confidential october 7, 2009 integrating wind generation and the impact on the texas power grid mary...

Confidential

October 7, 2009

Integrating Wind Generation and the Impact on the Texas Power Grid

Mary Anne BrelinskyVice President, Texas Power

2

EDF Group and EDF Trading Overview

EDF Trading is a leader in the international wholesale energy markets.

EDF Trading has a pivotal role at the heart of the worldwide EDF Group. As EDF Group’s interface to the wholesale energy markets, EDFT uses large scale arbitrage and trading to optimize the energy positions and assets owned by EDF group.

EDFT sources, supplies, transports, stores, blends and converts physical commodities as well as trade in the financial markets.

An entrepreneurial culture, strong business platform and high caliber people combine to create a powerful business model that has driven EDF Trading to its leading position in Europe today.

EDF Group is Europe’s largest electricity producer.

EDF Group is Europe’s largest electricity supplier, contributing to the supply of energy and related services to more than 38 million customers.

EDF Group is involved in all areas of the energy value chain including generation, transmission, distribution, supply and trading, and is increasingly active in Europe’s gas markets.

EDF operates 66 Nuclear Power Stations worldwide (including British Energy).

Investment Grade Credit, EDF shares trade on the Euronext Paris index (EDF)

€64 BILLION 2008 sales

€23 BILLION in shareholder’s equity

€7.9 BILLIONIn 2008 operating profit

85% owned by the French government

164,000 Employees worldwide

126.7 GW installed generation capacity

€1 BILLION 2008 Operating profit

€1.6 BILLION in shareholder’s equity

700 Employees

100% owned by EDF Group S.A.

A3Moody’s Credit Rating

London Headquartered

3

Eagle Energy, a subsidiary of EDF Trading.

Wholesale Gas Trading and Supply:One of the top gas marketers in North America, marketing 4.4 Bcf a day of natural gas800,000 MMBtu/d of firm transportation in 40 pipelines primarily in the Eastern USArrangements for storage of gas in the Mid-Con, Mid-Atlantic, Gulf Coast and West regions with 5+ year term capacity on ANR, CGT, Centerpoint, and Kern River

Wholesale Power Trading and Supply:Market approximately 10,000 MW of third-party owned power generating assets in the US, dispatching ~8% of ERCOTOptimize the fleet via Day-ahead, intra-day, monthly, fixed and index productsWide regional presence: SERC, VACAR, SPP, FRCC, MISO, PJM, and ERCOT

Coal Offices in Denver and Baltimore

180 Employees in the United States and Canada

Eagle Energy Partners Overview

Gas Asset

Coal

Gas Transport

Power Asset

4

Eagle’s Power Footprint by Fuel Mix of Clients

West

North

South Houston

West

North

South Houston

West

North

South HoustonNorth

Houston

South

West

Zones

Power Regions

PJM

MISO

WEST

SERC

Portland

Calgary

Denver

Combined Cycle Gas

Legend

System OptimizationGas Peaking

CoalPetroleum Coke

Solar

650mw

150mw

550mw

188mw

2500mw

16mw

Demand Response

100mw

708mw

900mw

Baltimore

40mw

212mw

Load Served

136mw

648mw

290mw 212mw250mw 830mw

80mw

550mw

Wind

180mw

685mw

53mw

680mw

500mw

Atlanta

PittsburghChicago

San Francisco

EDFTNA Office600mwEDFTNA HQ

5

ERCOT Market Overview

6

Important Acronyms and Terms

CREZ – Competitive Renewable Energy Zone - an area where wind generation facilities will be installed throughout West Texas and the Panhandle and from which transmission facilities will be built to other areas of the state to deliver mostly renewable power to end-use consumers in the most beneficial and cost-effective manner.

ERCOT – Electric Reliability Council of Texas - certified by the Public Utility Commission of Texas as the Independent System Operator (ISO)

MCPC - Market Clearing Price for Capacity - highest price for a Settlement Interval for Ancillary Service capacity awarded for each of the Ancillary Services procured by ERCOT

MCPE - Market Clearing Price for Energy - highest price associated with a Congestion Zone for a Settlement Interval for Balancing Energy deployed

PGC - Power Generation Company

QSE – Qualified Scheduling Entity - Market Participant that is qualified by ERCOT to submit Balanced Schedules and Ancillary Services bids and settle payments with ERCOT

REP – Retail Electric Provider - A person or group that sells electric energy to retail Customers in ERCOT

TDSP - Transmission and Distribution Service Provider - Owns or operates for compensation in this state equipment or Facilities to transmit and/or distribute electricity, and whose rates for Transmission Service, distribution service, or both is set by a Governmental Authority

WGR - Wind-powered Generation Resource - A Generation Resource that is powered by wind.

