1. Lead from the front Texas Nodal http://nodal.ercot.com 1 Early Delivery System Testing Planning – Involving Market Participants TPTF May 22, 2007

2. Lead from the front Texas Nodal http://nodal.ercot.com 2 Objectives for today’s presentation Discuss EDS 3 Plan document TPTF comments Get acceptance of the EDS Timeline plan as a baseline Get agreement on additional MP involvement and the concept of the MP Handbook Share the focus and content for the first EDS 3 MP Workshop on 24 th May

3. Lead from the front Texas Nodal http://nodal.ercot.com 3 Market Trials Approach No Longer Valid This document was presented to TPTF twice in November 2006 Not approved due to insufficient detail Document contained approaches and dates no longer valid This document has been archived on the Nodal site, please disregard and do not use as a reference

4. Lead from the front Texas Nodal http://nodal.ercot.com 4 EDS 3 Plan - Response Approach & Main Comment Categories Comments responded to were included in the document and the necessary responses included in the spreadsheet Comment categoryAction Timeline – July vs. October What is mandatory? A table was added to Section 1.4 of the document clearly explaining each phase as defined by ERCOT Further detail required Testing process Data inputs and outputs Entry & exit criteria MP Readiness activities and timing Further detail added where available. The remaining detail will be gathered at the EDS Planning Workshops ERCOT will compile draft white papers –SCED details and gaps will be addressed and the document finalized from the EDS Planning Workshop with MPs Present to TPTF for approval Market Participant Handbook clarification Explanation of MP Handbook added to Section 1.5 This document will be further explained and refined to at the workshop Suggestions for content General punctuation Insertion of content/clarity Document updated accordingly. Registration & qualification activitiesThese activities are covered in the relevant Registration /Qualification documents. An explanation to be added to the introduction in this document for clarity Request for joint planning workshops going forward A section added to the document explaining the proposed workshops. First workshop scheduled for May 24 th to discuss SCED testing

5. Lead from the front Texas Nodal http://nodal.ercot.com 5 EDS 3 Plan - Summary of pending issues and plan of action Comment categoryAction Methodology for submitting offers ERCOT will compile a draft white paper - any details and gaps will be addressed at the first EDS Planning Workshop with MPs on May 24 th SCED input data questions SCED SMEs will be available at the first EDS Planning Workshop on May 24 th to address issues Interface criteria for SCEDWeb Services developers will be available at the first EDS Planning Workshop on May 24 th to address issues LFC testing issuesEDS Planning Workshop to be scheduled to define solutions with ERCOT SMEs and MPs All comments in the pending category related to the requirement for further detail and were classified as pending. These areas will be explored further during ongoing planning forums.

6. Lead from the front Texas Nodal http://nodal.ercot.com 6 Planning & MP Involvement Approach

7. Lead from the front Texas Nodal http://nodal.ercot.com 7 Ongoing EDS Planning Process Planning Phase or Artifact EDS ApproachEDS PlanMP Planning Workshops and WebEX Meetings MP HandbooksPre EDS Test Scripts ContentDocument defining the phases and artifacts from ERCOT for EDS planning and execution. Detailed plan defining sufficient detail for MPs to begin planning system functionality and implementation sequence. Detailed planning sessions to build consensus on data, test cycles, test scenarios, entry and exit criteria to be included in the MP Handbook. Consolidated agreed content from MP workshops Calendar, test cycles, contact information, data requirements, test scenarios & scripts etc. Detailed scenarios and data input requirements for two weeks of testing. To be provided in rolling two week intervals. TimingNovember 2006May 2007June to September 2007 June to September 2008 July 2007 to Sept 2008 FrequencyOnce Weekly to Monthly by MP type Complete prior to EDS start. Calendar / Data updates during execution. Initial release prior to EDS start. Updates & additions during execution. Output Medium MS Word posted on Nodal.ercot.com TPTF Purpose Informational Approval

8. Lead from the front Texas Nodal http://nodal.ercot.com 8 EDS Testing Artifacts JanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDec EDS 3 LMP Data ValidationRegUpload Offers Rel 5 Rel 7 Rel 6 6 month LMP Posting CRR Data ValidationTrial Ops of CRR LFC COMs Testing EDS EDS 3 LFC Testing EDS 4 RTM Go-Live DAM Go-Live Legend Settlements Statements Upload Bids Test Settlements Outages DAM, RUC, SASM Full Nodal Functionality 24*7 Operation 168 Hr Test EDS Go-Live Activities EDS 4 MP Interface Spec Major milestones EDS Preparation Milestones Rel 8 Rel 9 EDS Approach EDS 3 Plan SCED Handbook LFC Handbook EDS 4 Plan CRR Handbook S&B Handbook DAM Handbook 168 Hour Test Handbook Go-Live Handbook TPTF Approval TPTF Information ERCOT & MP Readiness Reporting EDS Testing Status Reporting

