Retail Market Update November 6, 2003

2004 Flight Time Lines Retail market has several market occurring in the second quarter Flight 0304, GISB 1.6 testing and implementation and certifying all CRs to send disconnect/reconnect service orders. Potential exists for resource constraints and negative impact to market Objectives from competing activities. RMS’ Testing Working Group and PUCT Staff are exploring alternatives and RMS will review those alternatives next week.

2004 Flights Time Line Flight V New CRs JanFebAprJunMayMarAugJulySeptOctNovDec Flight V New CRs August 1, 2004 RMS Approved production roll out date for Version 2.0, including MIMO and Stacking transaction changes /09/04 Flight Kickoff 2/20/04 Flight Ends 6 Wk. Test Flight Notice 1/6/04 3/12/04 Flight Kickoff 4/23/04 Flight Ends Flight Notice 3/5/04 5/14/04 Flight Kickoff 10 Wk. Test Flight V New CRs Flight Notice 7/7/04 9/10/04 Flight Kickoff 10 Wk. Test 7/23/04 Flight Ends Flight V All Market Participants 11/19/04 Flight Ends

Annual Profile Update

IDR Removal Option RMS is exploring business issue when a new customer moves into a premise with an IDR meter when the new customer’s load will not exceed 1 MW. We are also exploring when an existing IDR customer significantly changes their operations when their forecasted load will not exceed 1 MW. More research and debate is needed before RMS approves a PRR.

COMET Time Lines COMET Guides are under development to support support January 1, 2004 Competitive Metering date. Approval time is as follows to achieve January COMET distributes Guides by October 10, 2003 DONE Comments due to COMET by October 23, 2003 DONE COMET discusses/resolves comments by October 29, 2003 DONE COMET issues second draft of Guides by October 31, 2003 DONE PUCT approves T&Cs for docket on November 5, 2003 COMET issues final draft based on T&Cs by November 7, 2003 RMS resolves only unresolved issues on November 13, 2003 TAC approves on December 4, 2003 meeting ERCOT Board receives approved Guides on December 16, 2003 Competitive Metering for commercial customers for meter ownership effective January 1, 2004.

COMET Time Lines There is a potential the Competitive Metering Guides will under go two review cycles. First cycle to review market comments in preparation for January This version approved before January Second review cycle after T&Cs and Meter Agreement are approved. This version might be approved after January 2004.

Transaction Clean Up There are several transaction and data clean up efforts underway involving most of the market. Safety Net Requests Missing Customer Cancels Data Extract Post Texas SET V1.5 Pre Texas SET V1.5 Fas Trac Day-To-Day Transaction Data Clean-up Etc.

Data Extract Direction RMS received a report from data extract workshop on the time lines for several extract scenarios. RMS approved to establish a 75 calendar day deadline for completion of each issue and each MP (including ERCOT) will complete the Data Extract Variance Process in accordance with the timelines and other requirements of the DEV Manual. CRs are developing reporting templates to report RMS the market’s success in achieving each portion of the 75 calendar day deadline.

Texas Market Link Desired results would be to decreased costs associated to retail processes due to increased efficiency for both exception processing and more more pro-active business decisions. Retail market has identified a number of changes to the portal to provide additional functionality or performance. 63% of the suggestions are quick-hitters and can be delivered in April ERCOT is activity working through the steps to launch this project.

MIMO Stacking Update All is on track. Retail market continues to hold coordination meetings to ensure CRs, TDSPs and ERCOT on the same page and time lines. Testing scripts and plans are under development along with a great deal of work at each market participants organizations. Implementation remains August 2004.