COPS – ERCOT PROJECTS UPDATE

1. COPS – ERCOT PROJECTS UPDATE WHOLESALE MARKET DEVELOPMENT Paula Feuerbacher August 23, 2005

2. PROJECTS: • PR40104 – Zero Charge Elimination • June: Market Participants were asked to consider system implications • July: ERCOT was assigned to perform analysis on extract modification – providing “null” notification informing no activity was encountered for a charge type. • August: ERCOT recommends to cancel the current project effort. • The storage savings to implement zero charge do not out-weigh the risk to statement provision stability. • Storage issues are being addressed by other infrastructure projects. • Review requirements within TNT effort. • PR50025 – Enhance ESI-id Look-up Function • Address PRR-312, assigned a priority of 1.2, ranked 34 on the 2005 PPL • Current project state: planning phase -- gathering requirements and performing analysis on impact to TDSP ESI-id extract. • Communication will be provided at the following meetings: • RMS – September 14, 2005 • COPS – September 27, 2005

3. Modified Competitive Solution Details • PR50010 – SIR Enhancement 5.2 • Section 6.9.5 of the Protocols – Settlement Obligation for Balancing Energy Service (Modified Competitive Solution) • Reduces / eliminates dependency on Miscellaneous Debit/Credit charge type • Improves ability of Market Participants to Shadow Settle • Reduces dependency on manual work-around • Market Release estimated for September 28, 2005 • New Charge Types: • MCSMPAY – modified competitive solution payment • MCSMCHG – modified competitive solution charge • New Bill Determinants: • MCSMPAY: • PAM_zone_QSE: manually calculated and imported by Settlement and Billing Staff reflecting positive values where payment is appropriate; 15 minute interval data. • PAMPRICE_zone_QSE: value Market Participant will be paid; 15 minute interval data. • PAMQTY_zone_QSE: value of 1 (when PAM > 0) or 0 (when PAM = 0); 15 minute interval data. • PAMBILLQTY_zone_QSE: quantity delta between current settlement run and prior settlement run; 15 minute interval data. • PAMAMT_zone_QSE: (-1*PAMPRICE*PAMQTY); 15 minute interval data. • PAMBILLAMT_zone_QSE: payment delta between current settlement run and prior settlement run; 15 minute interval data. • PAMBILLAMTTOT: total of all PAMBILLAMT for all zones for all QSEs; 15 minute interval data.

4. MCS cont…: • New Bill Determinants cont…: • MCSMCHG: • POSRI_QSE: the sum of all positive Resource Imbalance amounts for all zones per QSE when PAMBILLAMTTOT is not equal to zero; 15 minute interval data. • POSRITOT: the sum of all POSRI_QSE; 15 minute interval data. • POSLI_QSE: the sum of all positive Load Imbalance amounts for all zones per QSE when PAMBILLAMTTOT is not equal to zero; 15 minute interval data. • POSLITOT: the sum of all POSLI_QSE; 15 minute interval data. • IRS_QSE: imbalance ratio share calculated as (POSRI+POSLI)/(POSRITOT+POSLITOT); 15 minute interval data. • QPAMPRICE_QSE: {-1*(PAMBILLAMTTOT/(POSRITOT + POSLITOT))}; 15 minute interval data. • QPAMQTY_QSE: calculated as (POSRI + POSLI); 15 minute interval data • QPAMBILLQTY_QSE: quantity delta between current settlement run and prior settlement run; 15 minute interval data. • QPAMAMT_QSE: allocation amount uplifted to QSEs with positive Resource and/or Load Imbalance values calculated as (-1*IRS_QSE*PAMBILLAMTTOT); 15 minute interval data. • QPAMBILLAMT_QSE: charge delta amount between current settlement run and prior settlement run; 15 minute interval data. • QPAMBILLAMTTOT: total of all QPAMBILLAMT for all QSEs; 15 minute interval data

5. MCS cont…: • Formulas: QSE Share of Incremental Payments above the Adjusted MCPE (QPAMAMT) Imbalance Ratio Share (IRS)

6. PROJECTS: EMMS R4 • Estimated Deployment: September 28, 2005 • PR30131_02 – Resource Plan Improvements • PR30093 – Replacement Reserve • PR40050 – Resource Specific Bid Limits • PR30163 – OOM Tool