energy strategies

1. energy strategies Western Electricity Coordinating Council Overview By Scott A. Gutting June 21, 2006 Power Through Ideas www.energystrat.com

2. DISCUSSION AGENDA • Overview of WECC • Western Transmission Congestion & Initiatives • Key Issues for Industrial Customers • Questions & Discussion Power Through Ideas www.energystrat.com

3. Overview of Western Energy Coordinating Counsel (WECC) • 170 + members • Members include utilities, independent power producers, consumers and regulators. • WECC has been a reliability council since the early 1970's • WECC activities typically address the High Voltage transmission system - > 138kV Power Through Ideas www.energystrat.com

4. Overview ofWECC Power Through Ideas www.energystrat.com

5. Overview ofWECC Future Load & Resource Picture Power Through Ideas www.energystrat.com

6. Overview of WECC • Key WECC Functions • Electric Reliability - WECC coordinates, sets and maintains electric reliability standards in the west.  WECC expects to implement mandatory reliability standards that result from The Energy Policy Act • Determines and sets operating standards for the western interconnection • Conducts transmission system impact studies for the purpose of maintaining and improving electrical reliability • Funds and oversees three major reliability centers whose job is to work together to "keep the lights on " • Provides transmission expansion services to members • Works with members on solving commercial issues that impact system reliability Power Through Ideas www.energystrat.com

7. Overview of WECC • WECC Standards & Policies that may impact Industrial Customers: • Mandatory Reliability Standards & EPAct • Utility Reserve Margin Requirements • Operating and Contingency Reserve Requirements • Commercial Practices • Transmission Expansion Planning Power Through Ideas www.energystrat.com

8. Western Transmission Congestion & Initiatives Power Through Ideas www.energystrat.com

9. Western Transmission Congestion & Initiatives WECC Sub-Regional Planning Groups NTAC NorthwestTransmissionAssessmentCommittee RMATS RockyMountainAreaTransmissionStudy CCPG CAISO ColoradoCoordinatedPlanningGroup CaliforniaIndependentSystemOperator SWAT SouthwestAreaTransmission STEP SouthwestTransmissionExpansionPlanning 8 Power Through Ideas www.energystrat.com

10. Western Transmission Congestion & Initiatives Northern Lights John Day-McNary Montana Alberta Tie Line Seabreeze DC Southwest Intertie Project Frontier Project TransBay DC Line Trans-West Express Project Robinson Summit- Harry Allen 500 kV Miracle Mile-Ault Tehachapi Wind Interconnection Navajo Transmission Project Segment 1 Green Path Project IV-San Felipe Indian Hills - Upland Colorado-New Mexico Interconnection Project Sunrise Powerlink Palo Verde–Devers II Power Through Ideas www.energystrat.com

11. Western Transmission Congestion & Initiatives • Rocky Mountain Area Transmission Study (RMATS). • Formed by Gov. Freudenthal (Wyo.) & Gov. Leavitt (UT). • Initiated in August 2003. • Electric Power Industry Reluctant to invest in Transmission. • Evaluate All Potential Transmission Alternatives in the Rocky Mountain Region. • Results showed several Wyoming transmission plan upgrade opportunities. Power Through Ideas www.energystrat.com

12. Western Transmission Congestion & Initiatives • TOT3 • SE Wyoming to NE Colorado route. • MOU between WAPA/WIA/Trans-Elect to study and develop the project. • 500 MW line/345kV/$318 million. • Solicitation for statement of interest issued November 2005. • TransWest • Wyoming to Arizona route. • Cost range of $2-5 billion. • Two 5000 kV transmission lines. • Currently in feasibility study phase. • Plans predict the lines will be in service by 2013. • May provide utilities in AZ, NV, NM, CA, CO and UT access to additional resources to meet load growth. Power Through Ideas www.energystrat.com

13. Western Transmission Congestion & Initiatives • Frontier Line • Announced by Governors of CA, NV, UT and WY in April 2005. • Wyoming to California route. • $3.5-5.0 billion in transmission assets/$10-15 billion in general assets. • Facilities development of renewables (wind) and mine mouth coal plants. • Phase 1 Feasibility Study initiated. • Northern Lights Project • Wyoming/Montana to Southwest U.S. Route • Cost Range $1+ Billion • Part of two leg plan to move power out of Alberta, Canada • 3.000 MW capacity, DC line • Plans predict on-line date of 2011 Power Through Ideas www.energystrat.com

14. Key WECC Issues for Industrial Customers • System & Utility Reserve Margin & Resource Adequacy Issues • Commercial Issues/Practices • TEPPC Expansion Planning Efforts Power Through Ideas www.energystrat.com

15. Key WECC Issues for Industrial Customers • System &Utility Reserve Margin & Resource Adequacy Issues • Resource Adequacy Standards • Load & Resource Committee • Operating Reserve Task Forces • Frequency Reserve Response Issues • Other Power Through Ideas www.energystrat.com

16. IRP Case Studies: Approaches to Determining Capacity Resource Sufficiency Power Through Ideas www.energystrat.com

17. Key WECC Issues for Industrial Customers • Commercial Issues/Practices • Generation re-dispatch • Definition & qualification of contingency reserves • Natural gas & electric generation interdependencies • Ancillary service markets • NAESB participation • Other Power Through Ideas www.energystrat.com

18. Key WECC Issues for Industrial Customers • TEPPC Formal Expansion Planning Efforts • WECC Regional Planning Groups • Use of West-wide SSG-WI Database and Promod Expansion Planning Analysis • Continuing Data Confidentiality Issues Power Through Ideas www.energystrat.com

19. WECC Sub-Regional Planning Groups NTAC NorthwestTransmissionAssessmentCommittee RMATS RockyMountainAreaTransmissionStudy CCPG CAISO ColoradoCoordinatedPlanningGroup CaliforniaIndependentSystemOperator SWAT SouthwestAreaTransmission STEP SouthwestTransmissionExpansionPlanning 8 Power Through Ideas www.energystrat.com

20. energy strategies WECC OVERVIEW • Questions & Discussion 2 Power Through Ideas www.energystrat.com