1. Electric Service Options April 19, 2002 Ken Mellor and Mike Bell

2. Presentation Topics Firm Overview SF LAFCO Services Project Approach Key Personnel Related Experience Fees & Costs The R. W. Beck Advantage

3. Firm Overview National consulting engineering firm 3 California offices, 16 nationwide 60 year old privately held corporation 500 employees, diverse disciplines, extensive experience Recognized as experts in municipal electric utility operations Performed more municipalization related studies than any firm in existence today Unbiased, independent, and professional, regardless of the profile or contentiousness of the assignment Capabilities include full-range of energy, water, wastewater, telecommunications, and solid waste services

4. Representative Energy Capabilities Strategic advisory & competitive positioning Independent engineering Construction management Owner's engineering & advisory Resource planning, portfolio optimization Pricing, rates, & economic analyses Mergers, acquisitions, & divestitures Appraisals & valuations Municipalization advisory services Power market pricing & assessments Expert testimony & litigation support Environmental services & permitting Resource site selection & evaluations Distribution/transmission planning & feasibility studies Integrated resource planning Demand side & conservation evaluation Resource integration fatal flaw analysis Development of resource interconnection alternatives Distribution/transmission constraint evaluations Congestion management dispatch analysis Distribution/transmission upgrade impact analysis & cost estimates Distribution/transmission loss analyses Program & construction management Hydroelectric services Distributed generation Consumer direct access Risk management Efficiency & benchmarking studies Public benefit program evaluation

5. SF LAFCO Services Phase I Public Hearing Support Risk/Benefit Analysis Strategic Options Development

6. Risk/Benefit Analysis Example East Bay Municipal Utility District Probability vs. NPV Savings ($000) 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% (1,000,000)(800,000)(600,000)(400,000)(200,000)-200,000400,000600,000800,0001,000,0001,200,000 Probability Savings ($000) Losses ($000)

7. SF LAFCO Services – Cont. Phase II Proceed at SF LAFCO’s option Customized to the City and County of San Francisco’s needs Performed by a team of R. W. Beck experts in close consultation with SF LAFCO personnel Detailed scope of work and budget developed collaboratively with SF LAFCO

8. Project Approach Select strong project manager to direct assignment. Identify experienced team to support project manager and undertake specialized tasks. Maintain strong Quality Assurance/Quality Control by utilizing expertise of national director. Employ systematic approach to completing assignment in timely and cost-effective manner. Provide regular feedback and maintain close coordination with SF LAFCO personnel.

9. Key Personnel Project Management Responsibility Mike Bell and Ken Mellor will serve as the team’s Co-Project Managers and the primary contacts for SF LAFCO. Mike Bell is R. W. Beck’s Senior Director of Client Services and manager of the firm’s three California offices. He has 20 years of technical and managerial experience in the utility industry. Ken Mellor is a Principal and Senior Director of Consulting for R. W. Beck and has 37 years of utility related experience, including 23 with the Sacramento Municipal Utility District 10 of which as the Chief Financial Officer.

10. Key Personnel – Cont. Quality Assurance/Control Responsibility Mr. Tim Corrigan, Principal and National Director of R. W. Beck's management consulting practice will serve as the project’s Quality Assurance/Control Advisor. He will help develop project strategy, review work products to ensure quality standards, and otherwise help facilitate the successful completion of the assignment. He is a widely recognized expert on municipalization and has worked on related assignments with the Cities of Wichita, Kansas; Las Cruces, New Mexico; and New Orleans, Louisiana.

11. Key Personnel – Cont. Project Team Organization

12. Related Experience East Bay Municipal Utility District. Preliminary Feasibility Study on municipalization of electric service within the Utility District's service territory (East San Francisco Bay). Co-Project Managers: Mike Bell and Ken Mellor Port of Oakland. Review energy and supply options for the Port's aviation, maritime, and commercial recreation enterprises. Co-Project Managers: Mike Bell and Ken Mellor City of Fremont. Provide energy advisory and policy services. Project Manager: Ken Mellor City of Long Beach. Represented the city in 1999-2000 in its evaluation of the acquisition of Southern California Edison’s facilities within the city limits. Assisted the city in renegotiating its franchise with Edison. Co-Project Managers: Mike Bell and Ken Mellor

13. Related Experience – Cont. Other municipalization-related projects in California that R. W. Beck has completed are – Cities of Fresno, Delano, West Hollywood, Chino, Culver City, Alturas, Pasadena, and Redding Town of Los Altos Hills Counties of Monterey, Solano, and San Diego Irvine Ranch Water District Los Angeles Department of Water and Power San Diego County Water Authority Advisor to the law firms of McDonough Holland & Allen and DeCuir & Somach

14. Familiarity with Issues Loads and resources Hetch Hetchy Contracts SFPUC/SFDOE Electricity Resource Plan 2001 Municipalization Ballot Measure Bay Area environment Transmission and generation constraints

15. Fees & Costs R. W. Beck proposes to provide the referenced services to the SF LAFCO on a time-and-materials basis. Hourly rates and related projects costs consistent with expertise and industry standards. Detailed scope of work and budget for each Phase of the assignment R. W. Beck does not engage subconsultants without client approval.

16. The R. W. Beck Advantage Most comprehensive qualifications and experience Means no surprises Best analytic capabilities Critical to go/no decision Familiarity with Bay Area energy dynamics EBMUD, Palo Alto, Fremont, Los Altos Hills, Port of Oakland Reputation for objective independent analysis Accustomed to defending results of findings under-fire Corporate commitment to project team staffing and availability Maintains continuity and ensures close coordination Ready to formalize scope of work and begin assignment We know what to expect and are ready to go