUoS charges are indicated in the "Statement of Charges for Use of ScottishHydro Electric Power Distribution pic's Distribution System", as amended from time to time.

3.4.2 At the date of this Offer, NGET Use of System Charges ("TNUoS Charges") are notchargeable to generators that are embedded on the Distribution network ("EmbeddedGenerators").

3.4.3 SHEPD reserves the right to impose a levy on the Customer and the Customer shall be liableto pay any applicable charges for Use of System, including (but not limited to) TNUoS andGDUoS charges on Embedded Generators at any time in the event that the NGET and/orSHEPD Charging Methodology is/are amended and approved by the Authority.

3.5 The provision of the Connection including, but not limited to, the charges for the Connection, isconditional on all other Customers who have applied for a connection to a part or parts of thesystem accepting their Offers for Connection ("Related Offers").

3.6 In the event that any Related Offers are not accepted, lapse, are withdrawn or are terminated or theworks thereunder are delayed, SHEPD reserves the right to amend or terminate this Offer orAgreement and any agreement that SHEPD has entered into with NGET in respect of theConnection to which this Offer relates.

3.7 In the event that the Customer does not accept, allows the lapse of or rejects their Offer forConnection and subsequently submits a further application within twelve months of the originalapplication, SHEPD shall refer such further application to the Gas and Electricity Markets Authority(the "Authority") for their consideration, if in the view of SHEPD, the further application does notrepresent a significant change from the original application.

3.8 Connection Option 1 (All Distribution Connection Works)

3.8.1 The Customer will be required to pay the sum of £577,178 (five hundred and seventy seventhousand one hundred and seventy eight Pounds Sterling) to SHEPD in respect of theprovision, erection, laying and installation of the necessary SHEPD plant and equipmentrequired for the provision of the Connection. SHEPD will carry out ALL the DistributionConnection Works required, subject to the Customer providing any other works and accessarrangements, as specified in Appendix 1.

3.8.2 The value above includes charges of £76,960 (Seventy Six Thousand, Nine Hundred andSixty Pounds Sterling) (exclusive of VAT) for the ongoing operation and maintenance ofSHEPD connection equipment and plant for the duration of the EGCA (the maximum periodbeing 20 years from energisation).

3.9 Connection Option 2 (The Non-Contestable Distribution Connection Works only)

3.9.1 The Customer will be required to pay the sum of £131,895 (one hundred and thirty onethousand eight hundred and ninety five Pounds Sterling) to SHEPD in respect of the Non-contestable Distribution Connection Works required for the provision of the Connection. TheCustomer will be required to provide the CDCW together with any other works and accessarrangements all as specified in Appendix 1.

3.9.2 The value above includes charges of £76,960 (Seventy Six Thousand, Nine Hundredand Sixty Pounds Sterling) (exclusive of VAT) for the ongoing operation andmaintenance of SHEPD connection equipment and plant for the duration of the EGCA(the maximum period being 20 years from energisation).

Page 4

3.10 Transmission Construction Works

In its role as GB Transmission System Operator, NGET may impose certain conditions and/orprovisions including, but not limited to charges and/or underwriting requirements, for TransmissionConstruction Works and also impose restrictions or modifications on the Connection of theCustomer's generation facility.

SHEPD reserves the right to vary:

(a) the scope of the Connection and/or any restrictions or modifications on the Connection;

(b) the scope of the Distribution Connection Works; and,

(c) any other provisions of this Offer including, without limitation, the Connection date, thecharges for the Connection and security requirements of the Customer,

to take account of any costs, restrictions, conditions, provisions or modifications notified by NGETrelating to the Connection.

3.11 SHEPD shall be entitled to recover from the Customer and the Customer agrees to pay to SHEPD,in addition to any charges payable by the Customer to SHEPD in relation to the DistributionConnection Works, the costs detailed in Appendix 3 in respect of the Transmission ConstructionWorks including, without limitation, the Customer's liability for NGET underwriting in the event oftermination of this Agreement by either the Customer or SHEPD. The initial estimate of NGETunderwriting is indicated in Appendix 3, Item 6.

3.12 Not used

4. PAYMENT TERMS FOR THE CONNECTION

4.1 All sums stated within this Offer or Agreement are exclusive of VAT, which will be applied at theapplicable rate.

4.2 The Customer, on returning their acceptance of this Offer, must clearly state which Payment Optionthey have chosen. Where staged payments apply, SHEPD will send the Customer an invoice foreach stage of the appropriate Payment Schedule.

4.3 Full payment of all invoiced sums must be received by SHEPD within 30 days of the issue date ofany invoice. If the Customer fails to make payment of any sums due to SHEPD under the terms ofthis Agreement, SHEPD reserves the right to:

(a) refuse to commence or to continue work on the provision of the Connection until payment isreceived; and/or

(b) to charge interest at 3% above the base lending rate of The Royal Bank of Scotland piccalculated on a daily basis on the outstanding payment(s) over the period they remainunpaid; and/or

(c) to terminate this Agreement in which the provisions of Clause 21.7 shall apply.

In the event that SHEPD does not exercise its right to terminate this Agreement pursuant to Clause4.3 (c) but exercises its rights under Clause 4.3 (a) and/or (b) then, without prejudice to the right ofSHEPD to terminate at any time pursuant to Clause 4.3 (c), SHEPD shall be entitled to amend thisAgreement (including, without limitation, any of its Appendices).

4.4 SHEPD will require full payment of the charges for the Connection (plus any interest due, whereapplicable) prior to energisation of the Connection.

4.5 PAYMENT TERMS FOR THE DISTRIBUTION CONNECTION WORKS

4.5.1 Payment Option 1 for Connection Option 1 (Full Payment of All Distribution ConnectionWorks)

The Customer will be required to make full payment of £577,178 (five hundred and seventy seventhousand one hundred and seventy eight Pounds Sterling) to SHEPD in respect of the charges forthe Distribution Connection Works on acceptance of this Offer. An invoice for this amount, less anyappropriate credits in respect of sums paid to date, will be issued on receipt of acceptance. For theavoidance of doubt, SHEPD shall not commence work on the provision of the Connection until thispayment is received.

Page5

4.5.2 Payment Option 2 for Connection Option 1 (Staged Payments of All Distribution ConnectionWorks)

4.5.2.1 The Customer will be required to make an initial payment of £144,295 (one hundred andforty four thousand two hundred and ninety five Pounds Sterling) to SHEPD in respect ofpart payment of the charges for the Distribution Connection Works on acceptance of thisOffer. An invoice for this amount will be issued on receipt of acceptance. For theavoidance of doubt, SHEPD shall not commence work on the Connection until thispayment is received.

4.5.2.2 The remaining balance of £432,884 (four hundred and thirty two thousand eight hundredand eighty four Pounds Sterling) of the charges in respect of the Distribution ConnectionWorks will be paid to SHEPD in accordance with the Payment Schedule, which will includecredit(s) due for sums paid to date, set out in Appendix 2A of this Offer.

4.5.3 Payment Option 1 for Connection Option 2 (Full Payment of the Non-Contestable DistributionConnection Works only)

4.5.3.1 The Customer will be required to make full payment of £131,895 (one hundred and thirtyone thousand eight hundred and ninety five Pounds Sterling) to SHEPD in respect of thecharges for the Non-Contestable Distribution Connection Works on acceptance of thisOffer. An invoice for this amount, less any appropriate credits in respect of sums paid todate, will be issued on receipt of acceptance. For the avoidance of doubt, SHEPD shallnot commence work on the provision of the Connection until this payment is received.

4.5.4 Payment Option 2 for Connection Option 2 (Staged Payments of the Non-ContestableDistribution Connection Works only)

4.5.4.1 The Customer will be required to make an initial payment of £32,973 (thirty two thousandnine hundred and seventy three Pounds Sterling) to SHEPD in respect of part payment of thecharges for the Distribution Connection Works on acceptance of this Offer. An invoice for thisamount will be issued on receipt of acceptance. For the avoidance of doubt, SHEPD shall notcommence work on the Connection until this payment is received.

4.5.4.2 The remaining balance of £98,922 (ninety eight thousand nine hundred and twenty twoPounds Sterling) of the charges in respect of the Distribution Connection Works will be paid toSHEPD in accordance with the Payment Schedule, which will include credit(s) due for sumspaid to date, set out in Appendix 2A of this Offer.

4.6 PAYMENT TERMS FOR TRANSMISSION CONNECTION WORKS

4.6.1 Payment Option 1 - Full Payment of Transmission Connection Works.

4.6.1.1 To be advised.

4.6.2 Payment Option 2 - Staged Payments of the Transmission Connection Works only



5. BASIS OF TERMS

5.1 The terms of this Offer are based on application information submitted to SHEPD by the Customer.Should any such information be later shown to be incorrect and have a material bearing on theterms of this Offer or Agreement, then SHEPD reserves the right to revise any affected termsincluding, but not limited to, the charges for the Connection, so as to put SHEPD back in the sameposition as it would have been had the correct information been known prior to the date hereof.

