Notrees Presentation – ERCOT Integration workshop Slides for Registration/Integration challenges

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Notrees Battery Storage System 36 MW / 24 MWh output Technology: Advanced lead-acid Dynamic Power Resource OEM Partner – Xtreme Power (XP) 24 Dynamic Power Modules with 1.5 MW / 1.0 MWh rating Modules housed in ~ 6,000 sq. ft. building  Construction began in October 2011; fully operational Q  Potential areas of operation:  Frequency Regulation  Energy Arbitrage  Voltage Support  Wind Firming  Curtailment Mitigation  Other Ancillary Services (Non- Spinning Reserve, Black Start)

Registration of new Storage resource Year-long registration process Primary source of revisions/discussion on how to ‘fit’ Storage technology into existing framework for ‘conventional’ resources Ongoing ERCOT/Duke/ XP meetings

Limitations of existing Registration/Integration process Issue 1: Resource Modeling Challenge: x1 Physical Asset, but ERCOT systems see x2 Resources - x1 Gen Resource (GR) and - x1 Load Resource (LR) Outcome: Operating duplication & complexity  Separate GR and LR qualifications  Telemetry allocation to identify 'Gen Resource' mode and 'Load Resource' mode  Complex control system functions to ensure RT consistency between modes  Separate GREDP/Performance obligations  How to avoid 'double-counting' in ERCOT market operations processes  Settlement treatment (addressed via PUC rule implementation) 5

Limitations of existing Registration/Integration process Issue 2: Standardized Registration & Qualification formats Challenge: Standardized RARF information requirements incompatible with operating frameworks for inverter-based Storage technologies, e.g.  Planning Data  Protection Data  Operating Parameters Outcome: Numerous "errors" and "rejections" throughout registration process  Source of automatic registration delays & much discussion  Provision of system-specific technical information to identify performance characteristics 6

Limitations of existing Registration/Integration process Issue 3: Alignment of existing operating procedures with alternative operating characteristics Challenge: Existing performance requirements designed around installed capabilities Outcome: Potential to limit capabilities of technology, e.g.  Static requirements on Voltage support, Frequency response limit the range of performance available from new types of resources Issue 4: Unfamiliar Commissioning activities Challenge: Project requirements in advance of Operations unfamiliar territory for System Ops e.g.  'Cycling' of batteries to maintain battery health during construction/commissioning  Inverter testing requirements Outcome: Developer must ensure that Site activity is 'visible' from early stage 7

Issue 5: Co-location of different asset classes Challenge: Key role for Storage to support other Resource operations and enhance overall grid management – but compounds registration, testing & modeling challenges presented by existing process… Outcome: Additional layer of complexity for both Storage and co-located resource 8 Limitations of existing Registration/Integration process

Areas Previously Identified by ERCOT 9