7

ERCOT in the National Picture

ASCC - Alaska Systems Coordinating CouncilERCOT - Electric Reliability Council of TexasFRCC - Florida Reliability Coordinating CouncilMRO - Midwest Reliability Organization NPCC - Northeast Power Coordinating CouncilRFC - ReliabilityFirst Corp.SERC - Southeastern Electric Reliability

Council. SPP - Southwest Power PoolWSCC - Western Systems Coordinating Council

North American Electric Reliability Council Regions

8

Texas Pre-Deregulation: 10 Control Areas

TNMP

CSW

LCRA

HLP

CPS

TXU

TXU

PUB

STEC

TMPP

AE

TNMP

CSW

LCRA

HLP

CPS

TXU

TXU

PUB

STEC

TMPP

AE

Former ERCOT Control Areas

HLP Houston Lighting and PowerTU Texas UtilitiesLCRA Lower Colorado River Authority STEC South Texas Electric CoopPUB Public Utilities BoardTMPP Texas Municipal Power PoolTNMP Texas New Mexico PowerCPS City Public ServiceCSW Central South WestAE Austin Energy

9

Senate Bill 7 and the Renewable Energy Mandate

On January 1, 2002, retail competition in Texas was initiated for all customers of investor-owned utilities in ERCOT

Prior to Senate Bill 7 (SB 7), all retail electric customers were served by utilities, electric cooperatives, or municipally owned utilities and few customers had a choice of where or from whom they bought their power

Prices for the production and sale of electricity to both wholesale and retail customers are now dictated by market forces

Customers with peak demand of one megawatt or less had a regulated “price to beat”, provided by the REP affiliated with the traditional utility service area until 2007

Retail prices are not subject to Commission regulation or oversight, and customers are free to choose among the variety of options available from competitors in the marketplace

Transmission and distribution facilities remain regulated by the Commission

Renewable Energy Mandates encouraged the construction and operation of new renewable energy projects in Texas to reduce air pollution associated with the generation of electricity using fossil fuels

10

Texas Uses a Stakeholder Process

Rules are made using a “Stakeholder” process

Changes to market rules are made and implemented by elected stakeholders

Market participants fall into the following categories:

– Independent Power Marketers

– Independent Generators

– Municipal Utilities

– Electric Cooperatives and River Authorities

– Consumers

– Independent REPs

– Investor Owned Utility

11

ERCOT’s Role In Texas

ERCOT’s primary role is to ensure Reliability; they do this by:– Resource capacity planning

– Real-time transmission management

– Procure balancing energy

– Issue deployment instructions to units, as needed

– ERCOT is similar to an Air Traffic Controller

ERCOT’s main roles include:

1. Ensures the grid can accommodate scheduled energy transfers

2. Maintain grid reliability

3. Oversees retail transactions

12

ERCOT Market Participant Structure

Eagle QSE

SCADA Data Customer Meter Reads

Loss Information

TDSP

Other QSEs

Balanced SchedulesAncillary Service Bids

Load Schedules

Client Generation

Resource SchedulesResource Bids

Other REPs

Other PGCs

Client Load Resources

ResidentialCustomers

Commercial & IndustrialCustomers

Eagle REPWind Only QSE

Client Wind Resources

13

Qualified Scheduling Entity (QSE)

QSEs are market participants that are qualified by ERCOT to:

– Submit Balanced Schedules to ERCOT– Submit Ancillary Services Bids and

Schedules to ERCOT– Clear all financial settlement with ERCOT– Staff a 7x24 Real Time Desk to handle

operational changes– All Resources and Load Serving Entities

(LSEs) must be represented by a QSE– To provide ancillary services in ERCOT a

QSE must be a Level 4 certified QSE

14

Retail Electric Provider (REP)

Retail Electric Power providers serve all end use consumers of electricity in ERCOT

To serve load in ERCOT a REP must know:

– ESID (Electric Service Identifier of the Meter) and address of Facility

– ERCOT Congestion zone– Weather zone– Meter type (scalar or IDR)– Load (historical consumption pattern)– Transmission Distribution Service Provider– Contract for the wholesale supply of electricity– Contract for the wholesale supply of Ancillary Services– Financially settle with their QSE

Eagle Industrial Power Eagle Industrial Power ServicesServices

15

Power to Choose Website

http://www.powertochoose.org/

16

ERCOT Transmission Grid

The ERCOT Grid

$30 Billion Market

6 million customers with right to choose

72,820 MW generation

Peak Load of 63,453 MW set on July 13, 2009

8,000 miles of 345 kV lines

16,000 miles of 138 kV lines

Over 38,000 miles of total transmission lines, over 1.5 times the circumference of the earth!!!

