Advanced Metering Systems Update CenterPoint Energy Houston Electric

1. Advanced Metering Systems UpdateCenterPoint Energy Houston Electric October, 2009

2. CenterPoint Energy – Houston • Chartered in 1882 • 5,000 square-mile service area • 2.1 million electric metered customers • 73.6 billion kilowatt hours delivered yearly for about 60 certified competitive retailers • Transmission and Distribution System • 3,640 miles of transmission lines • 41,913 miles of distribution lines • 225 substations • Advanced Metering System deployment underway: • 90,000+ Itron OpenWay meters (2.0/2.0) installed to-date • 99.75% register read rate • 80 to 99.0+% interval (15 minute) read rate • 100% Connect/disconnect capable (200 amp, 1 phase) • 10,600+ connect/disconnects since 7/21/09 • 5 year project – 2.4 million electric

3. Major AMS Touch Points Intelligent Grid Self Healing Grid – Enhanced Reliability Operations Energy Independence Smart Meter REP / Customers Distribution Substations Transmission Conventional Renewable Generation with Storage In Home Automation & PHEV’s Mid Grid Automation “Clean Energy” Power Sources

4. AMS Roadmap • Event Avoidance • Predictive Failure System • Advanced Multi Source Data Analysis • Grid Event Diagnostics • Grid Automation will: • Improve system reliability • Optimize business processes • Leverage technology to achieve • operational efficiencies • Improve asset utilization • Prolong life of aging infrastructure • Improve customer satisfaction • Self-Healing Grid • Improved Asset Mgmt / Visibility • Real time Grid Condition Monitoring • Automated Grid switching, • Meter as a Sensor • Transformer Load Mgmt • Condition Based Crew Dispatching • Grid Event Detection and Location • Advanced Meter System (AMS) • Enables time and peak based pricing • Automated Meter reading and alerts • Enables prepay meter option • Remote Meter Connect / Disconnect • Enables demand management • Enables energy conservation • Enables Home Area Network CNP’s smart grid initiative focused on installing the smart metering system first to allow consumers to capture the benefits more rapidly. 4

5. Major AMS Program Components In December, 2008, CenterPoint Energy (CNP) obtained PUCT approval for full smart meter deployment (2.4m meters over 5yr period). • Meter Data Management System - eMeter’s Energy IP • Wireless WAN Communications Network System – GE’s Mercury 3650 WiMax Radio • End to End Systems Management and Operations – IBM’s Tivoli Suite of Products • Smart Electric Meter – Itron OpenWay meters • User Portals – IBM’s WebSphere Portal Software • Texas Common Data Repository - Joint effort with Texas Electric Utilities • Home Area Network (HAN) – Wireless system incorporated into meter using Zigbee Smart Energy Profile

6. AMS Communications • AMS Communications Network: • Consist of radio/microwave tower based GE WiMAX access points spread throughout CNP’s electric service area that communicate to Cell Relays and provides a high speed/bandwidth communications path back to the CNP Backbone (see GE WiMAX Radio Network) • The Cell Relays then communicate with many meters that form a mesh network (see Itron Cell Relay Network) Year End Year-to-Date 2009 2010 2011 2012 2013 GE WiMAX Tower Deployment Plan Cell Relay Deployment Plan GE’s WiMAX Radio tower based Access Points will communicate to Itron’s Cell Relays at a ratio of approximately 70:1 Itron’sOpenWay Meters will form a mesh network that will communicate to Itron’s Cell Relays at a ratio of approximately 400:1

7. Typical AMS Communications Setup Antenna AC Power Plugs Cell Relay WiMax Radio

8. AMS Functionality and HAN • Functionality (non-inclusive) – Texas Common Data Repository and Portal • 15 Minute usage data • Remote connect / disconnect (connect within one hour) • Real time meter interrogation for power availability and register read • Tamper notification • Full security for multiple access • Web access to usage data • Meter reports outage and restoration • Enables real time communication between AMS meters and HAN devices • Distributed Generation/Renewables metering • After 2010, HAN support for: (Note: Future HAN services and products supported by AMS will be greatly influenced by future standards development and regulatory direction.) • pre-payment services • PHEV monitoring & controls • Support for TOU, CPP and dynamic pricing • Improved HAN device control • HAN messaging over AMS network • Customer HAN device access permission/authorization • HAN device performance evaluation

9. Home Area Network (HAN) Consumers ZigBee Programmable Communicating Retail Energy Providers Thermostat HAN Traffic (Limit Five Devices) Internet ZigBee In Home Device Monitor (& Control) Network OpenWay Meter CenterPoint Energy • AMS HAN offers additional load control options: • Non-essential vs. comfort appliance control • Improved customer usage awareness: • Time sensitive rate making • Load shaping • Energy conservation • Load Control • Pool Pumps • PHEV • Electric Water Heaters • Electric Heaters • Washer / Dryer

10. Home Area Network (HAN) Consumers Consumers REP’s Wireless Zigbee Wireless Home Area Network Devices Broadband Connection CNP Consumer / REP Low Med High Broadband Communication, Interface & Device Provided by Consumer or REP Data Traffic Basic HAN Device Provided by REP / Consumer - operates on CNP Communication Complex High End HAN Utility APPS (DSM, Basic Device Controls, Near Real Time Consumption Feedback…) Complexity of HAN Devices

11. The value of an integrated, remote service switch can be realized in several areas

12. AMS Field Overview Wind Generation HAN Metering Communications Back Office Systems Texas Common Portal Internet Web Services High Voltage Lines FIBER LINK Medium Voltage Line Wireless Tower Cell Relay RF Wireless Repeater Residential Consumer Local Home Area Network Smart Meter