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5.2 Upon acceptance of this Offer (subject to the completion of the Connection being dependent uponTransmission Construction Works which may delay commencement of the Distribution ConnectionWorks), SHEPD reserves the right to and the Customer shall commence forthwith their respectiveelements of the Distribution Connection Works. The parties hereby agree to meet regularly andprovide each other with progress updates on their respective elements of the Connection works andthe Customer shall also provide progress reports relating to the generation facility and electricalworks. A programme of progress meeting dates shall be agreed between the parties respectiveProject Managers as soon as reasonably practicable after acceptance of the Offer by the Customer.

5.3 The Electricity (Connection Charges) (Amendment) Regulations 2002

5.3.1 The Customer may qualify to receive a future rebate (the "CCR Rebate) in respect of aproportion of the charges for the initial provision of distribution electrical lines and distributionelectric plant required to provide the Connection from a person (the "Subsequent Customer")requiring a subsequent connection and who shall use those lines and plant within 5 years oftheir initial provision.

5.3.2 A Customer's qualification to receive a CCR Rebate and the value of any CCR Rebate shallbe subject to the terms of the Electricity (Connection Charges) (Amendment) Regulations2002 (the "CCR 2002") (as amended from time to time). For the avoidance of doubt, no CCRRebate shall be due to the Customer in the event that the CCR 2002 are repealed orsuperseded.

5.4 Rules of Cost Apportionment ("RCA"):

5.4.1 Not used.

5.5 Metals Fluctuation

5.5.1 In the event that movement in the price of metals to be used in cable and/or overhead lineworks (as applicable) results in either decreased or increased charges for the Connection(the "Amended Price") the Customer agrees and hereby undertakes to pay the AmendedPrice.

5.5.2 SHEPD shall amend the relevant Payment Schedule, where applicable, to take account ofthe Amended Price and the Customer agrees and hereby undertakes to make payment inaccordance therewith.

5.6 Other Connection Dependencies

5.6.1 The provision of the Connection is based on:

5.6.1.1 The provision and installation of Reactive Power Compensation Equipment("RPCE") which shall require to be ordered from a specific manufacturer not lessthan 12 months prior to the commencement of the Connection works. The RPCE isdescribed in Appendix 1; Distribution Connection Works. Accordingly, the cost ofConnection indicated in Clause 3.8 and the Connection's Completion Date indicatedin Clause 6.1 is dependent on the availability of the RPCE. In the event that SHEPDrequires to procure the RPCE under the Offer's Connection Option 1: AllDistribution Connection Works and:

(i) the RPCE (or an equivalent RPCE) is not available to SHEPD at therequired time; or,

(ii) the cost of said RPCE (or an equivalent RPCE) has increased; or,

(iii) HM Customs and Excise re-classify the Commodity Code of the RPCEand/or rate of import duty payable; or,

(iv) there is currency fluctuation or more than plus or minus 2.5 % in the US $/Pound Sterling £ exchange rate, such exchange rate being based on theexchange rate applicable at date of issue of this Offer ($1.64/ £1), or, anequivalent currency fluctuation if the RPCE is procured from a non USsupplier.

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then SHEPD reserve the right to amend the charges indicated in Clause 3.8 andestimated completion date indicated in Clause 6.1 to take account of costsincreases or delays to the programme of Connection Works.

5.7 The Customer in accepting this Offer, or the person acting on their behalf, shall note that S+SLimited may act as the agent of SHEPD with respect to the Distribution Connection Works.

6. TIME TO PROVIDE THE CONNECTION

6.1 SHEPD estimate that subject to:

(a) the provisions and conditions of this Offer; and

(b) all necessary wayleaves and consents for the Distribution Connection Works being obtainedin sufficient time to allow SHEPD to progress the Connection by the estimated completiondate below, and;

(c) all necessary site works being at the appropriate stage including (where applicable) theCustomer having completed the CDCW or any parts thereof and any other works and allaccess arrangements as may be specified in Appendix 1 by a dates or dates to be agreed bythe Parties (where the parties fail to agree such date(s), the date(s) shall be as stipulated bySHEPD);

it can update the Connection by 31 st December 2011.

Please note that no plant or equipment will be ordered by SHEPD or works will commence untilSHEPD receive unconditional acceptance of this Offer and the initial payment due under theselected Payment Option. SHEPD reserves the right to amend the estimated completion dateabove at its absolute discretion in the event that a delay occurs in relation to the matters referred toin sub-clauses (b) and (c) above.

7 POINT OF CONNECTION AND EARTHING ARRANGEMENTS

(a) Service Details:

The point of connection for the 11 kV supply will be the wind farm side terminals of SHEPD's11 kV metering circuit breaker unit at the wind farm site.

The point of connection for the 400/230 volt auxiliary supply will be SHEPD's service cabletermination.

(b) Earthing Details

The Customer shall be responsible for providing the necessary earthing arrangements in linewith Engineering Recommendation G59/1 "Recommendations for Embedded Generation"and the latest IEE Regulations. All generating station and substation earthing must complywith statutory requirements and national standards.

In the case of the 230 volt auxiliary supply, SHEPD will confirm with the Customer the type ofearthing connection on acceptance of this Offer and the type of earthing connectionconfirmed by SHEPD will be accepted by the Customer.

(c) Other Considerations

The Customer must comply with Engineering Recommendations 05/4 "Limits for Harmonicsand Engineering Recommendation P28 "Planning Limits for Voltage Fluctuation".

The Customer must design and install a private high voltage network incorporating suitableprovisions to protect and operate their own installation.

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8. WAYLEAVES

8.1 The provision of the Connection and meeting the estimated completion date(s) will be subject to theCustomer granting or securing for SHEPD and/or {if applicable) Scottish Hydro ElectricTransmission Limited ("SHETL") in respect of the Transmission Construction Works, free of charge,any wayleaves or other necessary facilities for all electric lines and works required for the purposesof the Connection along a route approved by SHEPD and/or SHETL on, over or through theproperty owned or leased by the Customer or under the control of the Customer. The Customershall give advice and assistance to SHEPD, NGET and/or SHETL to the extent reasonably requiredby the aforesaid for the purposes of obtaining consents, wayleaves or other necessary facilities forall electric lines and works on third party land in respect of the Transmission Construction Worksrequired for the Connection.

8.2 If any trees on such ground referred to in Clause 8.1 require to be pruned or removed, in order toprevent interference with the construction, maintenance or working of the electric lines, works orother plant, such trees will, when required by SHEPD and/or SHETL, be pruned or removed by theCustomer free of charge to SHEPD.

8.3 The provision of the Connection meeting the completion date(s) will also be subject to SHEPDand/or SHETL securing any wayleaves or other necessary consents including statutory consents orapprovals for all electrical lines and works required for the purposes of the Connection along theroute approved by SHEPD and/or SHETL on, over or through property not owned, leased by orunder the control of the Customer and the obtaining of all necessary statutory consents andregulatory approval.

8.4 SHEPD reserves the right to amend the terms and conditions of the Agreement in particular as toprogramme and charges set out in this Offer (but that only to the extent that such non-obtained ordelayed wayleaves, statutory consents and other approvals have a material bearing on suchprogramme or charges) in the event SHEPD and/or SHETL is unable (having used reasonableendeavours) to obtain the necessary wayleaves, statutory consents and other approvals, all ofwhich (and any conditions attached thereto) are in terms acceptable to SHEPD and/or SHETL, forall electric lines and works necessary for the Connection.

9. OPERATION, PROTECTION AND CONTROL

9.1 The generation owned and operated by the Customer will be subject to the terms of the Grid Codeand the Distribution Code.

9.2 The generator output at 11 kV at the metering circuit breaker must not exceed 1.012 per unit (e.g.11.132 kV). Provision must be made by the Customer to ensure that the generating station can beoperated with a fixed programmable power factor that fully complies with SHEPD's operatingrequirements.

9.3 SHEPD will provide a local emergency trip facility for the 11kV metering circuit breaker.

9.4 The 33 kV & 11 kV circuits which will serve the Connection only provide single circuit security. Byaccepting this Offer based on this configuration, the Customer acknowledges and accepts that if afault occurs anywhere on these circuits, the Connection will not be available for the full equipmentrepair time.

9.5 The Customer acknowledges that under the terms of the Grid Code and the Distribution Code, theCustomer's plant may also be subject to operational constraints related to planned or unplannedworks on SHEPD's Distribution System and/or the GB Transmission System which result in adepletion of distribution network capacity. SHEPD will use its reasonable endeavours to reduce theimpact, but the Customer acknowledges that some constraint is inevitable.