17

2009 ERCOT Congestion Zones

Wholesale Market: Zonal Design Bilateral Market Zones are defined annually

Congestion: The situation that exists when scheduled power flows, when netted, are projected to exceed the capability of a Transmission element or set of elements.

Constraint: A transmission element or group of elements ratings that limit the free flow of energy. Constraints are typically thermal, voltage stability, and angular stability limitations. These constraints are the result of defined contingencies such as the trip of a generating unit or transmission circuit.

Commercially Significant Constraint (CSC): A constraint in the ERCOT Transmission Grid that is found to limit the free flow of energy a commercially significant degree. Solutions to the congestion are solved competitively.

18

Congestion in ERCOT

Two types of congestion:

Inter-zonal congestion– Determined by CSCs

(commercially significant constraints determined by ERCOT annually)

– Occurs between congestion zones– Resolved using Zonal Balancing

Energy (Merit Order)

Intra-zonal congestion– Occurs within a congestion zone– Cannot be resolved with Zonal

balancing energy– Unit-specific deployments and

OOM Energy are utilized– Cost is uplifted system wide to all

loads

NorthNorthWestWest

SouthSouthHoustonHouston

19

MCPE and MCPC Prices

MCPCs

MCPEs

20

Three Primary ERCOT Markets

Day Ahead Bilateral Markets

Day Ahead Ancillary Markets

Balancing Energy Markets

ERCOT uses three primary markets to manage generation, forecasted load, and the intraday volatility in system frequency:

Primarily over the counter energy hedges between generation, trading, and load counterparties

ERCOT purchased capacity used to maintain system reliability

Spot energy prices for the imbalance between scheduled generation and forecasted

load.

21

ERCOT’s Bilateral Market

In the ERCOT Bilateral Market:

Day Ahead Traders determine their position for tomorrow by evaluating load and generation resources for all participants in their Qualified Scheduling Entity (QSE)

If their aggregated portfolio position for tomorrow is long, short, or un-optimized the trader will step out into the bilateral market

Traders use ICE, Power Brokers, and direct contacts at other Power Marketers to facilitate trading

Power can be sold by Congestion Zone

Trades typically occur in 50 MW blocks:

– On-peak – Monday through Friday HE 7 through HE 22 (the 5x16)

– Weekend – Saturday and Sunday HE 7 through HE 22 (the 2x16)– Off-peak – Everyday HE 1-6 and HE 23-24 (the 7x8)

Day Ahead Bilateral Markets

22

Day Ahead Ancillary Services Market

What are Ancillary Services (“AS”)?

According to ERCOT, “Ancillary Services are those services necessary to support the transmission of energy from resources to loads while maintaining reliable operation of transmission provider’s transmission systems in accordance with Good Utility Practice.”

Ancillary Service Products receive a Capacity Payment!

The four primary Day Ahead Ancillary Service Products are:

– Regulation Up (URS): Controls the power output in response to a change in system frequency, signal is sent every 2 seconds, 24 hours a day; all signals from ERCOT cause an increase in generation from baseline

– Regulation Down (DRS): Same as Regulation Up but all signals from ERCOT cause a decrease in generation from baseline

– Responsive Reserve (RRS): Provided by unloaded generation facilities on line, interruptible loads controlled by high set under-frequency relays, or DC tie response that stops frequency decay; RRS is usually a short term deployment

– Non-spinning Reserve (NSRS): Utilizes the portion of off-line capacity capable of being synchronized and ramped (or interrupted) to a specified output level within 30 minutes and is capable of running at specified output level for 1 hour

Day Ahead Ancillary Markets

23

ERCOT’s Balancing Energy Market

Balancing Energy is a “thin” pool of energy that allows ERCOT to acquire additional resources to correct imbalances between generation and load

ERCOT looks at the balance between supply and demand approximately 30 minutes prior to each 15-minute interval

ERCOT will deploy "balancing energy" on behalf of the market, ERCOT may increase or decrease generation

During the financial settlement process, ERCOT determines which REPs and generators incorrectly forecasted their schedule and charges them imbalance costs

Schedules can be changed by QSEs up to an hour before the operating hour

The Balancing Energy Market does NOT provide Capacity Payments

Balancing Energy market prices change every 15 minutes and you have different prices per zone when congestion occurs

Balancing Energy Markets

24

How has Wind Impacted ERCOT?

