Customer Dedicated Solar

Texas Community Solar Community Solar is designed to provide access to solar energy for all customers, and to allow greater participation in renewable energy than what is provided by EPE system resources Private solar is not an option for about 75% of residential customers Renters and Homeowners with inadequate roof space (size, orientation, shading, etc.) Due to financial limitations Local solar PV projects are developed to supply the program, providing visibility and awareness

Program Basics Basics: Target Residential and Small Commercial/local government) Limit capacity to larger customers (1 MW) Voluntary program Portable within EPE service territory by jurisdiction Key Program Considerations: Easy to understand / easy to bill Meet customer desires for options Long-term contract options

Subscription Model Customers select PV capacity blocks (1 kW minimum, 0.5 kW increments), limited by their energy requirements in peak solar months Customer pays for solar capacity at a tariffed rate (e.g., $20 per kW monthly) Price is based on the full cost of solar generation facility or facilities Customer receives a generation credit for kWh produced by their capacity subscription (based on actual output of facility) Credit reflects average EPE production cost (w/fuel)

Program Elements Contract length Year-to-year contracting, customer cancel on annual anniversary Multi-year contracts available with upfront payment at discounted rate* Provisions for early cancellation of long-term Contract Portability Transferable between accounts in service territory, not assignable Visibility in community (onsite education center, online tracking of system output, etc.)

Key Points Community Solar customers continue to pay all grid related charges (T&D) Community Solar subscribed energy acts as a long term hedge against fuel cost and other system production costs Solar energy capacity costs may decline over time if additional facilities are constructed at lower cost, but will not increase The generation credit will change over time with system capacity additions (set in rate cases) or due to fuel costs

Holloman AFB - Background EPE and Holloman AFB engaged in discussions regarding an existing 10-year power contract approved by the PRC under EPE’s load retention rider Holloman AFB elected to submit a sole source contract with EPE for a solar generation facility EPE requested and received authorization for a CCN for a 5-MW solar facility that EPE would own and operate on Holloman AFB property

Holloman AFB - Contract A retail sales agreement between EPE and Holloman AFB provides that Holloman’s retail load will be provided through – An existing WAPA allocation Purchase of the entire output of the Holloman solar facility Retail service by EPE under the applicable tariff Output of Holloman solar facility is priced at full cost of the facility, including financing costs Holloman AFB receives a demand-based credit for allocated production costs