9.6 SHEPD will not be liable for any loss incurred from generation disconnection as a result of a fault ormaintenance on any part of the SHEPD network or any fault or maintenance on the GBTransmission System.

9.7 The Customer will provide protection and control to comply with Engineering RecommendationsG59/1 and G75/1 at the generating station.

9.8 SHEPD will witness all protection and control testing, including the Customer's generationprotection schemes, to ensure compliance with Engineering Recommendations G59/1 and G75/1.

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9.9 SHEPD will coordinate protection relay settings with the Customer to ensure discrimination betweenthe respective protection equipment.

9.10 DG Network Unavailability Rebate

9.10.1 Not used.

10. METERING

10.1 The charges for the Connection do not include the cost of the required metering, modem orcommunications link required for the Connection. The Customer is responsible for meeting all costsassociated with the installation of metering.

10.2 The Customer shall be required to enter into a Meter Operator Agreement with a Meter Operatorand advise SHEPD which Meter Operator has been appointed prior to energisation of theConnection.

10.3 It may be necessary to have an additional meter installed to record import and if so required theCustomer shall be responsible for meeting ail costs associated with the installation of such importmetering.

10.4 Metering panels and multicore wiring to connect to the metering voltage and current transformersshall be supplied and installed by SHEPD or the Customer, depending on the Customer's form ofacceptance of this Offer. The metering panels shall be located by mutual agreement between theCustomer and SHEPD and shall be suitable for the requirements of the appointed Meter Operator.The Meter Operator shall install import/export metering compliant with and installed in accordancewith the appropriate Code of Practice. The metering shall be programmable, able to record data athalf-hourly intervals, able to be read remotely and capable of recording kW and kVArh for bothimport and export.

10.5 A modem and communications link for the metering must be provided by the Customer (either byway of a dedicated BT exchange line or an alternative PAKNET radio communication service). TheCustomer shall be responsible for meeting all costs associated with the installation and rental ofsuch communication links.

10.6 The customer will be responsible for supplying, installing and maintaining a suitabletelecommunications link and modem for the Power Quality Data Recorder at no cost to SHEPD.

11. AGREEMENTS & TECHNICAL CONSIDERATIONS

11.1 Prior to the final connection and/or commissioning and/or energisation of the generation facility, theCustomer shall be required to enter into or become a party to agreements or Codes which relatespecifically to the proposed Connection (and the Customer providing documentary evidence toSHEPD of same or where a party to the CUSC, NGET confirming to SHEPD) including inter alia:

(a) An Embedded Generation Connection Agreement ("EGCA") with SHEPD in respect of theConnection; and,

(b) An Operating/Site Responsibility Agreement which outlines the operating responsibilities withregard to the Connection; and,

(c) In the event the Customer wishes to construct CDCW (where applicable), a ConstructionAdoption Agreement;

SHEPD shall make available to the Customer SHEPD's specifications for CDCW, TheCustomer shall ensure that any CDCW shall satisfy SHEPD's adoption requirements. TheCustomer and ICP will be required to enter into the Construction Adoption Agreement by 301h

September 2010 or such other date as may be stipulated by SHEPD;

(d) Where the Customer will trade the electricity generated at the facility through a LicensedSupplier in SVA,

(aa) a supply agreement with an Authorised Electricity Operator who is a party to theDistribution Connection and Use of System Agreement (the "DCUSA").

(bb) a power purchase agreement with an Authorised Electricity Operator who is party tothe DCUSA, a party to the Balancing and Settlement Code and a party to the CUSC;

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(cc) the CUSC and any supplemental agreement required pursuant to the CUSC.

(e) Where the Customer will trade independently the electricity generated at the facility in CVA,

(aa) the CUSC and any supplemental agreement required pursuant to the CUSC;

(bb) the Balancing and Settlement Code

(cc) a supply agreement with an Authorised Electricity Operator who is a party to theDCUSA; or

(f) Where the Customer will trade the electricity generated by the facility through a consolidatorin CVA,

(aa) where applicable, the CUSC and any supplemental agreement required pursuant tothe CUSC;

(bb) an agreement with a consolidator who is a party to the BSC; and

(cc) a supply agreement with an Authorised Electricity Operator who is a party to theDCUSA.

(g) Any further agreements, documentation or arrangements in relation to the Connection which NGETrequires or requests the Customer to become a party to or enter into, together with, but not limitedto NGET;

All necessary agreements must be completed prior to the final connection and/or commissioning ofthe facility, but nothing herein contained nor any drafts submitted in connection with the aboveagreements shall be binding on either party as to the final form and content of such agreement untileach such agreement is finally agreed and executed by the parties.

11.2 It is a condition of this Offer that the Customer's installation must be installed, operated andmaintained in accordance with the technical engineering requirements of (as applicable) the GridCode and the Distribution Code and the Customer shall also comply with, inter alia, the followingEngineering Recommendations

(a) Engineering Recommendation G59/1 ("RECOMMENDATIONS FOR THE CONNECTION OFEMBEDDED GENERATING PLANT TO REGIONAL ELECTRICITY COMPANIESDISTRIBUTION SYSTEM")

(b) Engineering Recommendation G75/1 ("RECOMMENDATIONS FOR THE CONNECTION OFEMBEDDED GENERATING PLANT TO PUBLIC DISTRIBUTION SYSTEMS ABOVE 20 kVOR WITH OUTPUTS OVER 5 MW").

(c) Engineering Recommendation G5/4 ("PLANNING LEVELS FOR HARMONIC VOLTAGEDISTORTION AND THE CONNECTION OF NON-LINEAR EQUIPMENT TOTRANSMISSION SYSTEMS AND DISTRIBUTION NETWORKS IN THE UNITEDKINGDOM")

(d) Engineering Recommendation P28 (PLANNING LIMITS FOR VOLTAGE FLUCTUATIONSCAUSED BY INDUSTRIAL, COMMERCIAL AND DOMESTIC EQUIPMENT IN THE UK)

all as published by the Energy Networks Association, Dean Bradley House, 52 Horseferry Road,London, SW1P 2AF (or its successor) and in force from time to time.

11.3 SHEPD will not energise the Connection until:

(a) It is satisfied that the applicable requirements of Clauses 11.1 and 11,2 have been met;

(b) Where applicable, the Customer has completed the Use of System Application (Generators)and has entered into a Bilateral Agreement in the appropriate form with NGET and, where theCustomer is not already a party to the CUSC, has entered into an Accession Agreement withNGET; or

(c) NGET has unconditionally and unequivocally confirmed in writing to the Customer that it doesnot require the Customer to enter into any such agreements;

and the Customer has provided documentary evidence of same to SHEPD; and,

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(d) NGET has unconditionally and unequivocally confirmed in writing to SHEPD that (whereapplicable) all Transmission Construction Works have been completed to the extentnecessary to enable energisation of the Connection.

12. FREQUENCY OF AND FLUCTUATIONS CAUSED BY STARTING

12.1 The voltage depressions experienced by the supply network due to startup loads must not exceedthe limits set out in Engineering Recommendation P28 "PLANNING LIMITS FOR VOLTAGEFLUCTUATIONS CAUSED BY INDUSTRIAL, COMMERCIAL AND DOMESTIC EQUIPMENT INTHE UK" and the Customer must establish procedures to ensure adherence to any agreedoperational parameters.

12.2 The maximum permissible voltage fluctuation at the Point of Common Coupling (PoCC) is 1% forfrequent starting events and 3% for infrequent starting events. Frequent starting is defined as morethan one event in a two hour period. This is based on SHEPD guidelines derived from EngineeringRecommendation P28. Should a more detailed application of P28 be required, then the Customershall demonstrate compliance with this standard to SHEPD.

12.3 The PoCC is taken to be the 11 kV metering switchgear at Horshader Wind Generating Station. Theminimum fault level at the PoCC is calculated to be 6 MVA which limits the mag. inrush current to 4arnps at 11 kV for frequent starting events, and 11 amps at 11 kV for infrequent starting events.

13. CABLE TRACK

13.1 The Cost for the Connection is dependent on any cable track works at the premises (as may befurther defined within Appendix 1), and as may be further required by NGET and/or SHETL inrespect of the Transmission Construction Works, being carried out by the Customer to thereasonable satisfaction of SHEPD's Engineer and at no cost to SHEPD. In the event the Customerfails to carry out the cable track works or provide the necessary earthing arrangements or carry outany other works which affect the provision of the Connection and such failure results in SHEPDbeing unable to complete or delays the completion of the Connection and/or results in an increasein costs to SHEPD, SHEPD shall not be obliged to continue with any works under the Agreementuntil the Customer has remedied such failure and/or agreed to pay any necessary and reasonableadditional costs incurred by SHEPD as a result of such failure.

