1. http://nodal.ercot.com 1 Nodal Stabilization Market Call December 28, 2010

2. http://nodal.ercot.com 2 Antitrust Admonition ANTITRUST ADMONITION ERCOT strictly prohibits Market Participants and their employees who are participating in ERCOT activities from using their participation in ERCOT activities as a forum for engaging in practices or communications that violate the antitrust laws. The ERCOT Board has approved guidelines for members of ERCOT Committees, Subcommittees and Working Groups to be reviewed and followed by each Market Participant attending ERCOT meetings. If you have not received a copy of these Guidelines, copies are available at the Client Relations desk. Please remember your ongoing obligation to comply with all applicable laws, including the antitrust laws. DISCLAIMER All presentations and materials submitted by Market Participants or any other Entity to ERCOT staff for this meeting are received and posted with the acknowledgement that the information will be considered public in accordance with the ERCOT Websites Content Management Operating Procedure.

3. General Updates and Reminders Reminder – with the New Year’s holiday there are a number of invoices due Monday, January 3 rd (7 invoices) –Nodal – payable to market bank account DAM – OD Dec 22, 23, 24, 25, 26, 27 (6 invoices due) RT – dated December 27 th (1 invoice due) The Zonal invoice dated December 27 th – payable to market bank account is due Tuesday, January 4 th Beginning with this invoice, Zonal invoices are for Finals and True-ups only (no more initial settlement statements) –Now that all Zonal initial settlement statements have been invoiced, for credit purposes, payments will be reflected in CMM the day after the due date (no more adjustments for prepaid invoices) Please be sure your accounting/treasury folks are prepared to pay these invoices timely To ensure credit is applied correctly, please provide invoice numbers with a wire transfer http://www.ercot.com 3

4. http://nodal.ercot.com 4 Special Topics Base Point Deviation Charges

5. Emergency Energy and Voltage Support Settlements Emergency Energy Settlements –The system wide emergency flag (meaning a SCED failure) has been activated twice 12-10: 21:30 through 22:45 12-11: 20:45 through 21:15 –Payments were made on both days 12-10 payments totaled $5225.80 12-11 payments totaled $6.56 –Emergency payments for manual overrides were made on the following days 12-1, 12-2, 12-4, 12-5, 12-7, 12-8, 12-10, 12-11, 12-13, 12-15, 12-16, 12-17, 12-18, 12-19 Voltage Support Service Payments –Settlements has not received any Voltage Support Instructions –No Payments have been made http://www.ercot.com 5

6. Base Point Deviation Changes Base Point Deviation Changes (NPRRs 272, 273 & 285) –Exempt all resources from the charge when a settlement interval contains a SCED execution of less than four minutes in duration –Remove the BPD charge for all IRRs (Intermittent Renewable Resources) –Exempt Quick Start Resource when it ramps online –Exempt Generation Resource when it ramps online and offline (Resource Status of ONTEST) http://nodal.ercot.com 6

7. Base Point Deviation Exemptions System Wide BPD Exemptions. ERCOT shall not charge BPD when: –Responsive Reserve has been deployed in a 15 minute settlement interval (RRSFLAG = 1) –A 15 minute Settlement Interval contains a SCED execution that is less than 4 minutes in duration (FQDEVFLAG = 3) –ERCOT System Frequency is both 0.05 within the same 15-minute Settlement Interval (FQDEVFLAG = 3) Individual Resource Exemptions. ERCOT shall not charge BPD when: –The generation deviation of the Generation Resource over the 15-minute Settlement Interval is in a direction that contributes to frequency corrections that resolve an ERCOT System frequency deviation; and –The ERCOT System frequency deviation is greater than +/-0.05 Hz at any time during the 15- minute Settlement Interval (FQDEVFLAG = 1, 2) –The unit is ramping online or offline: (TELHSLFLAG =1 when resource status is ONTEST) –A Quick Start Resource comes online: The first two settlement intervals once the resource starts are exempt: (TELHSLFLAG = 1) –A Dynamically Scheduled Resource is online and dispatched to a base point other than its output schedule for an entire 15 minute settlement interval. BPD can be charged after four consecutive, complete 15-minute Settlement Intervals have occurred after the DSR is dispatched to a Base Point other than its Output Schedule –A resource is a Qualifying Facility and did not submit an Energy Offer Curve (EOCQFLAG = 0) –The resource is RMR http://nodal.ercot.com 7

8. Base Point Deviation: Additional Resources Additional Resources for Base Point Deviation –Nodal Protocols section 6.6.5 –COMS Real Time Energy Requirements (http://nodal.ercot.com/docs/pd/coms/index.html#req)http://nodal.ercot.com/docs/pd/coms/index.html#req –Settlements Workshop Materials: RT_BPD Final File (http://nodal.ercot.com/training/courses/wsruc.html#materials)http://nodal.ercot.com/training/courses/wsruc.html#materials http://nodal.ercot.com 8

9. http://nodal.ercot.com 9 Questions?