Update from ERCOT Retail Market Services to RMS October 16, 2003

1. Update from ERCOT Retail Market Services to RMS October 16, 2003

2. Retail Market Update Topics • Data Variance / Data Archive Workshop Update • FasTrak D2D / DEV Update • Pre-TX SET 1.5 Clean up Progress Report • Ongoing Data Clean Up Update • Inadvertent Gain Task Force Update • Texas Market Link (Phase 1) Update • Texas Market Link (Phase 2) Update • Move-In /Move-Out Market Solution to Stacking (V2.0) • Flight 1003 Update

3. SCR 727 ExtractWorking Group Meeting

4. RMS Decision from 9/26/03 Convene a Working Group to: • Work out details of the resolution process • Determine prioritization of issues to be worked • Identify any appropriate threshold for usage variance • Determine how to track Market Participant completion of data variance processing responsibility

5. Actions from 9/30/03 SCR 727 Training Meeting • Send out questionnaire on variance process and timelines • Responses due to ERCOT by COB Monday 10/6 • Responses received from 3 TDSPs and 3 CRs • ERCOT to compile responses • At 10/8 meeting, Task Force to define timelines based on responses • ERCOT to redline DEV manual to reflect prioritization issue with Trade Month.

6. Working Group Consensus • Target 75 calendar days for complete resolution • Prioritization • Keep prioritization as is currently outlined in DEV manual • ERCOT to change internal validations to allow trade months that fall within any minimum start time and maximum stop time provided in the spreadsheets.

7. 75 Calendar Days Settlement takes place 14 Days 21 Days 40 Days LSE Variances Submit Variance at least 75 days prior to scheduled resettlement ERCOT initial validation and analysis completed TDSP/CR Initial Response • ERCOT & CR: • Takes corrective action and/or • Performs Turnaround with MPs • Responds to submitter • Issues to Consider: • It is possible that the initial response from the TDSP/CR requires a turnaround to the initiator of the issue. Consensus on Target Timeline LSE Variances

8. 75 Calendar Days Settlement takes place NIDR Usage Variances 45 Calendar Days 30 Calendar Days Submit Variance at least 75 days prior to scheduled resettlement TDSP validation and analysis completed; Response provided to submitting party TDSP to send transactions if necessary or CR manually update system if needed • Issues to Consider: • Depending on the resolution of the variance, the TDSP may have to submit transactions. • ERCOT will work with TDSP to resolve any transaction issues to fix variances Consensus on Target Timeline NIDR Usage Variances

9. 75 Calendar Days Settlement takes place IDR Usage Variances 45 Calendar Days 30 Calendar Days Submit Variance at least 75 days prior to scheduled resettlement TDSP validation and analysis completed; Response provided to submitting party TDSP to send transactions if necessary or CR manually update system if needed • Issues to Consider: • Depending on the resolution of the variance, the TDSP may have to submit transactions. • ERCOT will work with TDSP to resolve any transaction issues to fix variances Consensus on Target Timeline IDR Usage Variances

10. 75 Calendar Days Settlement takes place 45 Calendar Days 30 Calendar Days ESI ID Characteristics Submit Variance at least 75 days prior to scheduled resettlement TDSP validation and analysis completed; Response provided to submitting party TDSP to send transactions if necessary or CR update system manually if needed Settlement takes place 10 Calendar Days 65 Calendar Days ESI ID Existence Submit Variance at least 75 days prior to scheduled resettlement ERCOT validation and analysis completed TDSP to send transactions if necessary • Issues to Consider: • Depending on the resolution of the variance, the TDSP may have to submit transactions. • ERCOT will work with TDSP to resolve any transaction issues to fix variances Consensus on Target Timeline Service HistoryESI ID Characteristics Variances

11. 10-16-03 RMS Vote • Establish a 75 calendar day deadline for completion of each issue and each MP (including ERCOT) will complete the DEV process in accordance with the timelines and other requirements of the DEV manual.

