Profiling Working Group 1 PWG Update Report By Ernie Podraza of Direct Energy ERCOT PWG Chair Ed Echols Of Oncor ERCOT PWG Vice Chair for COPS Meeting September 14, 2010

Profiling Working Group 2

3 To: Subject: M-B ERCOT to adjust Coast Weather Zone Load Profiles NOTICE DATE: September 26, 2008 LONG DESCRIPTION: In accordance with PUC Project No (Issues Relating to the Disaster Resulting from Hurricane Ike), ERCOT will be adjusting all Load Profiles for the Coast Weather Zone used for aggregating load starting with Operating Day September 13, 2008 and continuing forward until further notice. These adjusted Load Profiles will first be reflected on the Initial Settlement of Operating Day September 18, Adjustments for Operating Days September , 2008 will be reflected in the Final Settlement for these Operating Days. Would ERCOT know ahead of the storm if such an adjustment would occur again? PUCT Project No – Active or Not?

4 1)LPGRR038 Revisions for Texas Nodal Market Implementation and Synchronization with PRR821, Update of Section 21, Process for Protocol Revision; TAC approved effective Oct. 1, )LPGRR039 Revisions for Texas Nodal Market Implementation Part Two. TAC approved effective Oct. 1, )LPGRR040 - Administrative Changes for October 1, 2010 Load Profiling Guide; Submitted by Market Rules. If no comments from interested parties then effective Oct. 1, )LPGRR draft to place the LRS TDSP CSV Operations Guide in Appendix A of the Load Profiling Guide (LPG), and 5)One Draft LPGRR including language; a) Per NPRR208, Registration and Settlement of Distributed Generation (DG) Less Than One MW (Goal 6), b) On valid profile id assignment not in settlement to improve settlement system processing time, c) To clarify IDR and AMS weather sensitive type code assignment, and d) Per NPRR250 Suspension of Annual Profile ID Validation With Advanced Meter Deployment (Goal 3). LPGRR and NPRR / PRR Status

5 Annual Validation Business are currently indicated to have a provisioned Advanced Meter.

6 UFE 2009 ANALYSIS Compiled by Load Forecasting & Analysis for the PWG Meeting of August 25, 2010

7 STATISTICAL SUMMARY  SR11a - Lowest STD DEV - less positive since 2005

8 STATISTICAL SUMMARY  SR11b - Lowest STD DEV - Lowest Mean - Lowest Medium

9 STATISTICAL SUMMARY  SR12 a - Lowest STD DEV

10 STATISTICAL SUMMARY  SR12 b - Lowest STD DEV - Lowest Mean - Lowest Medium

11 STATISTICAL SUMMARY Protocols Guidelines for Development of Load Profiles In developing Load Profiles, ERCOT shall strive to achieve an optimal combination of the following: … (3) Minimize the Load Profiles’ contribution to Unaccounted for Energy (UFE) over all Settlement Intervals, paying particular attention to higher cost periods; UFE improvement is thanks to many Market Participants!

12 Round 2 Sample PWG Discussions (Goal 8) Previous PWG Discussions Preliminary slides of sample vs. current profiles shown at the 3/24 PWG Mtg. Comparison of round 2 sample vs. current profiles shown at 5/26 PWG Mtg. Comparison of round 2 sample vs. current profiles shown at 6/24 PWG Mtg. The PWG via polled the members for feedback; full report and latest evaluation at 7/28 PWG Mtg. PWG shall review in September the latest evaluation pending discussion at the August 10 COPS Mtg. At the May 26, 2010 PWG meeting the Market Participants ruled out changing the Load Profile Model Structure. The PWG via second polled the members of COPS and RMS for feedback; full report and latest evaluation at 7/28 PWG Mtg.

Polling Question (Round 2 Sample cont.) Do you wish to: (A) Leave Current Models (as is) (B) Refresh current model coefficients or (C) Other with your explanation? Reference; 1st from Ernie Podraza to PWG and COPS on 6/29/2010 Subject: PWG Poll Action Item - Load Profile Round 2 Refresh 2nd from Ernie Podraza to PWG, RMS and COPS on 8/11/2010 Subject: Re: PWG Poll Action Item - Load Profile Round 2 Refresh - Second Request 13

1 st Poll Results (Round 2 Sample cont.) Seven (7) responses (from 5 companies) for Option A – Leave current models as is. Two (2) responses for Option B – Refresh model coefficients. One (1) Option C – Neutral. 14

