Market Participant Opinions on ERCOT Staff's Role in Developing Market Rules

1. Prepared by Opinion Dynamics Corporation May 2004

2. Response Rate429 completed surveys from a sample of 1,157 Market Participants (37%)

3. By Market Participant Firm Type Response Rate

4. Survey Approach: 10 point scale • Many questions based on a 10 point scale: 1-3 = very negative response, 8-10 = very positive response. • Mean responses will trend toward the middle of a 10 point scale – only those with passionate opinion are likely to provide a rating in top or bottom 3. • In general, mean responses of 6.5 or above are favorable ratings, 7.5 and above are extremely positive responses.

5. Background and ContextMarket Participant Opinions RegardingERCOT Staff’s Role In Developing Market Rules Findings

6. Background and ContextMarket Participants’ Understanding of ERCOT’s Committee Structure Findings

7. Background and ContextMarket Participants’ Understanding of ERCOT’s Committee Structure (cont.) Findings

8. Color Key

9. Overview of Perceived Strengths • Performance of ERCOT staff, officers and directors • Personalized contact with Market Participants-- particularly CSR contact • Timeliness and accuracy of data • Providing effective training Findings

10. ERCOT Staff Performance: Corporate Objectives (10 point scale, means shown) Nondiscriminatory access to transmission/ distribution Ensuring Reliability/Adequacy of Grid Accurate accounting of electric production & delivery Timely information about customer’s choice of REP Findings

11. ERCOT Staff Performance (10 point scale, means shown) Attitude Industry expertise Overall Performance Responsiveness to Market Participants Management of ERCOT organization(Officers & Directors only) Consistency Findings

12. ERCOT Staff Performance: CSRs (10 point scale, means shown) Attitude/Willingness to resolve problem Direction of inquiries Accessibility Overall expectations Response accuracy Timely response Knowledge/ Industry Expertise Findings

13. ERCOT Staff Performance: Functional Areas(10 point scale, means shown) Market Participant Registration Systems Testing Retail Transaction Processing Scheduling Grid Operations Settlements and Billing Settlements Dispute Resolution Findings

14. Communications (10 point scale, means shown) Written Communication Amount of information Verbal Communication Clarity of ERCOT Staff’s Messages Timeliness Findings

15. Communications: Functional Areas(10 point scale, means shown) Asset Registration Systems Changes Progress on Market Projects Bidding Systems Planning Findings

16. Timeliness & Accuracy of Data(10 point scale, means shown) Metered Data Settlements Bill Transmission Congestion Rights Renewable Energy Credits Data Extracts Findings

17. Effectiveness of Training(10 point scale, means shown)

18. Overview of Areas for Improvement • Portal reliability • Spending priorities • Systems and tools for communicating with the market • Website navigation • EMMS • IT Technical Helpdesk • Functional Performance • congestion management • data extracts • settlement dispute resolution Findings

19. ERCOT PortalLevel of Agreement with Statements About ERCOT IT Systems/Staff The Portal is effective The Portal is reliable Findings

20. ERCOT Spending Practices (10 point scale, means shown) Spending Funds Equitably Spending Funds on Things that are Important to Your Company Spending Funds Cost Effectively Findings

21. Communications: Room for Improvement(10 point scale, means shown) Communicating… Impacts of PRRs When behind schedule for systems changes Grid ops decisions When systems are down Findings

22. Communications: Room for Improvement(10 point scale, means shown) Navigation of the Web Site Usefulness of IT Help Desk Understanding EMMS Findings

23. ERCOT Functional Performance (10 point scale, means shown) Providing Data Extracts with Necessary Content Addressing Congestion Management issues Timely and Effective Implementation of Systems Changes Timely Resolution of Settlements Disputes Findings

24. Conclusions Market perceived areas of strength: • Performance toward core mission • Systems are providing timely and accurate data • ERCOT staff’s performance

25. Conclusions Market perceived need forsystem improvements with: • ERCOT.com navigation • Data extracts (content breadth) • Portal availability and usefulness

26. Conclusions (cont.) Market perceived communication gaps in: • Impacts of PRRs • Systems changes • Spending priorities • Grid operations decision process & Understanding of EMMS

27. Conclusions (cont.) Possible specific areas for strategic consideration by ERCOT Board: • Role of committees in setting spending priorities and introducing market changes • Defining and communicating expectations regarding ERCOT staff’s role in rules change process

28. ERCOT Response Coordination Team “Acting of Feedback”

29. ERCOT Response Coordination Team • Tasked by the ERCOT Officer Team to: • Coordinate with ERCOT Executive M’gmt and HR&G on priorities • Task cross functional internal teams assigned to: evaluate, recommend change, establish objectives, tracking mechanism and draft market message • Ensure coordination, consistency and action takes place addressing priority areas that “Need Attention” • Update HR&G within 90 days and then as requested

30. ERCOT Response Coordination Team • Gary StroudRichard GruberMark WalkerLarry Grimm • Representation that brings a diverse perspective of the various audiences: • Market Participants • Regulators and Legislators • ERCOT Staff • Will strive to keep all audiences informed and aligned to our common purpose – Make the Texas Electric Market Better

31. ERCOT Response Coordination Team • Initial meeting focused on high level analysis and categories of items that Need Attention: • Communications • Tools • Process • Delivered survey results to ERCOT management team (Directors and Managers) 6/9 • Begun scoping out specific approach appropriate for items or groups of items • Begun identifying team lead candidates

32. Questions ?