12. RMS Discussion on Reporting • At ESI ID level for each point-to-point variance type, report: • % worked within 75 days • % that result in change of data • % worked that do not result in a change. • % worked outside 75 days • % that result in change of data • % worked that do not result in a change. • Data presented by REPs broken down by TDSP service territory

13. RMS Decision from 9/26/03 Convene a Working Group to: • Work out details of the resolution process – RMS Vote • Determine prioritization of issues to be worked – WG Consensus • Identify any appropriate threshold for usage variance – WG Consensus • Determine how to track Market Participant completion of data variance processing responsibility – RMS Discussion

14. Target Timeline for Extract, Variances, True-Ups Extracts 9/26/03 Post last “old” daily extract 10/1/03 Clear all “old” extracts from Portal 10/22/03 “New” daily extracts 10/6/03 “New” extracts available Variances 10/1/03 Stop “old” variance process 10/10/03 Complete existing variances w/ answers; Close remaining 2002 variances 10/13/03 Begin filing new variances; Deadline 75 days prior to 2/9/04 to file variances for 1/1/03 True-Up Settlements 10/1/03 Resettlement of 2003 dates beginning with selected June dates 2/22/04 Begin True-Up runs for 2003

15. FasTrak Issue Status • Day-to-Day • Data Extract Variances (DEV)

16. FasTrak 2003 “Day to Day”Issue Stats (as of 10-16-03) • Of the 340 In Progress with ERCOT, 208 are resolved and awaiting other party resolution check off • Total ESI IDs worked to date since January 1, 2003 = 242,111 • Of the 2,239 New and In Progress with Non- ERCOT, 18 are for the year 2002 • Number of ESI IDs not tracked

17. FasTrak Data Extract VarianceIssue Stats (as of 10-16-03) • Of the 171 In Progress with ERCOT, 16 are resolved and awaiting other party resolution check off • Issues submitted between 10-1-03 and 10-13-03 will be rejected (DEV Black-out Period) • On 10-11-03, 1,452 existing issues for 2002 Trade Months were rejected with comment of “RMS directed close out of 2002 variances filed under the original extract process” • A few 2002 remain open due to current work in progress

18. Pre TX Set 1.5 Data Clean Up • Directive from RMS 07-17-03 Meeting • Pre TX SET 1.5 Status Report • Ongoing Transaction Clean-up Process

19. Pre-TX Set 1.5 Data Cleanup Background: ERCOT identified “In Review”, “Scheduled” and “Canceled with Exception with Meter Reads” that were not completed from early 2002 to April 11, 2003. RMS Vote, July 17th, 2003: Recommend RMS direct ERCOT to completely clean-up by August 13th, 2003 the Pre-Tx Set 1.5 In Review, Scheduled and Cancel With Exception that have been identified and sent to the market participants which should include cancels with CR approvals. ERCOT will provide at August RMS full statistics involving market participants broken down per issue type. ERCOT is directed that if the TDSP provides file names, ERCOT will locate and re-process if it is a valid transaction. RMS directs the TDSPs and CRs to provide transactions or information necessary to achieve the completion of the data clean-up.

20. Pre-TX Set 1.5 Data Cleanup

21. Ongoing Transaction Data Clean-up Clean-up Process Steps: • ERCOT runs the query and defines the Action Items needed • In-Review with Meter Read: Notify TDSP and request 814_04/25 then transaction will complete. (Date Range equals or greater than 07/01/01.) • Scheduled No Meter Read: Notify TDSP and request 867 completing transaction. (Date Range equals or greater then 07/01/01.) • Cancel With Exception (CWE) with Meter Read: Notify CR and TDSP and find out if they thought the transaction had completed. If so – take corrective action. (Date Range is 04/12/03 to 08/31/03.) • Cancelled Permit Not Received with Meter Read: Notify CR and TDSP and find out if they thought the transaction had completed. If so – take corrective action. (Date Range is 04/12/03 to 08/31/03.)

22. Ongoing Transaction Data Clean-up Clean-up Process Steps Continued: • ERCOT distributes the lists to MP who owe the follow-up action. • MP Responds and ERCOT coordinates the clean-up activities. • ERCOT to report Monthly to RMS. Next Steps – Proposed Clean-up Process Timeline: October 20, 2003: ERCOT sends out new lists to CRs and TDSPs October 29, 2003: TDSPs send analysis to CR November 4, 2003: CRs respond to TDSPs and coordinate final response to ERCOT November 7, 2003: ERCOT receives responses from TDSP November 11, 2003 ERCOT prepares RMS report and sends out November 13, 2003: ERCOT reports at RMS

23. Customer Protection and 814_08 Issue • Background and Completed Items • Matrix and Progress Report • Other Status Items and Next Steps

