1. DSWG Update to WMS 8/10/2011

2. DSWG Goals #DSWG GoalDeliverable Target Date Primary Owner Team MembersStatus 1SCED Load Participation Complete analysis of issues and develop business requirements and a draft NPRR End of 3rd Quarter John Varnell Mark P, Tim C, Jay Z, Eric G, Mark S, Floyd In Progress 2 Review CAISO RDRP and identify potential parallel effort that could take place in ERCOT Report to DSWG on feasibility and scope End of 3rd Quarter Paul W. 3Advance Notice of Real Time Energy Prices Analyze potential solutions and report on feasability End of 4th Quarter Mark Smith All Moved to QSTF 4 NERC Issues (Functional Model WG, DADS, CIP Standards for UFLS) Monitor and Report to DSWG End of 4th Quarter Paul Wattles John Varnell In Progress 5 Explore opportunity to deploy EILS via XML (or other electronic messaging) Identify issues, cost, timelines End of 3rd Quarter Bob P ERCOT Staff 6EILS ImprovementsEILS Subgroup Report to the DSWG End of 4th Quarter Alberto Marinez All In Progress 7 Greater participation of small and midsize loads in ERCOT markets. Identify potential opportunities and any barriers to entry; Report to WMS End of 4th Quarter Jay Z Robert H., Eric G, Tim C, ERCOT staff In Progress 8 Investigate Load Participation issues with Nodal Market Implementation( e.g. NOM updates, outage impacts) Identify Issues, develop potential solutions and report to DSWG and WMS On-GoingTim Carter Mary Anne, Nelson, ERCOT staff 4CP and Price Responsive Load AnalysisReport and Presentation to the DSWG Defer to sometime in 2012 Next meeting on 9/30/2011 (high chance of being moved up)

3. LR/EILS Event 8/4/2011 – LR and EILS deployed More inline with expected EILS event – Unfolded gradually – Limited duration LRs dispatched first - will likely change with NPRR379 LRs recalled first No firm load shed LREILS 880 MWs434 MWs 14:30:45 through 17:51:2015:42:04 through 18:07:58 16:03:04 through 18:07:58

4. AMIT/DSWG Workshop Aug 30 th and 31 st here at Met Center Smart meters and DR – What are barriers to DR participation? Agenda near completion Morning of 30 th AMIT update DSWG Update ERCOT overview Afternoon of 30 th Vendor presentations (technology, analytical services) REPs Morning of 31 st Facilitated discussion

5. Load Resources in SCED (LRIS) What we are trying to do: Demand response offers economically dispatched by SCED for energy or as ancillary resource similar to generation resource today

6. Load Resources in SCED (LRIS) Why are we doing this? Helps cure unintended consequence of price suppression when DR is dispatched during shortage conditions Price certainty to loads to loads responding to price Enables greater load participation in the market Increasing reliability and market competition by adding additional resources available to SCED

7. Load Resources in SCED (LRIS) Key issues: Settlements M&V algorithms Dispatch methodology Aggregated Loads – Network modeling

8. Load Resources in SCED (LRIS) Choices: Settlements – Option 1 – “Volumetric Flow” Same as “LMP – G” Value is difference between high energy cost and retail rate Provides separate channel of curtailed usage to REPs – Option 2 – “Full LMP” Pay full LMP for curtailed usage Value is energy payment and avoided costs

9. Load Resources in SCED (LRIS) Choices: To include in initial project: – Option 1 – Individual Resources Much simpler – Option 2 – Include aggregations SB1125 Possibly more Resources

10. Load Resources in SCED (LRIS) Suggestions from DSWG: Looking for endorsement and direction from WMS on where this goes from here – Expect ROS involvement at minimum – Suggest ERCOT look at as part of “Look ahead SCED” project