Time of Use Base Interruptible Program (TOU-BIP) Aggregation

1. Time of Use Base Interruptible Program (TOU-BIP) Aggregation June 2007

2. Introduction • Background information • Program description • Program requirements • Roles & Responsibilities • Participation • Resources & Tools BIP Aggregation

3. Program Background • On Nov 30, 2006, the CPUC adopted Decision D.06-11-049 directing utilities to implement changes to Demand Response programs. • On Dec 15, 2006 SCE filed Advice Letter 2073-E to amend Schedule TOU-BIP to allow Aggregators to participate as one of the changes ordered in D.06-11-049. • SCE filed supplemental changes on March 28, 2007 and the CPUC approved them on April 28. BIP Aggregation

4. Program Overview • TOU-BIP is an interruptible tariff, whereby a participant (directly enrolled customer or Aggregator) reduces load when notified by SCE. In exchange, SCE provides a monthly discount on the TOU rate (for directly enrolled customers) or payment (for Aggregators) based on the amount of load reduction contracted • TOU-BIP may be called a successor to the I-6 tariff, which will be phased out by November 2008 • TOU-BIP load reductions are not directly controlled by SCE. When an event is called, the utility sends a notification to the participant, who is expected to voluntarily reduce load as contracted BIP Aggregation

5. Program Overview • TOU-BIP participants must choose a Firm Service Level (FSL), which is the minimum electrical demand necessary to meet the basic operational requirements of the customer service accounts in an Aggregated Group, during an interruption event. • During a Period of Interruption the participant must reduce load to its specified FSL or pay an Excess Energy Charge • Participants may choose two curtailment options: • A – curtail load within 15 minutes of notification • B – curtail load within 30 minutes of notification BIP Aggregation

6. Program Overview • Participants must have a monthly maximum demand of at least 200 kW: • Directly enrolled customer – individual account demand • Aggregated Group – aggregated demand • Participants must curtail at least 15 percent of the maximum demand, which shall not be less than 100 kW per Period of Interruption. BIP Aggregation

7. Program Overview • Any eligible SCE customer or 3rd Party may aggregate SCE customers’ load and make it available for reduction or interruption when SCE issues a Notice of Interruption • The need to implement load reductions is determined by CAISO (Stage 2) or SCE’s Grid Control Center (system constraint) BIP Aggregation

8. Program Overview • An aggregator, or customer wishing to act as an aggregator, must sign a TOU-BIP Aggregator Agreement and form an Aggregated Groupto participate • Participants may not take insurance for willful failure to interrupt load • Essential use customers that are also exempt are NOT eligible for aggregated groups, but may participate in TOU-BIP by directly enrolling with SCE (FSL < 50% of load) BIP Aggregation

9. Program Requirements • A customer account receiving service on a TOU tariff, and therefore having an IDR meter, may be part of an Aggregated Group regardless of service account demand. Customers currently not taking service on a TOU tariff must first switch to a TOU tariff before enrolling in an Aggregated Group. • Service accounts in an Aggregated Group may not be enrolled in certain other Demand Response programs, including I-6, TOU-BIP, SDP, AP-I, CBP, or CPP. BIP Aggregation

10. Program Requirements • Customers in an Aggregated Group may participate in the Demand Bidding Program (DBP) but may not receive payments from DBP if there is an overlapping event • Aggregated load must be 200 kW or more • Minimum curtailment: 15% of load or at least 100 kW above the Firm Service Level (FSL) chosen by the Aggregator BIP Aggregation

11. Program Requirements • Choice of Notification Option A or B • A – curtail load within 15 minutes of notification • B – curtail load within 30 minutes of notification • All customers in an Aggregated Group must be: • On same voltage level • Bundled, Direct Access, or CCA – no combination groups are allowed • On one Notification Option only – A or B BIP Aggregation

12. Program Requirements • A new Aggregated Group may be added any time of the year, but changes to an existing Group or termination of a Group may only be made during the November 1-December 1 window • Each Aggregator will have at least one RTU (installed and paid by SCE) per Notification Option located in SCE territory and one dedicated phone line per RTU and another dedicated phone line for voice notification (phone linesinstalled and paid by Aggregator) BIP Aggregation

13. Program Requirements • Aggregator will receive monthly credit based on available interruptible load, even if there is no call for interruption • Credit is relatively high in summer months (on- and mid-peak) and reduces substantially during the winter months (mid-peak only) BIP Aggregation

14. Program Requirements • Aggregator will incur an excess energy charge (penalty) for failure to reduce load to its Firm Service Level during an event • Aggregator’s monthly credits will be calculated based on periods as defined in the TOU-BIP tariff, regardless of time periods defined in an individual customer’s particular tariff, such as TOU-GS-3-SOP BIP Aggregation

15. Key Issues - related to program requirements and participation • The Aggregator is entirely responsible for load reduction to the FSL and any associated excess energy charges • CPUC’s Affiliate Guidelines prohibit SCE from recommending a specific Aggregator. SCE may refer interested customers to SCE’s website for a list of entities with a signed Aggregator Agreement Responsible SCE Organizations BIP Aggregation

16. Roles & Responsibilities • BCD (SCE) Account Representatives • Promote program to customers • Manage customer and Aggregator expectations • Provide rate analysis support (BCD Technical Support can assist as needed) • Partner with Tariff Programs and Services (TP&S) to maintain and expand program, as necessary BIP Aggregation

