PWG Update Report By Ernie Podraza of Reliant Energy ERCOT PWG Chair for RMS Meeting

1. PWG Update Report By Ernie Podraza of Reliant Energy ERCOT PWG Chair for RMS Meeting January 11, 2006

2. Annual Validation 2005 Status - Business • All TDSPs have submitted their transactions. • All TDSPs have met the 99 percent requirement. • - (LPG 11.4.1 steps 11 and 12) • Business Complete.

3. Annual Validation 2005 Status - Residential • All TDSPs but two have submitted their transactions per the RMS resolutions. • All TDSPs are waiting on TAC and BOD approval of 2005 Annual Validation modifications per the RMS resolutions for the partial list of transactions so 2005 Annual Validation can be considered complete.

4. Annual Validation 2006 Status - Business • Previously reported two changes under consideration for load factor calculations; • kWh minimums, and • exclusion of zero kWh readings. • December 15, 2005 the PWG by consensus has dropped these two suggested changes to Annual Validation because the ERCOT Staff analysis indicated almost nil affects. • Market benefits do not warrant expenses to implement.

5. Annual Validation 2006 Status - Residential • Previously reported two changes under consideration for winter ratio calculations; • weather normalizing the trigger points, and • different trigger points per weather zone. • December 15, 2005, the PWG by consensus has placed these two suggested changes to Annual Validation on hold pending market review of “Option 2” change in Profile ID assignment responsibility and subsequent market consideration of the new residential assignment algorithm developed by ERCOT Staff.

6. “Option 2” - Residential “Option 2” is moving a portion of the residential Load Profile ID assignment responsibility in the Annual Validation process from the TDSPs to ERCOT Staff, whereby the Load Profile Type is calculated annually at ERCOT and the information passed to each TDSP and/or Muni-COOP.

7. “Option 2” - Residential • Once per year, ERCOT calculates the Load Profile Type and provides a file of changes to each TDSP. • Each TDSP takes the file and creates appropriate 814_20s, and updates their systems. • TDSPs are still responsible for the Load Profile ID assignment for new accounts and any updates needed for normal business.

8. “Option 2” - Residential

9. Profile Type Code (1) Meter Data Type Code (3) (1) (1) Profile Group Profile Segment NIDR IDR Group Segment Weather Zone Code (2) Group Segment Coast FWest North East NCent SCent South West Weather Sensitivity Code (4) Time-Of-Use Code (5) (1) (1) TOUn NoTOU Group Segment NWS “Option 2” - Residential Example: RESHIWR_NCENT_NIDR_NWS_NOTOU

10. “Option 2” - Residential • Precedent for TDSP lists; • Protocols Section 11.4.3.1 Weather Responsiveness Determination … “ERCOT shall produce a report that contains the ESI IDs requiring profile code modifications and shall publish the report via the MIS. • TDSPs shall successfully complete Weather Sensitivity Code modifications (Profile ID changes) no later than sixty (60) days after the ESI ID appears on the ERCOT report.” • 2) RMS November email voting item, “The email vote to authorize 2005 Residential Annual Validation transactions for those ESI IDs for which ERCOT’s analysis shows such update would result in a more representative profile was APPROVED.” 

11. “Option 2” - Residential PWG by consensus agrees to change the responsibility of Residential Profile ID assignment calculation of Profile Type for Annual Validation from the TDSPs to ERCOT Staff. Upon approval of this recommendation by the appropriate TAC committees, any necessary PRR and/or LPGRR shall be written. After approval, the Decision Tree update shall be issued.

12. “Option 2” – Residential – VOTING ITEM RMS agrees to change the responsibility of Residential Profile ID assignment calculation of Profile Type for Annual Validation from the TDSPs to ERCOT Staff.