14. SWITCHGEAR, PROTECTION AND METERING ACCOMMODATION

14.1 The Customer shall provide a level, substation site and all associated civil works to accommodatethe RPCE, SHEPD's 11kV switchgear, GRP enclosure and associated equipment at HorshaderWind Generating Station at no cost to SHEPD. Alternatively, the Customer may construct a suitableswitchroom building to accommodate SHEPD's plant and equipment to comply with SHEPD'srequirements and at no cost to SHEPD.

14.2 The Customer shall provide to SHEPD an unrestricted right of vehicular and pedestrian access toand egress from the switchroom at no cost to SHEPD.

14.3 A wall space, measuring 1000mm deep x 1500mm high x 1000mm wide, within the Customer'sprotection and metering enclosure shall be provided to SHEPD by the Customer, at no cost toSHEPD, in a position specified by SHEPD for the positioning of SHEPD's metering and protectionequipment and as may be further specified in Appendix 1.

14.4 Not Used.

14.5 Not used.

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15. PLANT, CABLE AND/OR EQUIPMENT DAMAGE

15.1 SHEPD will undertake the repair of any of its own cable, plant and/or equipment damaged on thesite of the Connection works by the Customer or anyone for whom the Customer is responsible inlaw provided that the Customer will be liable for the reasonable cost of the repair which will becharged to the Customer at the then current rates for time and materials.

15.2 In addition to obligations arising under Clause 15.1 where NGET are required to undertakeTransmission Construction Works in relation to the Connection, SHEPD shall procure the repair ofany of such Transmission Construction Works including any cable, plant and/or equipmentdamaged on the site of the Connection Works by the Customer or anyone for whom the Customeris responsible in law provided that the Customer will be liable for the reasonable cost of the repair..

16. HEALTH & SAFETY

16.1 The Customer shall grant to SHEPD and as may be further required by NGET and/or SHETL (asapplicable) in respect of any Transmission Construction Works their respective employees andagents all necessary rights of access to the Customer's premises or site necessary to enableSHEPD to exercise its rights and fulfil its obligations under this Offer provided that any of SHEPD's,NGET's and/or SHETL's employees, agents or contractors and sub-contractors or others for whomthey are responsible in law to whom access is given pursuant to this Clause:

(a) shall comply with all reasonable directions given by the Customer and its respectiveappropriately authorised employees and agents in relation to general safety and securityrules and procedures in force at the Customer's premises from time to time and which shallhave been brought to the attention of SHEPD, NGET and/or SHETL; and

(b) shall remain the responsibility of SHEPD, NGET and/or SHETL who shall direct them to act ina proper, safe and workmanlike manner and at all times having regard to any requisite healthand safety rules regulations and industry relevant guidelines in respect of the ConnectionWorks.

16.2 SHEPD, in respect of the Distribution Connection Works, and NGET and/or SHETL (as applicable)in respect of any Transmission Construction Works, reserves the right to stop work and remove allSHEPD, NGET and/or SHETL employees, officers, agents and SHEPD, NGET and/or SHETLequipment from the Customer's premises or site if in SHEPD's, NGET's and/or SHETL's reasonableopinion the Health & Safety at Work Act 1974 and its associated Regulations are not beingcomplied with by the Customer at the relevant premises or site(s).

16.3 SHEPD, in respect of the Distribution Connection Works and NGET and/or SHETL (as applicable)in respect of any Transmission Construction Works will not allow its employees, officers and agentsto return to the Customer's premises or site nor to restart the work until satisfied the Customer iscomplying with the said Act and its associated Regulations.

16.4 The Customer shall bring this requirement to the attention of the Customer's employees,contractors and subcontractors working on the premises or site(s).

16.5 Where the Connection is to be provided for a wind farm development, the Customer shall ensurethat the minimum horizontal clearance from the centre of each wind turbine tower to the nearestoverhead line conductor is not less than 1.5 times the height of the completed wind turbine,measured from the blade tip at its highest position to normal ground level.

16.6 The Customer shall comply with the other safety requirements indicated in Appendix 4: Working inProximity to Overhead Lines & Underground Cables attached to this Offer.

16.7 This Offer is made on the basis that the Distribution Connection Works and/or TransmissionConstruction Works will not be undertaken on contaminated land. SHEPD, SHETL and/or NGETshall be entitled to refuse to commence or continue work in the event that it becomes aware thatany of the Works are to be undertaken on land identified as contaminated. The Customer shall beresponsible for remedial works on property owned or leased by the Customer or under the control ofthe Customer, to the reasonable satisfaction of SHEPD, SHETL and/or NGET (as applicable).Where the contaminated land is not on property owned or leased by the Customer or under thecontrol of the Customer, the Customer shall be liable to pay any additional costs incurred bySHEPD, howsoever incurred.

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17. DISPUTES

17.1 The Customer's attention is drawn to Condition 7 of the SHEPD Distribution Licence which theparties accept without limitation applies to any dispute between SHEPD and the Customer inrelation with any of the terms of this Offer including issues relating to the Connection Works andprovides that any such dispute may be referred by either SHEPD or the Customer to the Authorityfor their determination. .

17.2 Nothing contained in this Offer shall prevent or inhibit the Customer in referring any matter ordispute to the Authority for their determination under any applicable terms of the Electricity Act1989, as amended.

18. LIABILITIES AND INDEMNITIES

18.1 Subject to Clause 18.4 hereof and save where any provision of this Agreement (as defined inClause 21.1 hereof) provides for an indemnity, the respective liability of SHEPD and the Customer(and their respective officers, employees, contractors or agents) (the "Party Liable") to the other(and its respective officers, employees, contractors or agents) in contract, delict, negligence orotherwise arising out of or in relation to this Agreement shall be limited to one million poundssterling (£1 million) per incident or series of related incidents.

18.2 Nothing in this Agreement shall exclude or limit the liability of the Party Liable for death or personalinjury resulting from the negligence of the Party Liable, or any of their officers, employees,contractors or agents, and the Party Liable shall indemnify and keep indemnified the other party, itsofficers, employees, contractors or agents, from and against all such and any loss or liability whichsuch other party may suffer or incur by reason of any claim on account of death or personal injuryresulting from the negligence of the Party Liable or any of its officers, employees, contractors oragents.

18.3 In relation to third party claims for damage to property belonging to that third party only, each ofSHEPD and the Customer shall indemnify and keep indemnified the other from and against alllosses, damages, costs (including legal costs), claims or other liability that arises as a direct resultof the indemnifying party's or its officers', employees', contractors' or agents' negligent or wilful actor omission or breach of this Agreement provided that the indemnified party shall not compromiseor settle any such claims, costs, proceedings or demands without the written consent of theindemnifying party (which shall not be unreasonably withheld) and shall permit the indemnifyingparty to defend the same in the name of the indemnified party at the indemnifying party's expense.

18.4 Subject to Clause 18.3, neither SHEPD nor the Customer (nor any of their respective officers,employees or agents) shall in any circumstances whatsoever (including, without limitation,negligence) be liable to the other, arising out of or in Connection with this Agreement, for any:-

(a) any direct or indirect loss of profits, business or anticipated savings; or

(b) loss of revenue, loss of use, loss of contract or loss of goodwill; or

(c) any indirect or consequential loss.

18.5 Each provision of this Clause excluding or limiting liability shall be construed separately, applyingand surviving even if for any reason one or other of these provisions is held inapplicable orunenforceable in any circumstances and shall remain in force notwithstanding the expiry ortermination of this Agreement. ^

18.6 Subject to Clauses 18.7 and 18.8 and to the following provisions of this Clause 18.6, each Party(the "Indemnifying Party") will forthwith on demand indemnify the other Party (the "IndemnifiedParty")(without prejudice to any other right or remedy of the Indemnified Party under thisAgreement) against any loss or liability which.the Indemnified party incurs under the CUSC or anyBilateral Agreement or Mandatory Ancillary Services Agreement (each such term as defined withinthe CUSC) relating solely to the Connection ("Relevant CUSC Agreement"), to the extent that suchloss or liability arises directly out of any breach of this Agreement by the Indemnifying Partyprovided that:-

(a) the Indemnified Party has taken and continues to take all reasonable steps to minimise theamount of its aforesaid loss or liability;

(b) the extent of the Indemnifying Party's liability under this Clause 18.6 shall be reduced to theextent that the Indemnified Party's acts or omissions have contributed to the relevant breach;and

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(c) the Indemnified Party shall not compromise or settle any such claims, costs, proceedings ordemands without the written consent of the Indemnifying Party (which shall not beunreasonably withheld) and shall permit the Indemnifying Party to defend the same in thename of the Indemnified Party at the Indemnifying Party's expense.

