The opinion of the court was delivered by: Hon. Harold Baer, Jr., District Judge:
OPINION, ORDER & JUDGMENT
Following a bench trial and subsequent Opinion and Order from this Court on August 8, 2005, Tractebel Energy Marketing, Inc. ("TEMI") and AEP Power Marketing, Inc., American Electric Power Company, Inc., and Ohio Power Company (collectively, "AEP") filed cross-motions for reconsideration on August 26, 2005, pursuant to Fed. R. Civ. P. 52(b) and Local Civil Rule 6.3. AEP also filed a motion for attorneys' fees pursuant to Fed. R. Civ. P. 54(d)(2). For the following reasons, AEP's motions are GRANTED in part and DENIED in part and TEMI's motion is DENIED.
The facts of this case are set forth in detail in the August 8, 2005 Opinion and Order, familiarity with which is presumed. Tractebel v. AEP, 2005 U.S. Dist. LEXIS 15972 (S.D.N.Y. Aug. 8, 2005)(Baer, J.). Briefly, on November 15, 2000, TEMI entered into a requirements contract, the Power Purchase and Sale Agreement ("PPSA"), with AEP. The PPSA stipulated that over a 20-year period of time, AEP would supply large quantities of electric power and related products and services to TEMI from a cogeneration plant to be constructed in Plaquemine, Louisiana (the "Plaquemine Facility").*fn1 This facility was to be located within an existing complex owned by the Dow Chemical Company ("Dow").
The PPSA contemplated that the parties "enter into a mutually agreeable Dispatch/Operations Coordination Protocol (the "Protocol"), not later than June 1, 2001" which would "set forth the detailed requirements for notice, forecast, scheduling, dispatch, operation, maintenance, maintenance coordination, approvals and other matters related to the operations and maintenance (including outages) of the Project and the sale and delivery of the Products." PPSA § 9.1. The Protocol never came to be. Apparently neither party was interested in its execution until after the deadline had passed, and then could not negotiate acceptable terms.
In order to cover a Termination Payment*fn2 in the event of either party's default, the parties agreed to a $50 million guaranty upon execution of the PPSA, and to provide a copy of its annual report and financial statements upon request from either party. PPSA §§ 7.1.1, 7.2.1, 7.3. If at any time a party had "reasonable grounds to believe" that the other party's Termination Payment "would exceed the value of the guaranty," it could, after giving written notice, request an increase in the guaranty in the amount of the projected Termination Payment. PPSA §§ 7.1.2, 7.2.2. The other party would then have five business days to increase its guaranty or it would be in default. Id. In April 2003, AEP requested an increase in TEMI's guaranty based on its calculation of which TEMI would owe as a Termination Payment. TEMI refused to provide any additional guaranty based on its belief that AEP's demand was unfounded and failed to meet the "reasonable grounds" language of the PPSA.
The PPSA provided that the Plaquemine Facility was to be operational by May 1, 2003, and that in case this date was not met, AEP would provide TEMI with Replacement Products,*fn3 or AEP would pay TEMI the Replacement Price.*fn4 PPSA §§ 11.4, 11.5. In Spring 2002, AEP informed TEMI that the plant would not be operational by the target date. The following year, AEP attempted to provide TEMI with Replacement Products; however, TEMI refused to accept the Replacement Products and claimed the products did not meet the specifications as defined in the PPSA. AEP billed TEMI for the Replacement Products despite TEMI's rejection.
After a bench trial, this Court held that TEMI could not prevail on its claim for breach of the implied covenant of good faith and fair dealing, and further that TEMI breached the PPSA by: (a) repudiating, and failing to provide assurances of performance pursuant to the PPSA; (b) refusing to pay for the minimum Baseload Energy, Baseload Capacity, and capacity for all other Products following Actual COD; (c) failing to increase its credit guaranty in violation of PPSA § 7.2.2; and (d) failing to make payments required by the January 15, 2003 Gas Peaking Amendment.
Accordingly, TEMI was found liable to AEP for $6,000,000 pursuant to the Gas Peaking Amendment in the PPSA, plus $116,499,287 for Replacement Products TEMI was obligated to take, including Baseload Capacity, Baseload Augmentation Capacity, Steam Peaking Capacity, and Baseload Energy, plus $493,570 for the Post-COD products, for a total of $122,992,857 plus pre-judgment interest. Finally, the Court held that AEP was not entitled to lost profit damages.
A. AEP'S CLAIM FOR GENERAL OR COMPENSATORY RATHER THAN SPECIAL OR LOST PROFIT DAMAGES
First, AEP argues that the Court erred when it characterized the Termination Payment as a request for lost profits over the 20-year length of the contract (which requires a more difficult standard be met) and AEP really had only to meet a much less demanding burden, i.e., the burden for compensatory or general damages. AEP claims it seeks only general damages, i.e., the difference between the contract value and market price.
AEP seeks damages based on the Termination Payment due AEP as a result of TEMI's breach of the PPSA.*fn5 Termination Payment damages under the PPSA § 12 are a "Settlement Amount" defined as "Losses or Gains, and Costs." "Losses" are "the present value" of "the economic loss (exclusive of Costs) resulting from the termination of this Agreement," and "Gains" are "the present value of the economic benefit . . . resulting from the termination of this "Agreement." AEP claims that its Losses will exceed its Gains by a present value of $520.6 million over the next twenty years. Because this was a calculation for damages projected over a 20-year period in the volatile energy world provided by suspect testimony, I construed them as a claim for lost profits.
"A plaintiff is seeking general damages when he tries to recover 'the value of the very performance promised.'" Schonfeld v. Hilliard, 218 F.3d 164, 175-76 (2d Cir. 2000) quoting 3 Dan B. Dobbs, Dobbs Law of Remedies § 12.2(3) (1993). General damages are usually measured by the difference between the market value for a product and the contract price. Id. On the other hand, "special" or "consequential" damages "seek to compensate a plaintiff for additional losses (other than the value of the promised performance) that are incurred as a result of the defendant's breach. The type of consequential damages most often sought is lost operating profits of a business." Id. Although the distinction between general and special contract damages is well defined, "its application to specific contracts and controversies is usually more elusive." American List Corp. v. U.S. News & World Report, Inc., 75 N.Y.2d 38 (1989). In this case, the amount of damages sought by AEP resembles most closely consequential damages, and this is so despite counsel for AEP's remark in his closing that this "is not a traditional lost profits case." (Tr. 1999-2000). AEP's claim is appropriately characterized as one for consequential damages because it is a measure of "income or ...