1. ©2003 PJM North American Markets Status APEx Seoul, Korea October 29-31, 2006 Kenneth W. Laughlin

2. 2

3. 3 AESO Peak Load 9600 MW, December 2005 Postage Stamp Transmission Pricing –No significant transmission constraints Full Retail Access –Regulated Rate Option available to small consumers Energy Only Market –No plans to implement capacity market

4. 4 California ISO Peak Load 50,270 MWs Zonal energy market with redispatch to manage congestion within zones Comprehensive market redesign in progress – expect to move to nodal pricing in 2007 Resource adequacy requirement on load serving entities to demonstrate 115% of load can be met; capacity markets under discussion

5. 5 ERCOT Peak Load 62,400 MWs 85% of Texas; Not subject to FERC; 3 DC Ties 37,000 miles of Transmission Firm Transmission (PTP only) 77,000+ MW of Generation Centralized registry for 5.9 million retail choice customers Nodal pricing in 2009; energy only

6. 6 MISO RTO Peak load 136,520 MWs Market opened 1 April 2005 Full nodal real time and day-ahead energy markets Territory encompasses fifteen states and one Canadian province Simultaneously co-optimised energy & ancillary services markets under development No capacity market envisioned

7. 7 ISO New England Peak Load 28,000 MW Implemented nodal pricing in 2003 Implemented wholesale markets in 1999 Local Forward and real-time reserve markets New forward capacity market auction in February 2008 for capacity in June 2010 Major new transmission projects completed or under construction

8. 8 New York ISO Peak Load 34,000 MWs Full nodal pricing with real time and day- ahead energy markets Installed capacity market with a demand curve Co-optimized energy and ancillary services markets—in both day-ahead and real-time Scarcity pricing for reserves

9. 9 Ontario Market Operator Peak Load 26,000 MWs 5 minute wholesale spot market, single market clearing price Design of future Day-Ahead Market currently being discussed with stakeholders Development of new generation underway via centralized contracting to allow the shutdown of all coal plants as soon as possible

10. 10 PJM Peak load 145,000 MWs Full nodal markets (real time and day- ahead) Integrated five companies into market area between 2002 and 2006. Developing a new capacity market

11. 11 SPP Peak Load 42,227 MW, July 2006 Full nodal energy imbalance energy market expected to become operational in November 2006 Transmission Services market No retail open access in footprint

12. 12 North American Markets Peak LoadNodal pricingRetail Markets Capacity market AESO 9,600 NoYesFuture California ISO 50,270 2007No under discussion ERCOT62,400 future YesNo MISO136,5202005PartialNo ISO-NE28,0002003YesYes. New under development NYISO34,0001999YesYes. New under development Ontario Market Operator IESO 26,000NoYesFuture PJM145,0001998YesYes. New under development SPP42,2272006No Future