18.7 Both Parties acknowledge and agree that their liability under the CUSC and any Relevant CUSCAgreement is limited as provided for in paragraph 6.12 of the CUSC (as amended from time totime). The Parties confirm that, as at the date of this Agreement, within the Relevant CUSCAgreement there are no:

(a) additional liquidated damages provisions;

(b) additional indemnities, additional payment or reimbursement provisions, additionalwarranties;

(c) additional provisions which have a similar commercial effect to those described in paragraphs(a) and/or (b) above; or

(d) additional provisions which expose the Indemnified Party to any liability in excess of £5million per incident or series of incidents or to any loss of a nature similar to that envisagedby Clause 18.4;

to those contained within the CUSC {together and separately the "Provisions"). To the extent thepreceding confirmation given by the Indemnified Party is incorrect the Indemnifying Party shall haveno liability pursuant to Clause 18.6 insofar as the liability arises from any such Provisions.

18.8 The maximum liability of the Indemnifying Party in respect of any event or related series of eventsshall not exceed that which would have applied had the provisions of paragraph 6.12 of the CUSCapplied in respect of such event or related series of events and the loss or liability of the IndemnifiedParty been limited thereby.

18.9 For the avoidance of doubt, these Clauses 18.6 to 18.9 shall apply to any amendments to theCUSC in accordance with its terms and NGET's Transmission License during the term of thisAgreement.

19. FORCE MAJEURE

19.1 Neither SHEPD nor the Customer shall be liable whether in contract, delict or otherwise for anyfailure to comply with the terms of this Offer to the extent that such failure is caused in relation tothat party by any event or circumstance which is beyond the reasonable control of that party andwhich results in or causes the failure of that party to perform any of its obligations hereunder. It isagreed that lack of funds shall not be interpreted as an event or circumstances beyond thereasonable control of the Customer.

20. PERIOD FOR ACCEPTANCE

20.1 This Offer is open for acceptance for 30 days from the date of issue.

21. TERMINATION

21.1 This Agreement shall take effect from the date of acceptance of this Offer and shall continue in force,unless terminated earlier in accordance with its terms, until energisation of the Connection.

21.2 Without prejudice to any other rights of SHEPD contained within this Agreement, where theCustomer is in breach of the Agreement and such breach is capable of being remedied and is notso remedied within seven days after written notice has been given to the Customer then SHEPDmay terminate the Agreement, and the provisions of Clause 21.7 shall apply and in such an eventthe Customer shall pay to SHEPD all sums due hereunder on receiving an invoice.

21.3 If:

(a) by 30th September 2010 the Customer has not fulfilled the Conditions Precedent detailed incondition 1.2 hereof; or,

(b) by 30th September 2011 the Customer has not completed the CDCW to the extent necessaryfor SHEPD to complete the Non-Contestable Distribution Connection Works;

(c) by 30th November 2011 the Customer's premises and/or site(s) works including, withoutlimitation, the Customer's generation facility and/or any CDCW have not been completed; or

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(d) at any time following acceptance of this Offer in the opinion of SHEPD (acting reasonably) theCustomer has not satisfactorily progressed is not satisfactorily progressing the development ofthe Customer's generation facility and/or works (including, where applicable, any CDCW) toachieve the estimated Connection date indicated in Clause 6.

then SHEPD (acting reasonably) may at any time thereafter by notice in writing forthwith terminatethe Agreement and in that event SHEPD shall have no liability to the Customer in respect thereofsave to refund any sums overpaid (if any) in respect of the works carried out to date of such notice.

21.4 At any time prior to the completion of the Connection Works, the Customer may terminate theAgreement by giving not less than 14 days written notice to SHEPD.

21.5 If:

(a) any sum due by the Customer to SHEPD shall at any time be in arrears and unpaid for morethan 28 days after a formal demand for it has been made; or

(b) the Customer becomes insolvent within the meaning of the Insolvency Act 1986 as amendedor substituted from time to time or has a receiver or administrator appointed or commences tobe wound up, other than for the purposes of reconstruction, or enters into any scheme orarrangement with one or more of its creditors; or

(c) there shall be any material breach or any persistent contravention of any of the Customer'sobligations contained in the Agreement which remain unremedied after reasonable writtennotice of such breach or contravention,

then SHEPD may at any time thereafter by notice in writing forthwith terminate the Agreement.

21.6 This Offer supersedes any Offer(s) previously issued to the Customer by SHEPD the terms of saidprevious Offer(s) hereby being confirmed as having been withdrawn.

21.7 In the event the Agreement is terminated (howsoever) pursuant to this Clause 21 or pursuant to anyother provision of this Agreement, the Customer shall remain liable and shall be obliged to pay toSHEPD:

(a) in respect of the Distribution Connection Works:-

(i) all costs, charges and expenditure (together with a reasonable allowance for profit)incurred by SHEPD up to the date of termination; and,

(ii) all costs, charges and expenditure which SHEPD is liable for as a result of thisAgreement; and,

(iii) all costs, charges and expenditure for any additional works required to render existingworks safe to the reasonable satisfaction of SHEPD; and

(b) in respect of the Transmission Construction Works (if any), all costs, charges andexpenditure which SHEPD is liable to pay NGET as a result of its Agreement with NGET forthe provision of the Transmission Construction Works.

SHEPD shall use reasonable endeavours to mitigate its liability to third parties in respect of allcosts, charges and expenditure for which it is liable as a result of the termination of this Agreement.

21.8 In the event the Agreement is terminated under this Clause 21, SHEPD may, if so requested by theCustomer and subject to requesting any necessary approval from the Authority, issue a new Offerto the Customer, on terms and conditions of SHEPD's Connection and Use of System ChargingMethodologies applicable at that time.

21.9 In the event that NGET terminates its agreement with SHEPD in relation to any TransmissionConstruction Works relevant to this Agreement, then SHEPD shall be entitled to terminate thisAgreement upon written notice to the Customer.

21.10 Where NGET terminates its agreement with SHEPD in relation to any Transmission ConstructionWorks relevant to this Agreement as a result of SHEPD breaching the terms of such agreement andClause 21.9 applies then provided such SHEPD breach is not a result of Force Majeure or as aresult of the Customer (in any way) causing SHEPD to breach, the Customer shall have no liabilityto SHEPD pursuant to the terms of Clause 21.7.

21.11 SHEPD shall be entitled to terminate this Agreement in the event Clause 1.2 (b), 4.3 (c) or Clause25.5 applies.

Page 16

21.12 In the event that NGET reimburses to SHEPD any sum originally paid by the Customer pursuant toClause 21.7 (b) then SHEPD shall make a similar reimbursement to the Customer.

21.13 The provisions of Clauses 21.7, 21.10, 21.12 and any provision hereunder regarding payment shallsurvive termination of this Agreement. .

22. NOTICE FOR WITHDRAWAL

22.1 Due to the interaction of offers for connection to the SHEPD network, SHEPD reserves the right towithdraw this Offer at any time prior to acceptance by the Customer on giving notice in writing ofsuch withdrawal to the Customer. The Offer shall be deemed to have been withdrawn on the date ofthe notice. The withdrawal of the Offer by SHEPD shall be without prejudice to the rights of theCustomer to request SHEPD to make a new offer in respect of the Connection.

23. ASSIGNMENT

23.1 Subject to this Clause 23, the Customer may only assign its rights and obligations under thisAgreement with the prior written approval of SHEPD (such approval not to be unreasonablywithheld or delayed).

23.2 The Customer warrants and undertakes that in the event of it assigning its rights and obligationsunder this Agreement in accordance with Clause 23.1 it will promptly and without deduction pay allsums (if any) owing under this Agreement up to the date of assignment.

23.3 The Customer acknowledges that SHEPD may, prior to consenting or otherwise to a proposedassignment under this Clause 23, perform credit checks on any proposed assignee to establishsuch proposed assignee's ability to discharge its payment obligations under this Agreement andmay request that such proposed assignee provide a guarantee or other form of bond, in termsacceptable to SHEPD, as a condition of any written consent.

23.4 In the event of an assignment under this Clause 23 the date(s) referred to in Clauses 6 and Clause21 will apply notwithstanding the date of any such assignment.

24. GOVERNING LAW

24.1 This Offer and any resulting Agreement shall be subject to and construed in accordance withScottish law and, subject to the terms of the Agreement, the Parties hereby submit to the exclusivejurisdiction of the Scottish Courts.

