1. BAL-001-TRE-1 CPS2 Waiver FERC-Ordered Modification to ERCOT waiver CPS2 Report to RSC December 16, 2008

2. Real Power Balancing Control Performance - Purpose To maintain Interconnection steady-state frequency within defined limits by balancing real power demand and supply in real-time. Replaces CPS2 Waiver, R2 of BAL-001-0a Address FERC Order 693

3. FERC Order 693 Paragraph 315 Regional difference to include the requirements concerning frequency response contained in section 5 of the ERCOT protocols.

4. BAL-001-TRE-1 Applicability Balancing Authority Identify measurable events. Submit required data. Calculate annually the Interconnection Minimum Average Frequency Response for reliability. Calculate Interconnection 12 month rolling average frequency response. Calculate Resources 12 month rolling average frequency response performance.

5. Generator Owner Report to GOP the operating range and expected performance of each Resources’ frequency response. Resource Frequency Governor Response droop setting. Resource Frequency Governor Response dead- band, intentional and unintentional. Resource will sustain frequency governor response for duration of perturbation. Resource frequency governor response minimum twelve month rolling average performance. BAL-001-TRE-1 Applicability Continued

6. Generator Operator Report each Resources’ governor operating range and expected frequency response performance to the BA. Resource will sustain frequency governor response for duration of perturbation.

7. Interconnection Frequency Response Measurement

8. Expected FR Performance – Conventional Steam Turbine

9. Expected FR Performance – Combustion Turbine

10. Expected FR Performance – Combined Cycle Plant

11. Attachment 2 Steam turbine droop setting 5% or lower Mechanical governor - +/-0.036 Hz unintentional dead-band maximum Electronic and Digital governors - +/- 0.01667 Hz intentional dead-band maximum. Droop curve must be linear from dead-band.

12. Attachment 2 continued Combustion Turbines in simple cycle only mode Droop setting 5% or less. Maximum intentional dead-band +/-0.01667 Hz. Combustion Turbines in combined cycle mode Droop setting 4%. Maximum intentional dead-band +/-0.01667 Hz. Spreadsheets to demonstrate measurement techniques included with standard.

13. Attachment 2: Measurement of Resource Frequency Response

14. Measurement of Resource Frequency Response Must account for previous control of the Resource before and during a perturbation. Must account for units operating at their High or Low Operating Limits. Resources are not expected to provide frequency response outside their normal operating range.

15. Resource Performance During Down Ramp

16. Resource Performance During Up Ramp

17. Steam Turbine Performance Measurement

18. Remaining work on Standard Compliance section D preliminary Must be reviewed and finalized by drafting team Details of Resource performance during periods of limited reserves or previous control before and during a perturbation must be finalized.

19. Future Work The development of a real-time, continuous Resource Frequency Response measurement may be possible.