9. Lead from the front Texas Nodal http://nodal.ercot.com 9 The Nodal timeline contains early EDS phases to ensure ERCOT & MP readiness … Early Start

10. Lead from the front Texas Nodal http://nodal.ercot.com 10 Participation in the EDS 3 Testing Phases (Section 1.4 – EDS 3 Plan) Market Participant TypeActivitiesTimeframeExpectation QSEs with resources planning on utilizing API’s in production MP Development Connectivity Testing (Sandbox) July - SeptemberStrongly Recommended MP Connectivity Testing (EDS Environment)July - SeptemberStrongly Recommended MP Connectivity Testing (EDS Environment)OctoberMandatory * MP Input Validation – SCEDAug – SeptemberStrongly Recommended MP Input Validation – SCEDOctoberMandatory * MP Input using SCED User InterfaceOctoberRecommended ** All QSEs with resources MP Input using SCED User InterfaceJuly – SeptemberRecommended ** MP Input for SCED ExecutionOctober – DecemberMandatory for designated EDS testing days MP Input for 6 month LMP PeriodJanuary – June 2008Mandatory based on define scenarios and methodology QSEs with resources not planning on utilizing API’s in production MP Input using SCED User InterfaceOctoberMandatory * * Starting in October Market Participant involvement is critical to begin producing “Reasonable” LMPs. During this period the Market Participants should have a partial EDS system in place to support the activities and functionality being demonstrated. The EDS team will provide workshops during this time to support Market Participants. Required Market Participants that are not able to participate will have to still perform these activities by requesting a ‘make-up’ workshop prior to involvement in later EDS activities. There will be limited opportunities for support due to focus on other EDS functionality. ** The EDS team recommends that all QSEs with resources schedule some time to get familiar with the SCED user interface even if they are planning on utilizing APIs in production. This will help ensure that Market Participants have a second method for accessing the EDS systems if their APIs are not functioning correctly.

11. Lead from the front Texas Nodal http://nodal.ercot.com 11 Texas Nodal SCED Workshop – 24 th May 2007 SME Support Requirement Scenario 10 May 2007

12. Lead from the front Texas Nodal http://nodal.ercot.com 12 Workshop Objective and Future Plans Share the draft Market Participant Handbook for SCED testing Answer any planning and testing questions from MPs present Target MPs at the workshop will be QSEs with resources The workshop will take place at MET Center and WebEx facilities will be available throughout The Market Notice and a reminder has already been sent (see slide #4) Answers to the questions provided at the workshop will be included in the MP Handbook to be used by the MPs during testing This workshop will be the first in the series of either monthly meetings or WebEx’s to prepare ERCOT and the MPs for Market Trials which begin in July 2007 – Frequency?

13. Lead from the front Texas Nodal http://nodal.ercot.com 13 *******TEXAS NODAL MARKET NOTICE******* NOTICE DATE: May 8, 2007 NOTICE TYPE: General – EDS 3 Planning Workshop SHORT DESCRIPTION: ERCOT will host the first in a series of EDS 3 Planning Workshops on Thursday, May 24, 2007. INTENDED AUDIENCE: NTPM and EDS 3 Technical Contacts DAY AFFECTED: May 24, 2007 LONG DESCRIPTION: To ensure both ERCOT and Market Participants can maximize the benefits of the EDS, ERCOT will be hosting EDS Planning Workshops as well as ongoing conference calls to complete the details required for EDS 3 execution. This test planning workshop will provide early details on submittal of resource data elements, test preparation, testing scenario review and development, testing calendars, and specific exit criteria for EDS 3. The first EDS 3 Planning Workshop is scheduled on Thursday, May 24, 2007 from 9:00 a.m. until 4:00 p.m. This workshop is targeted to Nodal Transition Project Managers and EDS technical planning team members involved in Security Constrained Economic Dispatch (SCED) input and validation testing. The agenda for this workshop will be distributed with all workshop materials prior to the meeting date. The agenda topics for the first EDS 3 Planning Workshop include: EDS 3 Readiness Activities Walkthrough EDS 3 SCED workshop materials, which will be distributed to participants prior to the workshop –Phase 1 – July through September Activities –Phase 2 – October through December Activities –Input data methodology –Participant feedback, comments, key issues Technical Questions and Answers with Project Subject Matter Experts on the MMS and EIP EDS 3 Entry & Exit Criteria Discussion – Per Phase Open Question & Answer period –Discuss Ongoing Planning Forums ACTION REQUIRED: Please RSVP by replying to this notice or sending an email to NodalMarketTransition@ercot.com. Please provide the Market Participant company you are representing as well as additional attendees and their email addresses. If you wish to designate an alternate in your place, please indicate so in your RSVP.NodalMarketTransition@ercot.com ADDITIONAL INFORMATION: The seminar will be held on Thursday, May 24, 2007 from 9:00 a.m. until 4:00 p.m. CDT at: ERCOT Austin 7620 Metro Center Drive Room 206 Austin, Texas 78744 512-225-7000 A map and driving directions can be found at http://www.ercot.com/about/locations/map_austin.html.http://www.ercot.com/about/locations/map_austin.html To participate in the workshop using WebEx, follow the steps below: 1. Go to https://ercot.webex.com/ercot/j.php?ED=1609438&UID=0https://ercot.webex.com/ercot/j.php?ED=1609438&UID=0 2. Enter your name and email address. 3. Enter the meeting password: EDS3123!! 4. Click "Join". 5. You will be provided a dial-in telephone number upon joining the WebEx. CONTACT: If you have any questions, please contact your ERCOT Account Manager. You may also call the general ERCOT Client Services phone number at (512) 248- 3900 or contact ERCOT Client Services via e-mail at NodalMarketTransition@ercot.com.NodalMarketTransition@ercot.com If you are receiving e-mail from an ERCOT distribution list that you no longer wish to receive, please follow this link in order to unsubscribe from this list. (http://lists.ercot.com/cgi-bin/majordomo?module=)http://lists.ercot.com/cgi-bin/majordomo?module=