25. SECURITY AND UNDERWRITING

25.1 This Offer for Connection is conditional upon and subject to the Customer having and maintainingan Approved Credit Rating or, in the absence of such, providing and maintaining security cover orother underwriting arrangements on terms satisfactory to SHEPD (the "Security") particularly inrelation (but not limited) to the values of:

(a) the Distribution Connection Works to be carried out by SHEPD, which shall include thecharges indicated in appendix 2A or 2B (as determined by the Customer's completion of theCustomer Acceptance Form within this Offer or Agreement) and, where applicable, the valueof CAC stated in Clause 5.4 (the "Distribution Security Amount"); and

(b) any Transmission Construction Works, which (if applicable) shall include the value of theCustomer's estimated underwriting obligations indicated in Appendix 3 (the "TransmissionSecurity Amount").

The Distribution Security Amount and the Transmission Security Amount are together or individuallythe "Secured Liabilities" and are subject to amendment in accordance with the terms of thisAgreement,

The Customer shall notify SHEPD of it's credit rating upon acceptance of this Offer and shallthereafter notify SHEPD of any changes to its Credit Rating prior to energisation of the Connection.In the event the Customer does not hold an Approved Credit Rating, the Customer shall provideSecurity to cover the Secured Liabilities in one of the forms specified in Clause 25.2.

Page 17

25.2 Forms of Security

25.2.1 The Customer may provide Security in one of the following forms:

(a) a Performance Bond or Letter of Credit from a Qualified Bank for the periodic amount statedas the Secured Liabilities; or,

(b) a cash deposit in a bank account for at least the periodic amount stated as the SecuredLiabilities; or,

(c) a Performance Bond or Guarantee from a Qualified Company for the periodic amount statedas the Secured Liabilities.

All such forms of Security shall be on terms satisfactory to SHEPD in its absolute discretion.

25.3 SHEPD reserves the right to periodically revise the value of the Secured Liabilities at such times as:

25.3.1 SHEPD revises the Distribution Security Amount, in accordance with the terms of thisAgreement; and/or

25.3.2 SHEPD receives from NGET a revised estimate of the Transmission Security Amount,

25.4 SHEPD shall notify the Customer in writing of the value of the Secured Liabilities and the Customershall provide Security to the value of or the revised value of the Secured Liabilities within 10 workingdays of receiving such notification.

25.5 In the event that the Customer does not provide or maintain the required value of the SecuredLiabilities in accordance with the terms of this Clause 25, then SHEPD shall at any time thereafterbe entitled to

(a) to refuse to commence or continue work on the provision of the Connection or

(b) to terminate this Agreement in which event the provisions of Clause 21.7 shall apply.

25.6 In the event that SHEPD does hot exercise its right to terminate this Agreement pursuant to Clause25.5 (b) but exercises its rights under Clause 25.5 (a) then without prejudice to SHEPD's right toterminate at any time pursuant to Paragraph 25.5, SHEPD shall be entitled to amend thisAgreement (including, without limitation, any of its Appendices or Schedules).

25.7 The obligations to provide Security under this Clause 25 shall continue until all sums due under thisAgreement have been paid in full and shall survive termination of this Agreement.

26. VARIATIONS

The Customer and SHEPD acknowledge and agree:

(a) that no variations of this Agreement, except for those expressly provided for within the terms of thisOffer, shall be effective unless made in writing and signed by or on behalf of both parties. Eachparty shall effect any amendment required to be made to this Agreement by the Authority as a resultof a change in the Licence or any order made pursuant to the Electricity Act 1989 (as amended) oras a result of settling any of the terms hereof and the Customer hereby authorises and instructsSHEPD to make any such amendment on its behalf and undertakes not to withdraw qualify orrevoke such authority or instruction at any time.

(b) either party shall at any time be entitled to propose variations to this Agreement by notice in writingto the other party. SHEPD and the Customer shall negotiate in good faith the terms of any suchvariations but if a variation to the Agreement has not been agreed and put into effect within threemonths after it has been proposed either Party shall be entitled to refer the matter to the Authoritypursuant to SHEPD's Distribution Licence as if the variation were a new Agreement as referred to inthat Condition. The parties shall give effect to the determination of the Authority and shall enter intoany Agreement supplemental to this Agreement as shall be necessary to give effect to any variationagreed or so determined.

Page 18

26.2 At this time SHEPD is unable to provide details of the works to be carried out on the transmissionsystem to allow the Customer to connect to SHEPD's Distribution System. Where SHEPD is inreceipt of the appropriate information from NGET SHEPD shall, as soon as reasonably practicable,propose to the Customer an Agreement to Vary containing such variations to this Agreement as arenecessary to reflect the Transmission Connection Works, including but not limited to, any changesto the Distribution Connection Works, their cost or the Connection Date required to be made as aresult of the Transmission Connection Works. The Agreement to Vary shall include the Works,Cost and any other terms and conditions as SHEPD in its absolute discretion requires. If SHEPD isnot in receipt of the appropriate information from NGET shall notify the Customer accordingly.

26.3 The Customer undertakes on an annual basis to inform SHEPD of the progress which the Customeris making with its proposed project and its desired Connection Date and to confirm that itsrequirements remain unchanged.

26.4 The Agreement to Vary referred to in Clause 26,2 above shall be open for acceptance for a period ofone month from receipt. If the Customer does not accept such Agreement to Vary within one monthof receipt then SHEPD shall be entitled to terminate this Agreement

26.5 With effect from acceptance of such Agreement to Vary the provisions of this Agreement, amendedby such Agreement to vary, shall have full force and effect and the provisions of this Clause 1.1shall cease to have any further force or effect.

26.6 At any time prior to the Customer's acceptance of an Agreement to Vary issued by SHEPDpursuant to Clause 26.2 above, the Customer has the right to terminate this Agreement by writtennotice to SHEPD. This right expires with effect from the Customer's acceptance of such anAgreement to Vary,

27. WAIVER

No waiver by any party of any of the requirements hereof or of any of that party's rights hereunder shall beeffective unless given in writing and signed by or on behalf of that party and no forbearance, delay orindulgence by any party in enforcing the provisions of this Agreement shall prejudice or restrict the rights ofthat party nor shall any waiver by any party of any of the requirements hereof or any of that party's rightshereunder release any other party from full performance of that other party's obligations stated herein.

Page 19

CUSTOMER ACCEPTANCE FORM


I/ We* hereby accept for and on behalf of Horshader Community Development Ltd, SHEPD's Offer, dated11h March 2010, for the Connection on the terms and conditions contained in said Offer.

Offer for Connection

From Clause 3.8: All Distribution

Connection Works

From Clause 3.9: Non-Contestable

Distribution Works only

From Clause 3.11: Transmission

Connection Works

Payment Option * Selected

From Clause 4.5.1:

Payment Option 1

From Clause 4.5.3:

Payment Option 1

From Clause 4.6.1:

Payment Option 1

Not

Applicable

From Clause 4.5.2:

Payment Option 2

From Clause 4.5.4:

Payment Option 2

From Clause 4.6.2:

Payment Option 2

Not

Applicable

('Please indicate preference by initialling the Connection option and payment option selected)

I / We* wish to appoint Scottish and Southern Energy's Meter Operator Services * / other*

(Specify)

(*Delete and complete as required)

as the alternative meter operator for the facility.

Signature: Witness:

Print name: Print name:

Chairman/Director/Partner/Company Secretary* Witness Address:

(* Please delete and complete as required)

Date of acceptance:.

Signed as an authorised representative for and on behalf of Horshader Community DevelopmentLtd.

Note:

This Offer should be signed by the applicant personally or if the connection is requested by a company, anappropriate and authorised representative of that company. The signatory's position within the companyshould be specified together with a statement that he/she is signing on behalf of the company.

Page 20

APPENDIX 1: DISTRIBUTION CONNECTION WORKS

1 Description of the Distribution Connection Works

1.1 General Description of the Distribution Connection Works

The Distribution Connection Works required for the Connection are:

1.1.1 1.1.1 The generator connection will be provided by teeing onto the Callanish / Barvas11 kV circuit 012 at overhead line pole 249 and laying approximately 215 metres of 70mm2

Al underground cable to a GRP clad 11kV substation / switchroom building. An LVauxiliary supply will be provided by establishing an 11 kV/LV transformer on pole 249 andlaying up to 215m of LV underground cable in the same trench as the 11 kV cable to the11kV switchroom at the generating station. At Horshader Wind Generator Substation,establish an extensible 11 kV metering Ring Main Unit fitted with NVD protection andremote control facilities. On the Ring Main Unit fit an extensible 11kV circuit breaker andshort length of 11kV cable to a fully automatic, containerised STATCOM/D-VAR deviceand associated 11kV/LV transformer (the "RPCE") located on a suitable plinth provided bythe Customer adjacent to the generating station to control the steady state and transientvoltage levels on the local 11kV network, Ail cable track excavation and reinstatementworks will be provided by the customer from the base of pole 249 to the generatorsubstation and RPCE with SHEPD laying and blinding the cable. For isolation purposesan air break will be erected on pole 249. Establish the necessary communications linksand installation of SCADA facilities at the generating station to allow the 11 kV plant andequipment to be remotely monitored and controlled from SHEPD's Control Centre. Carryout project supervision, equipment specification and plant commissioning. The point ofsupply / commercial boundary will be the generator side terminals of SHEPD's 11kVmetering unit at Horshader Wind Generating Station.