25

So what happens when you add 9,000 MWs of Wind Generation to a 70,000 MW system?

Challenges posed by wind power include:Forecasting of output in term, daily, and real time is complex

Variability in the output of the facilities require additional ancillary services to manage fluctuations

Large wind related ramp events require complimentary output from traditional generation facilities

Wind generators do not currently provide primary frequency response

Benefits created by wind generation include:Lower spot market costs

Positive environmental impact

Job creation

26

Wind Energy in Texas

Wind Capacity Installed by Year

(as of August 31, 2009)

8,3

35

8,3

35

8,3

35

1,385

2,875

116 116

1,173977816

1,854

4,785

8,005

8,3

35

8,3

35

2,6

11

2,6

11

2,0

60

1,2

57

655

0

2,000

4,000

6,000

8,000

10,000

12,000

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Year

MW

Cumulative Planned (Signed Interconnection Agreement)

Cumulative MW Installed

8,990

9,592

10,395

10,946 10,946

System Planning Division Monthly Status Report August 2009

27

ERCOT Generation Stack by Fuel Type

ERCOT Installed Capacity Generation Stack with Forecasted Load

-2,5005,0007,500

10,00012,50015,00017,50020,00022,50025,00027,50030,00032,50035,00037,50040,00042,50045,00047,50050,00052,50055,00057,50060,00062,50065,00067,50070,00072,50075,00077,50080,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Hour of Day

MW

Cap

acit

y

NG-CC

PetroleumCoke

COAL

WIND

HYDRO-HY

NUKE

ExpectedLoad Forecast

28

ERCOT Generation Stack by Fuel Type

ERCOT Generation Stack with Forecasted Wind and Forecasted Load

-2,5005,0007,500

10,00012,50015,00017,50020,00022,50025,00027,50030,00032,50035,00037,50040,00042,50045,00047,50050,00052,50055,00057,50060,00062,50065,00067,50070,00072,50075,00077,50080,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Hour of Day

MW

Cap

acit

y

NG-CC

PetroleumCoke

COAL

WIND

HYDRO-HY

NUKE

ExpectedLoad Forecast

29

Long Term Impact of Wind on Spot Power Prices

Houston Zone vs. West Zone Monthly 7x24 MCPE

$-

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

$140.00

Jan 0

6F

eb 0

6M

ar

06

Apr

06

May 0

6Jun 0

6

Jul 0

6A

ug 0

6S

ep 0

6O

ct 06

Nov 0

6D

ec 0

6Jan 0

7F

eb 0

7M

ar

07

Apr

07

May 0

7

Jun 0

7Jul 0

7A

ug 0

7S

ep 0

7O

ct 07

Nov 0

7D

ec 0

7Jan 0

8F

eb 0

8M

ar

08

Apr

08

May 0

8Jun 0

8Jul 0

8A

ug 0

8S

ep 0

8O

ct 08

Nov 0

8D

ec 0

8Jan 0

9F

eb 0

9M

ar

09

Apr

09

May 0

9Jun 0

9Jul 0

9A

ug 0

9S

ep 0

9

MC

PE

in

$/M

Wh

r

Houston Zone

West Zone

30

Intraday Volatility Caused by Wind on the West Zone MCPE

West Zone MCPE PricesMarch 2009

($50.00)

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$300.00

$350.00

$400.00

$450.00

$500.00

03/0

1/2

009

03/0

2/2

009

03/0

3/2

009

03/0

4/2

009

03/0

6/2

009

03/0

7/2

009

03/0

8/2

009

03/0

9/2

009

03/1

1/2

009

03/1

2/2

009

03/1

3/2

009

03/1

4/2

009

03/1

6/2

009

03/1

7/2

009

03/1

8/2

009

03/1

9/2

009

03/2

1/2

009

03/2

2/2

009

03/2

3/2

009

03/2

4/2

009

03/2

6/2

009

03/2

7/2

009

03/2

8/2

009

03/3

0/2

009

03/3

1/2

009

31

Fuel Type During System Peak

-2,5005,0007,500

10,00012,50015,00017,50020,00022,50025,00027,50030,00032,50035,00037,50040,00042,50045,00047,50050,00052,50055,00057,50060,00062,50065,00067,50070,00072,50075,00077,50080,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

32

How does ERCOT Forecast the Wind?