17. Roles & Responsibilities • TP&S (SCE) Program Managerand Operations Team • Process application and resolve any program-related issues • Ensure proper billing (credits/excess energy charges) and data management • Ensure RTU functions as designed • Partner with BCD to maintain and expand program, as necessary BIP Aggregation

18. Roles & Responsibilities • Aggregator • Sign Aggregator Agreement with SCE • Sign up customers to join Aggregated Group • Ensure communication between RTU and customer load (notification, visibility to load reductions, etc.) • Ensure Group reduces load to meet FSL • Ensure customer satisfaction with program and clarify that Aggregator is a facilitator of a utility program and does not represent SCE BIP Aggregation

19. Roles & Responsibilities • Customers Participating in Aggregation • Sign Customer Declaration & complete other required documents • Reduce load as agreed with Aggregator • Resolve any contractual or credit/excess energy charge or technical issues (notification, load drop, etc.) with Aggregator and NOT with SCE BIP Aggregation

20. Process of Becoming an Aggregator • Visit www.sce.com/drp or call the DRP Helpline at (866) 334-7827or contact your SCE account representative. • Aggregator without Customers • Execute Aggregator Agreement • Test RTU interface with Aggregator communications system • Aggregator with Customers in Aggregated Group • Execute Aggregator Agreement • Complete Attachments B (section 1&2), C, & D • Revise Aggregated Group • Complete Attachments B (section 1&3), C, D, & E • Terminate Aggregated Group • Complete Attachment B (section 1) BIP Aggregation

21. Process of Becoming an Aggregator • Aggregator without Customers • Aggregator to establish credit • Demonstrate credit rating • Baa2 or higher - Moody’s • BBB or higher – S&P, Fitch, or Duff & Phelps OR • Minimum Security Deposit • $4,000 • SCE will list Aggregator on SCE website BIP Aggregation

22. Process of Becoming an Aggregator • Aggregator with Customers • Execute Aggregator Agreement • Establish credit (rated company or appropriate deposit based on committed reduction for that group; based on Annual Max Demand of listed accounts minus group FSL) • Complete Attachments • B (section 1&2), C, & D BIP Aggregation

23. Process of Becoming an Aggregator • Provide following data for each Aggregated Group: • List of all service accounts • Customer declaration from each customer • Customer Information Standardized Request (CISR) from each customer and Rate Change Request form (if necessary) • Option (A or B), estimated max demand of Group, FSL of Group, voltage level, two unlisted & dedicated phone lines • SCE will establish an Aggregated Group and begin net credit payment within 60 days of a valid, signed Aggregator Group BIP Aggregation

24. Key Issues - related to process • Necessary to establish credit • Two unlisted and dedicated telephone lines installed and able to accept event notifications from SCE, 24/7 • RTU must effectively communicate with Aggregator’s system - accurate, real time, 24/7 BIP Aggregation

25. Key Issues - related to process • Credit payments issued to Aggregator within 60 days of operating month-end • SCE reps should inform customers about Aggregators (refer to www.sce.com/drp). Reps must not introduce specific Aggregator to customers due to CPUC affiliate guidelines. Customer or Aggregator can invite rep to joint meeting, but rep cannot invite Aggregator. BIP Aggregation

26. Resources & Tools • FactSheets – hardcopyandon-line • Listing of Aggregators on SCE websitewww.sce.com/drp • Credit/Excess energy charge analysis for specific Aggregated Groups as requested • BCD Tech Support BIP Aggregation

27. Resources & ToolsMonthly Credits ($/interruptible kW per Month) Participation Option A: Below 2 kV2 to 50 kVAbove 50 kV Summer Season -on peak $ 17.89 $ 17.48 $ 16.84 -mid-peak $ 5.50 $ 5.40 $ 5.22 Winter Season -mid-peak $ 2.02 $ 1.98 $ 1.90 Participation Option B: Below 2 kV2 to 50 kVAbove 50 kV Summer Season -on peak $ 16.45 $ 16.10 $ 15.52 -mid-peak $ 5.02 $ 4.92 $ 4.74 Winter Season -mid-peak $ 1.93 $ 1.89 $ 1.82 BIP Aggregation

28. Resources & ToolsRTU Information Flow ** Back up telephone will be used in addition to the RTU to notify Aggregator BIP Aggregation

29. Resources & ToolsExcess Energy Charges ($/kWh consumed above FSL during Period of Interruption) Below 2 kV2 to 50 kVAbove 50 kV $ 10.21374 $ 9.99551 $ 9.63234 BIP Aggregation

30. Resources & Tools Credit Calc Example BIP Aggregation

31. Resources & ToolsExcess Energy Charge Calculation Example BIP Aggregation

32. Contacts • Ishtiaq A Chisti BIP Aggregation Project Manager (626) 633-3442 PAX 43442 • Carol Waterbury Operations Program Manager (626) 633-3416 PAX 43416 • Lauren Pemberton Manager, Program Planning Analysis & Oversight, TP&S • Larry Oliva Director, TP&S • Demand Response Program Information • (866) 334-7827 or (626) 633-3493 [PAX 43493] • www.sce.com/drp BIP Aggregation