1.2 Non-Contestable Distribution Connection Works

The Non-Contestable Distribution Connection Works that shall be undertaken by SHEPD are:

1.2.1 All works associated with changing pole 249, erecting 11kV air-break isolator and 11kV/LVauxiliary transformer, including the erection and connection of the pre-terminated contestable11 kV cable and associated lightning protection system.

1.2.2 The supply, installation and commissioning of the necessary telecommunications links andinterfaces to the existing SHEPD SCADA system to allow remote control and monitoring ofthe 11 kV switchgear/metering unit at Horshader Wind Generating Station.

1.2.3 A review of the voltage control settings on the Callanish 11 kV network.

1.2.4 The design and specification of all connection works.

1.2.5 Obtaining all the necessary wayleave and planning consents required for all connectionworks.

1.3 Contestable Distribution Connection Works

The Distribution Connection Works that may be undertaken by SHEPD or the Customer, dependingon the Customer's form of acceptance of the Agreement are:

1.3.1 The supply, installation, testing and commissioning of a suitably rated 11kV extensible RingMain Unit, with 11kV metering unit and extensible circuit breaker with 11kV metering unitlocated in a suitably segregated switchroom provided by the Customer at the generatingstation. The 11 kV metering RMU must be fitted with an actuator on the incoming 11 kV switchthat is suitable for remote operation and monitoring by SHEPD. The metering RMU circuitbreaker must be fitted with overcurrent, earth fault and Neutral Voltage Displacementprotection, and associated metering and protection class C.T's, V.T's and multi-core cabling.The extensible circuit breaker must be fitted with overcurrent and earth fault protection andassociated metering and protection class C.T's, V.T's and multi-core cabling.

Page 21

13.2 The supply, installation, testing and commissioning of a continuously variable, harmonicfiltered, air cooled, containerised STATCOM/D-VAR type device (RPCE) with a continuousminimum rating of + 400 kVAR (cap) to - 700 kVAr (ind), complete with a fully automaticcontrol system with sub-cycle full range response times and associated 11 kV interfacetransformer(s) located on a plinth provided by the Customer adjacent to the generatorsubstation at Horshader Wind Generating Station, including the supply, installation, jointing,testing, and commissioning of all associated, AC, DC, control and communications multicoreLV cabling systems in trenches excavated, bedded with suitable material, ducted, andpermanently reinstated by the Customer. The Customer will be responsible for meeting allcosts associated with providing a suitable modem along with the installation, maintenanceand rental of a suitable broadband enabled telecommunications link to interface with thecontrol system of the RPCE.

1.3.3 Provision of a detailed cable route survey/schedule with suitable map, full landowner/tenantinformation, a completed Environmental Impact Assessment or any other informationrequested by the relevant Planning Authority, in sufficient detail to allow SHEPD to obtain allthe necessary wayleave and planning consents for the Contestable Distribution ConnectionWorks.

1.3.4 The supply, installation, jointing, testing and commissioning of up to 215 metres of 3cx70mm2

Al XLPE HkVvUnderground cable in a trench excavated, suitably bedded and permanentlyreinstated by the Customer, between the cable terminal pole referred to in Clause 1.2.1 andincoming Ring Switch on the 11 kV metering RMU at the Generating Station Substation (withsufficient length to allow SHEPD to erect the cable terminations and lightning arresters within1.1 metres of the overhead line conductors). The 11kV cable must be installed in 125 mmBlack PVC ducts at all positions along the route that will be crossed by vehicular traffic.

1.3.5 The supply, installation, jointing, testing and commissioning of up to 15 metres of 3 core 70mm2 Al XLPE 11 kV underground cable (including suitable cable bedding material, cablemarker and protection tape) between the extensible Circuit Breaker on the 11 kV meteringRMU at the Generating Station and the DSTATCOM/D-VAR 11kV interface transformer.

1.3.6 The supply, jointing, testing and commissioning of up to 215m of 4c 95 mm2 Al, Wavecon LVunderground cable and 5m of 35sqmm Al, split concentric service cable between pole 249described in clause 1.1.1 and the auxiliary supply LV cut-out fuse unit at Horshader WindGenerating Station (with sufficient length to allow SHEPD to erect the pre-terminated cable tothe LVfuse units of the 11kV/LV transformer).

1.3.7 The supply of suitably rated 11 kV polymeric lightning arresters and earthing conductor forinstallation by SHEPD on pole 249 referred to in Clause 1.2.1.

1.3.8 The supply, installation and testing of a metering panel suitable for a meter operator to installCOP 5 import/export metering, including the supply and installation of the associatedmulticore cabling to connect to the current and voltage transformers in the 11 kV metering unitdetailed in 7.3.1 above. The location of the metering panel will be by mutual agreement.

1.3.9 Any tree and scrub clearing required over the contestable 11kV underground cable route.

1.3.10The supply, installation, testing and commissioning of a 11kV earthing systems associatedwith the cable installation and the switchgear at the generating station.

Page 22

APPENDIX 2A: PAYMENT SCHEDULES

APPENDIX 2A: ALL WORKS CONNECTION WORKS ONLY PAYMENT SCHEDULE

This is APPENDIX 2A referred to in the Offer by SHEPD to Horshader Community Development Ltdfor the Connection at Horshader Wind Generating Station, Dalbeg, Isle of Lewis:

Payment

Credit Advances

Payment 1

Payment 2

Final Paymant

Payment Date

Payments received to the date of this Offer from theCustomer

Invoice at acceptance

31st August 2010

31st August 2011

Total

Value

(Excl. VAT)

£5,000.

£144,294

£283,589

£144,295

£577,178

Notes to the Payment Schedule:

(1) All payments are due within 30 days of invoice.

(2) All sums due from the Customer must be paid in full prior to energisation of the Connection.

Page 23

APPENDIX 2B: NON-CONTESTABLE CONNECTION WORKS ONLY PAYMENT SCHEDULE

This is APPENDIX 2B referred to in the Offer by SHEPD to Horshader Community Development Ltdfor the Connection at Horshader Wind Generating Station, Dalbeg, Isle of Lewis:

Payment

Credit Advances

Payment 1

Payment 2

Final Paymant

Payment Date

Payments received to the date of this Offer from theCustomer

Invoice at acceptance

31st August 2010

31s' August 2011

Total

Value

(Excl. VAT)

£5,000

£32,973

£60,948

£32,974

£131,895

Notes to the Payment Schedule:

(1) All payments are due within 30 days of invoice.

(2) All sums due from the Customer must be paid in full prior to energisation of the Connection.

Page 24

APPENDIX 3: TRANSMISSION CONSTRUCTION WORKS

1. THE TRANSMISSION CONSTRUCTION WORKS1.1 SHEPD have in this Offer informed the Customer that certain Transmission Construction Works

require to be completed and commissioned before the Customer's generation facility can beconnected to the SHEPD Distribution network and the Connection energised.

1.2 Security may be required via a form of collateral approved by SHEPD to cover costs for TransmissionConstruction Works chargeable by NGET to SHEPD in the event the Customer terminates this Offerprior to energisation ("NGET Underwriting"). In the event of the Customer terminating this Agreement,the Customer shall be liable for the value of NGET Underwriting and charges applicable at the time oftermination.

1.3 The Customer should take due account when planning and undertaking the CDCW (if applicable) andthe generation facility works that regardless of whether SHEPD's or the Customer's works have beencompleted, the Customer's generation facility cannot be connected to the SHEPD Distributionnetwork:

1.3.1 until all appropriate agreements indicated in Clause 11,1 have been executed; and,

1.3.2 until NGET confirm, in accordance with Clauses 11.2 and 11.3 of this Agreement, that allTransmission Construction Works are completed to the extent necessary to enableenergisation.

1.4 The following items indicate the scope of the Transmission Connection and/or Infrastructure Works,the estimated charges for such works and the programme date and timescales in relation to theConnection. The Customer shall be deemed to accept the parameters below, in the event they acceptthis Offer, subject to SHEPD's rights to vary the Agreement.

2. TRANSMISSION CONNECTION WORKS COMPLETION DATECompletion Date for Transmission Connection Works: To be advised

3. SCOPE OF TRANSMISSION CONNECTION WORKS

(a.) Transmission Connection Works

To be advised

(b.) Other Distribution Works

To be advised

4. PAYMENT SCHEDULE OF CHARGES DUE FOR TRANSMISSION CONNECTION WORKS;

Payment Schedule 4.1: Transmission Connection Works

Milestone Description

Offer Acceptance

Contract Placement of Main Plant Items

Mobilisation

Commencement of Transmission Connection Installation

Completion of Transmission Connection Installation

Completion of Testing and Commissioning

SHEPD

Payment Date

To be advisedti

ii

ii

n

ii

Total Capital Contribution Charge

SHEPD

Payment Value

To be advised1!