Two forecasts are produced for each Wind Resource:

– Wind Generation Resource Production Potential (WGRPP) is an 80% probability of exceedence forecast

– Short-Term Wind Power Forecast (STWPF) is the most likely or 50% probability of exceedence forecast

– Each hour a new forecast is created for the next 48 hours

– Aggregate forecasts are also created and sent to ERCOT

Inputs into the ERCOT Wind Forecaster:– WGR site-specific MW and meteorological data

– Outage scheduler data

– Registration data

– Other (i.e. National or regional weather service data)

Aggregate Wind Power Forecasts:Red = STWPF, Green = WGRPP

Key Challenges to Reliability with Increased Wind Penetration, PUCT Project 37339 Workshop 8/20/09Dan Woodfin, Director, System Planning and John Dumas, Manager, Operations Planning

33

Chart to the right shows an example of forecasted expected Wind output versus actual output

On May 15, 2009 at 3:15 PM ERCOT models forecasted 6,000 MWs of wind during the off peak hours

Off peak wind output topped off at 3,000 MWs during the off peak hours

Large forecast error was caused by the over estimate of the power production as a cold front approached and passed through the region

Weather models overestimated the southerly wind speeds ahead of the front

To cover the shortage of wind output traditional generation is deployed by ERCOT

ERCOT Forecast and Observed Generation on 5/16

0

1000

2000

3000

4000

5000

6000

7000

8000

1 3 5 7 9 11 13 15 17 19 21 23

Hour of the Day (CDT)

Ge

ne

rati

on

(M

W)

Observed Forecasted


Forecast Error Happens

MCPE Prices for May 16, 2009for Houston and West Zones

($50.00)

($25.00)

$0.00

$25.00

$50.00

$75.00

$100.00

$125.00

$150.00

$175.00

$200.00

$225.00

$250.00

$275.00

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Houston Zone

West Zone

34

Sometimes You Can Have Too Much of a Good Thing

34

Wind Output/Curtailments vs. Day Ahead Resource Plans for May 2009


35

Managing the Wind Ramp

ERCOT utilizes an “ERCOT Large Ramp Alert System” (ELRAS) that employs the same data that is provided for the wind power forecasts.

ELRAS includes the following:– An estimation of the probability of a

defined ramp event (i.e. 1000 MW up ramp in a hour) beginning in a particular interval

– Information regarding the weather event which is most likely to cause the ramping event (i.e. a cold front)

– Additional attributes for each predicted ramp event including most likely start time, duration and maximum ramp rate

– Time variant graphics to provide additional situational awareness

ELRAS focuses on the next 6 hours into the future


36

Causes of the Sixty Largest ERCOT Wind Power Ramps January 1 to April 20, 2009

Coid Front - Up Ramp

Low Level Jet - Up Ramp

Pressure Gradient Change - UpRamp

Daytime Mixing - Up Ramp

Dry Line - Up Ramp

Pressure Gradient Change - BehindCold Front - Down Ramp

Pressure Gradient Change - HighPressure - Down Ramp

Pressure Gradient Change - Other -Down Ramp

Nocturnal Stabilization - DownRamp

Low Level Jet - Down Ramp

Down Ramps Up Ramps

Ramp events have different meteorological causes which makes tracking and predicting them complex

Managing the Wind Ramp (cont.)


37

Can we have our cake and eat it too?

38

Interconnection Requests for Generation

0

20,000

40,000

60,000

80,000

100,000

120,000

Jan-0

6

Feb-0

6

Mar-

06

Apr-

06

May-0

6

Jun-0

6

Jul-06

Aug-0

6

Sep-0

6

Oct-

06

Nov-0

6

Dec-0

6

Jan-0

7

Feb-0

7

Mar-

07

Apr-

07

May-0

7

Jun-0

7

Jul-07

Aug-0

7

Sep-0

7

Oct-

07

Nov-0

7

Dec-0

7

Jan-0

8

Feb-0

8

Mar-

08

Apr-

08

May-0

8

Jun-0

8

Jul-08

Aug-0

8

Sep-0

8

Oct-

08

Nov-0

8

Dec-0

8

Jan-0

9

Feb-0

9

Mar-

09

Apr-

09

May-0

9

Jun-0

9

Jul-09

Aug-0

9

MW

Cap

acit

y

0

50

100

150

200

250

300

Pro

ject

Co

un

t

MW Natural Gas MW Nuclear MW CoalMW Wind MW Solar * MW Biomass *MW Other Total # Projects # Projects Cancelled