2nd Poll Results (Round 2 Sample cont.) 15 Seven (7) responses (from 5 companies) for Option A – Leave current models as is. No Change in number of votes Three (3) responses for Option B – Refresh model coefficients. One additional vote Four (4) responses (from 3 companies) for Option C – Neutral or Abstain. Two additional votes Note ERCOT Staff supports Option A - As Is

As IS vs. Refresh Coefficients (Round 2 Sample cont.) Previously Presented Leave Current Models As Is because: –resources needed for NODAL go live, – overall improvement of new coefficients appears marginal, –advanced metering is replacing NIDR Load Profile settlement, and –do not wish to allocate resources on a transition plan. –ERCOT after Nodal Go Live would not need to budget a project above the line for ERCOT system changes for transition plan. –Market Participants would not need to recalibrate pricing models, forecast models, and balancing market hedge positions. –Review again after Nodal Gray box implementation, Stabilization period and post go live system issues. 16

As IS vs. Refresh Coefficients (Round 2 Sample cont.) Previously Presented Refresh Model Coefficients because: –ERCOT’s Round 2 Load Study provides an improved sample of CNP meter points over the Round 1 Load Study (half sample). –ERCOT PWG analysis indicates significant MAPE reduction and the potential for greater UFE reduction. –CNP’s Round 2 Load Study data appears to yield improved UFE results for CNP based on internal CNP customized application of Houston area weather data. –Updating model coefficients with Round 2 Load Study data allows the market to apply revised load shapes during market settlement when AMS data is unavailable or insufficient. 17

CNP Comments (Round 2 Sample cont.) Previously Presented CNP considers option A (As IS) as a short-term and partial solution until Nodal implementation and market-wide AMS deployments are completed in Conditions for CNP’s acceptance of option (A) is dependent on the following additional analysis: a. ERCOT review of impacts of Round 2 Load Study data on estimation of coincident peak demand (4CP) values for market settlement, and b. ERCOT review of selection and weighting of weather station inputs for CNP service area to gain UFE improvements. 18

As IS vs. Refresh Coefficients (Round 2 Sample cont.) Leave Current Models As Is because: –4CP calculations would not be affected until summer of 2012 –Earliest implementation would be 4 th quarter 2011 –By end of 2011 about 2/3 of the market has AMS meters –Sample data shall be two years old for a much smaller population by the time the new models can be implemented –AMS mitigates UFE in the interval of use making AMS meters far more effective to reducing UFE variance than recalibration of model coefficients –Refreshing Model Coefficients would require a budget project and prioritization. 19

As IS vs. Refresh Coefficients (Round 2 Sample cont.) Previously Presented How well do the Round 1 (current) models estimate the Round 2 means? –The average MAPE overall for all days is 8.5% –The average MAPE for the CP days is 6.7% –The average MAPE for the high UFE days is 9.3% MAPE = ABS(backcast-LRS_Mean)/LRS_Mean *

As IS vs. Refresh Coefficients (Round 2 Sample cont.) Latest Presentation Location with all the latest graphics 2_LRS_Additional_Evaluations_072810_v2.ppt MAPE = ABS(backcast-LRS_Mean)/LRS_Mean *

Summary for All Intervals Summary for All Intervals (Round 2 Sample cont.) Previously Presented 22 RESHIWR, RESLOWR, BUSHILF and BUSMEDLF profiles for NCENT, COAST and SOUTH weather zones are at or below total mean of 8.5% where load is most concentrated except for 2 of the 12 cells.

Summary for 4CP and High UFE Days Summary for 4CP and High UFE Days (Round 2 Sample cont.) Previously Presented 23

Provisioned AMS Meters after 2 nd Quarter 2011 Provisioned AMS Meters after 2 nd Quarter 2011 (Round 2 Sample cont.) Previously Presented 24 TDSP Estimates 2,043,000 Oncor 1,132,241 CNP 285,000 AEP/TCC 107,000 AEP/TNC 57% AMS of total ERCOT 6 Million meters

Vote 25 There is no consensus in the PWG on refreshing the current ERCOT Load Profile Models so the PWG requests COPS decision; Which should be done going forward Option 1 – As Is or Option 2 – Refresh ERCOT Load Profile Models

Profiling Working Group 26 PWG 2010 meeting dates - 4th Wednesday of the month The September meeting shall be a full day with new LPGRR drafts to discuss.