14. Lead from the front Texas Nodal http://nodal.ercot.com 14 Typical Questions (Not all MMS or SCED related) What are ERCOT’s expectations of hardware on the MP side? Does ERCOT expect MP’s to have “go-live” hardware installations in place by July? Does the previously published SLA apply to the “Early” EDS testing of July – September? When will MP’s receive the testing scripts referenced in 2.2.1? Also, in the same section, there is a reference to a Communication Process/Tool. Is this in place and documented or is it referring to the SLA? On the EDS 3 Staffing Organizational Chart (7.2), can you please include names where possible? This is shown on the EDS 1 Chart and we have found it very helpful. Please elaborate on “Mock Settlement Statements” and what this means (Section 5). We need more detail on what “Mock Settlement” looks like and what software we need to have in place to be ready. More importantly, our vendors need to have more clarity. When will the “Error Notification API” be delivered (2.2)? This API is a crucial deliverable for effective testing and debugging of software problems. Note: how do MPs see the data which have been accepted by ERCOT? Execution of SCED utilizing Real-Time ICCP data – October 07 - does this step include the ability to create proxy curves? SCED MIS Reporting – November 07 – can MPs see their Resource HASLs, LASLs, SURAMPs, SDRAMPs, HDLs, LDLs via MIS? QSE Interactions with Interface Testing – is this required to access MIS and/or to use Machine-to-Machine interface? Each Resource’s responses will be measured against the regulation signals - will LFC ability to calculate and issue Emergency Base Point be tested? The QSE under test will be asked to submit resource level base points to match its schedule for the test hour. The base points provided should be at 5 min intervals - can QSEs send their resource Base Points to ERCOT via ICCP? SCED (for base points) - which function calculates the proxy curves? Is it part of this package?

15. Lead from the front Texas Nodal http://nodal.ercot.com 15 Agenda - AM Agenda for EDS 3 Planning Workshop Thursday – May 24, 2007- 9:00pm-4:00pm Location: ERCOT Austin MetCenter WebEx Conference (https://ercot.webex.com/ercot)https://ercot.webex.com/ercot Teleconference: TBD Meeting number: TBD Meeting password: TBD Thursday May 24 th 1.Meeting Kickoff o Review Agenda o Meeting Logistics o Team Introduction o EDS Overview J. Hall9:00 am 2.EDS Readiness Activities o Nodal Sandbox o Qualification M. Mereness9:15 am 3.Walkthrough of Market Participant Handbook (EDS 3 initial draft) o EDS July - September Activities o Participant Handbook feedback & comments o Input data methodology o Group questions and discussions K. Kasparian K. Sumanam 9:30 am 4.Break10:45 am 5.Walkthrough of Market Participant Handbook (EDS 3 initial draft) o EDS October - December Activities o Participant Handbook feedback & comments o Input data methodology o Group questions and discussions J. Hall C. Gamoke 11:00 am 6.Lunch Break(60 min)

16. Lead from the front Texas Nodal http://nodal.ercot.com 16 Agenda - PM 6.Lunch Break(60 min) 7.Technical Questions & Answers o MMS Project Teams o External Web Services o Requested topics Project SMEs1:00 pm 8.EDS 3 Entry & Exit Criteria Discussion – Per PhaseC. Gamoke2:30 pm 9.Open Question & Answer period o Review Questions from Handbook Feedback o Discuss Written Questions from Audience EDS Team3:30 pm 10.Discuss Ongoing Planning Forums o Identify Items o WebX & conference call dates o Future Workshops J. Hall3:30 pm Adjourn End by 4pm