24. Customer Protection Period and 814.08 Background ERCOT has determined that there was an issue with the 814_08 manual-processing tool related to the “cancel by customer objection” process. While ERCOT systems were updated appropriately, 972 ESI IDs (spanning the August 2002 through July 2003 time frame) were identified where ERCOT has been unable to confirm that the TDSP was sent the 814_08 cancel. Completed Items • ERCOT compiled lists and forward them to the TDSPs on 8/6/03 and CRs on 9/16/03 • Most responses to original request received by 9/19/03 (Still missing A.C.N. Response) • Scenarios resulting from original response included matrix • ONCOR and AEP TDSPs responded on Scenario 1 records by 10/3/03. (TNMP received 10/13/03 and CNP received 10/14/03) • ERCOT sent out all modified inadvertent FasTrak issues on 93 issues identified in Scenarios 2 through 7

25. Customer Protection Period and 814.08

26. Customer Protection Period and 814.08 Other Status Items • Of 34 FasTrak issues created (some contain multiple ESI IDs) – “dialog” has occurred on 18 (as of 10/13/03). • 4 of the 34 FasTrak issues are considered “resolved” (updated accordingly) • Note: Concern ERCOT not informed of “resolution” in some cases? Next Steps • ERCOT to continue to escalate missing responses • ERCOT to complete manual corrections to un-cancel and complete the transactions per Scenario 1 • CRs and TDSPs make decisions on outstanding FasTrak issues and provide response to ERCOT • ERCOT to provide status report to RMS Chair/Vice Chair by Nov 3rd

27. Texas Market Link(Phase 1) Update

28. Texas Market Link (TML) Status • TML migration activities began Friday, 10/3 and completed Sunday evening 10/5; Retail components down during migration. • Performance issues surfaced on morning of 10/6; related to Operating System corruption on web servers. • TML backed out and pre-migration portal restored by 10/7. • IT team is evaluating flaw in migration process and identifying corrective steps for re-launch.

29. ERCOT Portal Replacement Phase 2 Project Update to RMSPresented by Dave Odle

30. Portal Phase 2 Update Phase 2 is on schedule with requirements and initial design COMPLETED ITEMS: • Requirements Gathering • Market priority session – 10/2/03 • Requirements documentation • Documentation distributed to MPs

31. Portal Phase 2 Update Next Steps: • Build internal Project Plan – 10/25 • Requirements Transition to I.T. – 11/1 • Begin Initial Design – 11/1

32. Move-In/Move-Out Market Solution to Stacking (Texas Set V.2.0) Update to RMSPresented by Glen Wingerd

33. V2.0 Coordination Team Accomplishments/Goals • Continuing efforts for Project Success. • Continued improvements in communication • FAQ E-mail address for questions StackingFAQ@ercot.com • Educational Seminars at MP shops • Posted additional development documentation • Working design/functional issues as they are discovered • Most have been identified and resolved • Working on defining recommendations to TTPT for testing

34. Impact Level Efficiency Competition Communication Project Overview Summary of Changes: Manage customer expectations by accepting and processing all valid requests. • Business Problem • Existing NFI logic forces an unreasonable amount of dependency on labor intensive workarounds. • Execution of workarounds are causing synchronization issues between market participants. • Lack of synchronization leads to improper billing and mismanagement of customer expectations • Solution • All valid transactions will be accepted and processed based on a set of market rules. • Drop notifications will be sent at a point in time where the proper recipient can be positively identified. • Rule based cancellations are sent on a pre-determined timeline with enough time for the recipient to react.

35. Final Implementation schedule and plan due Market Coordination team review of Production Processing Schedules Production Implementation Date: 8/1/2004 TDSPs and ERCOT Production Processing Schedules due MIMO Task Force delivery of PRR to PRS Details on ERCOT exception processing due Testing checkpoints at weeks 5 & 8 10 weeks Market Test Draft Implementation schedule and plan due 7/7 2003 7/31 2003 8/31 2003 10/1 2003 11/14 2003 1/1 2004 5/3 2004 7/23 2004 5/17 2004 Texas SET Version 2.0 Final Baseline Oct. RMS 38 weeks Solution to Stacking Production Implementation Timeline

36. Next Steps • Details on ERCOT Exception Processing Due 11/14/03 • Develop Flight Test Plan • Procedural Requirements – TTPT • Conceptual Requirements – Market Coordination Team • Functional Requirements – TTPT Script Sub-Team • Monitoring Requirements – Stacking Testing Advisory Team • Develop Production Implementation Plan

37. Thank-you

38. Flight 1003 Status Report

39. Flight 1003 Status Report Flight stats: • There are 16162 transactions/steps • There are 302 trading partnerships Progress: • Connectivity – complete • Frame 1 – started Monday • A total of 3 frames for testing • Flight scheduled to conclude – 12/05/03

40. Questions ?