II

II

"

II

it

Page 25

Notes to Payment Schedule 4.1:

The SHEPD Payments set out in the above are indicative and to a schedule of charges due fromSHEPD to NGET in respect of Transmission Connection Works required for the Connection.

SHEPD reserves the right to revise the charges to the Customer to reflect any changes to thecharges advised to SHEPD by NGET.

(iii) When invoiced these charges shall be subject to adjustment by a factor equal to the movement inRPI between the effective date of the relevant agreement between NGET and SHEPD and themonth immediately preceding the date of such invoice.

(iv) All sums indicated above are exclusive of VAT, which will be applied at the applicable rate at thedate of the invoice.

(v) Where applicable, SHEPD may issue invoices to the Customer at least 30 days in advance of theSHEPD Payment Date. All payments from the Customer will be due within 30 days of Invoice.

(vi) All sums due from the Customer must be paid in full prior to energisation of the Connection.

5. TRANSMISSION INFRASTRUCTURE WORKS

(a)

(b)

(c)

(d)

(e)

(f)

(g)

User TriggeredTransmissionInfrastructure Works(H1):

Wider TransmissionInfrastructure Works(H2):

NGET Works

Seven Year StatementWorks

Third Party Works

One Off Works

Additional Worksrequired in order tocomply with anyConsents in relation toany of the works inItems (a) - (f) inclusiveabove.

To be advised

To be advised

To be advised

To be advised

To be advised

To be advised

To be advised

Page 26

6. NGET UNDERWRITINGPursuant to Clause 25, NGET Underwriting shall be due and payable by the Customer immediately ontermination of this Agreement under Clause 21, if such termination occurs prior to the completion of theConnection and its commissioning. NGET Underwriting is any amount(s) payable by SHEPD to NGET ontermination of this Agreement in respect of the Transmission Construction Works required for thisConnection.

The initial forecast of the Customer's liability and charges for NGET Underwriting is indicated in Table 6.1below:

Table 6.1 : Forecast of NGET Underwriting

Period

To be advisedu

II

II

II

"

II

11

Expand as necessary

Sum (Including VAT)

Values to be advised""""11 ,11

"

Notes:

1. The above charges include (where applicable) the Costs of Advance Services Work indicatedin this Appendix 3, Item 7, Advance Services Work(s).

2. The charges specified in Table 6.1 above are stated at (to be advised) prices. When invoicedthey shall be subject to adjustment by a factor equal to the movement in RP| between theeffective date of the relevant agreement between NGET and SHEPD and the monthimmediately preceding the date of such invoice.

The above Table 6.1 may have initial only or no forecast NGET Underwriting values indicated. SHEPDshall notify the Customer of the applicable forecast NGET Underwriting values as soon as reasonablypracticable after SHEPD receives notification of such values from NGET.

7. ADVANCE SERVICES WORK(S)The Advance Services Work(s) are as follows:

(i) To be advised

Page 27

APPENDIX 4: WORKING IN PROXIMITY TO OVERHEAD LINES & UNDERGROUND CABLES

1. The Customer shall, pursuant to the Construction (Design and Management) Regulations (2007),ensure that they comply with the requirements of the following Health and Safety Executivedocuments, HSG47 "Avoiding Danger from Underground Services" and GS6 "Avoidance of Dangerfrom Overhead Electric Power Lines". These documents are available from HSE Books, PO Box1999, Sudbury, Suffolk C010 2WA (Order hotline: 01787 881165) or from http://www.hsebooks.co.uk.

2. Customers, or their contractors, may use SHEPD's freephone service on 0800 300 999 to obtaininformation on the location of SHEPD's underground cables and existing overhead lines. It would behelpful if callers provide the Post Code or the National Grid map reference of their development.

SHEPD shall use reasonable endeavours to provide further information upon request.

Page 28

APPENDIX 5: GLOSSARY OF TERMS

"Advance Services Work(s)"

"Approved Credit Rating"

"Authority"

"CDCW"

"Connection Start Date"

"CUSC"

"DCUSA"

"Distribution Code"

"EGCA"

"Engineering Charges"

"GBSO"

"GDUoS"

"Grid Code"

"Guarantee"

"ICP"

"Letter of Credit"

"Licence"

"NGET"

the works set out in this Appendix 3: Item 7, Advance Services Work(s)

any one of the following:

(a) a credit rating for long term debt of A- and A3 respectively as setby Standard and Poor's or Moody's respectively;

(b) an indicative long term private credit rating of A- and A3respectively as set by Standard and Poor's or Moody'srespectively;

(c) a short term rating by Standard and Poor's or Moody's whichcorrelates to a long term rating of A- and A3 respectively;

means the Gas and Electricity Markets Authority (GEMA), the regulatorybody for the gas and electricity industries established under Section 1 ofthe Utilities Act 2000;

means Contestable Distribution Connection Works;

means the date when the generation facility shall be liable for GDUoScharges, which shall be when all associated network connection works,any infrastructure reinforcement works and the EGCA necessary for thecommercial operation of the Customer's generation facility are in placeso that the SHEPD distribution network is capable of accepting outputfrom the generating facility to the authorised export capacity statedwithin the EGCA in respect of the premises;

means the NGET Connection and Use of System Code;

means the Distribution Connection and Use of System Agreement;

means the Distribution Code of the Licensed Distribution NetworkOperators (DNOs) of Great Britain;

means the Embedded Generation Connection Agreement, theagreement between the Customer and SHEPD governing thearrangements between the parties following energisation of theConnection;

the charges levied by NGET in relation to the Transmission ConstructionWorks under this Agreement;

means GB System Operator;

means Generator Distribution Use of System Charges;

means the Grid Code that is required to be drawn up by the GB SystemOperator and approved by the Authority;

means a guarantee in favour of SHEPD and in such form as may beacceptable to SHEPD at its absolute discretion and which is provided bya Qualified Company which holds an Approved Credit Rating;

means Independent Connections Provider;

means an unconditional irrevocable standby letter of credit, in such formas SHEPD may approve at its absolute discretion, issued in favour ofSHEPD by a Qualified Bank allowing for partial drawings and providingfor the payment to SHEPD forthwith on demand;

means the Electricity Distribution Licence granted to SHEPD under theAct;

means National Grid Electricity Transmission pic, the company whichowns and maintains the electricity transmission system in England andWales and operates the system across Great Britain in the capacity ofGB System Operator;

Page 29

"NGET Works"

"One Off Works"

"Performance Bond"

"Qualified Bank"

"Qualified Company" or"Qualifying Company"

"Seven Year StatementWorks"

"Third Party Works"

"Transmission ConnectionWorks"

"Transmission ConstructionWorks"

"TransmissionInfrastructure Works"

where applicable, those works to be undertaken by NGET and describedas such in this Agreement at Appendix 3, Item 5 (c);

where applicable, the works described as such in this Agreement atAppendix 3, Item 5 (g);

an on first demand without proof or conditions irrevocable performancebond or performance guarantee executed as a deed in a formsatisfactory to SHEPD at its absolute discretion but in any case allowingfor partial drawings and providing for the payment to SHEPD on demandforthwith and against SHEPD's delivery to the issuer thereof of a noticeof drawing of the amount demanded therein;

any United Kingdom clearing bank or any other bank which in each casehas a long term debt rating of not less than single "A" by Standard andPoor's or by IVloody's, or such other bank as SHEPD may approve andwhich shall be available for payment at a branch of the issuing bank;

means a public company or a private company within the meaning ofsection 1(3) of the Companies Act 1985 and which is either ashareholder of the Customer or any holding company of suchshareholder (the expression "holding company" having the meaningdefined in Section 1159 of the Companies Act 2006) and whichthroughout has the validity period of the Performance Bond orGuarantee holds an Approved Credit Rating;

where applicable, the works set out in the NGET Seven Year Statementand in Appendix 3 which are required to be completed before theConnection Date;

where applicable, the works specified . at Appendix 3, Item 5 (f) (ThirdParty Works);

where applicable, as defined in Appendix 3, Item 3;

means:

(a) Transmission Connection Works;

(b) Transmission Infrastructure Works;

(c) Seven Year Statement Works;

(d) One Off Works; and

(e) such additional works as are required in order to comply withany relevant Consents in relation to any of the works in (a) - (d)above;

where applicable, as defined in Appendix 3, Items 5 (a) and (b).

Page 30

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