1. 03/22/07 ACC Open MeetingSummer Preparedness 20071 SRP Summer Preparedness 2007 Mike Hummel Manager – Supply & Trading and Gary Harper Manager - System Operations ACC Summer Preparedness Hearing March 22, 2007

2. 03/22/07 ACC Open MeetingSummer Preparedness 20072 Eastern Mining Area Phoenix Peoria Glendale Scottsdale Mesa Tempe Gilbert Chandler Tolleson Litchfield Park Surprise Goodyear Avondale Apache Junction Queen Creek Fountain Hills Paradise Valley SRP Electric Service Territory

3. 03/22/07 ACC Open MeetingSummer Preparedness 20073 Summary Peak demand is expected to be higher than last year due to continued growth. Adequate resources have been secured to meet the anticipated demand. The risk of potential wildfires is a continuing concern.

4. 03/22/07 ACC Open MeetingSummer Preparedness 20074 Peak Load Forecast 6590 MW 6627 MW 2006 Actual2007 Forecast

5. 03/22/07 ACC Open MeetingSummer Preparedness 20075 Summer 2006 Retail System Peak ‘Needle Peak’ Summer 2006 new peak – 6590 MW Exceeded Base Forecast of 6210 MW by 380 MW – 16 hours Exceeded High Risk Forecast of 6448 MW by 150 MW (1:10 occurrence) – 3 hours 118 degree Peak Temperature (1:10 occurrence)

6. 03/22/07 ACC Open MeetingSummer Preparedness 20076 Summer 2007 Outlook SRPGeneration PurchasedPower SRPForecast Peak Load Reserves 5690 MW 1849 MW Expected Need 6627 MW 912 MW Total 7539 MW Expected Capability Total 7539 MW

7. 03/22/07 ACC Open MeetingSummer Preparedness 20077 Reserves Respond to load extremes above base forecast. Provide an immediate response to forced outages. Quantity is based on NERC and WECC operating criteria and contractual arrangements. A portfolio of resources is utilized to meet the reserve requirements. –Balances “reliability” and “low cost” objectives.

8. 03/22/07 ACC Open MeetingSummer Preparedness 20078 SRP Owned Generation – 2007 Coal 1791 MW Nuclear 672 MW Gas 2951 MW Hydro & Renewables 276 MW Total Capacity: 5690 MW

9. 03/22/07 ACC Open MeetingSummer Preparedness 20079 Purchased Power Purchased power portfolio is in place to meet demand. Additional purchases may be needed to respond to forced unit outages. Regional market conditions suggest that there will be sufficient capacity to meet the Arizona demand.

10. 03/22/07 ACC Open MeetingSummer Preparedness 200710 Fuel Status Nuclear – Full requirements under contract Coal –Plants expected to be at or above target inventories by summer season –Full requirements under contract Natural Gas –Full transportation requirements under contract –In process of securing retail commodity requirements –Distillate fuel back-up

11. 03/22/07 ACC Open MeetingSummer Preparedness 200711 Generation Maintenance Completed By Summer 2007 Units Agua Fria1,2,3,4,5,6 Craig2 Desert Basin1,2 Hayden2 Horse Mesa1,2,4 Kyrene7 Mormon Flat1,2 Navajo2 Palo Verde1,2,3 Roosevelt1 Santan1,2,3,4,5 Stewart Mountain1

12. 03/22/07 ACC Open MeetingSummer Preparedness 200712 NEWNUMBER - Distribution Substations5 - 28MVA 69/12kV Transformers9 - 230kV Breakers12 - 69kV Breakers43 - 69kV Capacitors48 MVAR -230/69kV Transformers2 -500/230kV Transformers1 System Additions Stations

13. 03/22/07 ACC Open MeetingSummer Preparedness 200713 System Additions Lines ADDITIONSNUMBER - Pole Replacements620 - Rebuilt/Upgrade 69kV Lines 6.1 Miles - New Circuit Miles of 69kV Line20.6 Miles - Rebuilt/Upgrade 230kV Lines17.5 Miles - New Circuit Miles of 230kV Line9 Miles

14. 03/22/07 ACC Open MeetingSummer Preparedness 200714 System Preparation Transmission and substation maintenance and training will be complete by summer. This includes: –Line patrols/inspections –Preventative maintenance –Pole re-enforcement –Pole change-outs/ upgrades –Wildfire coordination –Tree trimming –Cable replacement –Storm planning –Emergency procedure training –Blackstart training

15. 03/22/07 ACC Open MeetingSummer Preparedness 200715 Facilities identification and location Direct communication between SRP and Agencies SRP Advisor Representative on-site Firefighting safety information Participate in State Drill and Southwest Mutual Assistance Committee SRP/Wildland Fire Coordination

16. 03/22/07 ACC Open MeetingSummer Preparedness 200716 SRP Electric Facility Firefighting Support development of Pre-Plan Information for each facility. Provide Emergency Contact Information for each facility and responding firefighters. Integrate SRP representatives into Incident Command System management. Provide firefighter electrical safety awareness and facility orientation training.

17. 03/22/07 ACC Open MeetingSummer Preparedness 200717 Arizona EHV Transmission Systems Glen Canyon Parker Davis Phil Young (Greenlee) HaydenCraig Palo Verde Cholla Mohave Coronado Springerville Kyrene Four Corners Navajo San Juan To Miguel To Devers Silver King North Gila Saguaro Mead Moenkopi Westwing El Dorado Mc Cullough Marketplace Pinnacle Peak Liberty Shiprock South Vail TO NEVADA TO CALIFORNIA TO UTAH TO NEW MEXICO TO COLORADO TO PHOENIX AREA TO TUCSON AREA TO NEW MEXICO TO UTAH NEW MEXICO ARIZONA MEXICO COLORADO UTAHNEVADA CALIFORNIA NorthNorth Browning Hassayampa Jojoba Rudd Electrical Substations Coal Generation Hydro Generation New Gas Generation

18. 03/22/07 ACC Open MeetingSummer Preparedness 200718 Distribution Summer operating procedures reviewed and refresher training provided to O&M personnel. Six mobile substation transformers are available for service if needed. If required, the process for implementing rotating outages has been automated. –The planned sequence of substation outages and the duration of each outage is the same as in the past.

19. 03/22/07 ACC Open MeetingSummer Preparedness 200719 Summary of Year 2007 Projected Conditions Transmission, SRP generation and planned energy purchases are adequate to serve the forecasted year 2007 demand. Wildfires are our biggest concern. Contingency plans are in place to handle emergency events.

20. 03/22/07 ACC Open MeetingSummer Preparedness 200720