* Prior to September 2008, Category "Other" included "Solar" and "Biomass" Projects in all phases of interconnection study are reflected in this graph Project cancellation tracking by month began in March 2008

39

Wind Installed Capacity and Interconnection Requests

ERCOT is currently tracking 230 active generation interconnection requests totaling over 83,000 MW

ERCOT is currently managing almost 48,000 MWs of wind generation interconnection requests

Transmission Projects energized in 2009 total about $416 million

To find the list of projects go to the ERCOT web at:

www.ercot.com/content/meetings/ros/keydocs/2009/0910/10._August_2009__ROS_final.pdf

40

Ancillary Service Methodology

Wind Ancillary Services study was performed by General Electric consulting group with input from ERCOT staff

Study looked at the need for additional or modified ancillary services to meet reliability requirements given the large increase in wind generation in ERCOT

Study found that ERCOT needed to implement state-of-the-art wind power production forecast to protect against variability of the wind

The study predicted that with 15,000 MWs of wind installed, the amount of Regulation would go up by 23%. ERCOT experience has shown that the incremental Regulation required is greater.

– ERCOT procures Regulation to ensure that reserves are sufficient to cover 98.8% of the intervals

– Calculated based on previous 30 days and same month last year– Accounts for the expected increase in installed Wind Generation for the upcoming

month – Provision to increase regulation requirements if the last 30 day average CPS1

score falls below 100

41

CREZ Transmission Solution

The Public Utility Commission of Texas (PUCT), under Docket 33672, designed five zones as the Competitive Renewable Energy Zones (CREZs).

The PUCT asked ERCOT to develop transmission plans that would cost-effectively collect wind from the five CREZ areas and move it to load centers.

ERCOT evaluated four scenarios and in January of 2009 the PUC approved Scenario 2.

DFW

SA/AUS

5,600 MWs

10,300 MW

2,600 MW

42

Competitive Renewable Energy Zones (CREZ)

43

Actual Summer Week Generation by Fuel Type

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Nuclear Coal CombCycle GasSteam PrivateGas GasTurbine Wind Other

Sunday 07/12/09

Monday 07/13/09

Tuesday 07/14/09

Wednesday 07/15/09

Thursday 07/16/09

Friday 07/17/09

Saturday 07/18/09

44

Actual Spring Week Generation by Fuel Type

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

Nuclear Coal CombCycle GasSteam PrivateGas GasTurbine Wind Other

Sunday 04/19/09

Monday 04/20/09

Tuesday 04/21/09

Wednesday 04/22/09

Thursday 04/23/09

Friday 04/24/09

Saturday 04/25/09

45

Forecasted 2013 High Wind Week Generation by Fuel Type

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

Nuke Coal Combined Cycle Gas Steam Private Gas Turbine Wind Other

Monday 03/11/13

Tuesday 03/12/13

Wednesday 03/13/13

Thursday 03/14/13

Friday 03/15/13

Saturday 03/16/13

Sunday 03/17/13

46

The Costs and Benefits of CREZ

Estimated cost of the CREZ project is over $4.93 B – Cost to average rate payer in Texas is $4/month

Economic and environmental benefits are significant– Roughly $1.2 B in royalty payments to landowners– Estimated $3.32 B in tax payments to state and local governments

over 10 years– Creation of construction & permanent jobs ($900 MM)

– Reduction of 193 MM tons of CO2 per year

– Reduction of 93 k tons of NOx per year

– Reduction of 17 B gallons of H2O usage per year

CREZ will add 2,334 miles of new 345-kV transmission lines capable of handling 18,456 MWs (11,553 MWs of incremental capacity above the 6,900 MWs of base case generation)Utilities participating include AEP Texas Central, AEP Texas North, Electric Transmission Texas, LCRA, Oncor, Sharyland Utilities, South Texas Electric Cooperative, and Texas-New Mexico Power CompanyAs a fast track project, completion is targeted for 2013

47

Questions?

confidential october 7, 2009 integrating wind generation and the impact on the texas power grid mary...

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