1. PJM ©2007 NERC LTRA Workshop August 16, 2007 Paul McGlynn Manager, Transmission Planning Department

2. PJM ©2007 www.pjm.com 2 Ongoing and cyclical 15 year planning horizon Comprehensive and Holistic Collaborative Regional Transmission Expansion Planning Process

3. PJM ©2007 www.pjm.com 3 Regional Planning Process - Reliability 5 year10 year15 year Include all required upgrades at all voltage levels in RTEP 230 -345 kV new construction included in RTEP Identify 230 -345 kV new construction requirements and continue to re-evaluate each year 500 -765 kV upgrades included in RTEP Pursue Right-of-way acquisition for 500-765 kV projects Reliability Apply sensitivity analyses to reliability criteria

4. PJM ©2007 www.pjm.com 4 Uncertainty – What are the drivers? Load Growth Local Historical Weather and Load Data Local Econometric Forecasts Generation Received over 1000 interconnection requests since 1997 Received requests to interconnect over 200,000 MW since 1997 “S” Queue - closed on 7/31/07 124 projects Approximately 18,000 MW generation Deactivations Merchant Transmission Interconnection

5. PJM ©2007 www.pjm.com 5 Current Transmission Expansion Drivers Generation Retirements and Exports to NYC

6. PJM ©2007 www.pjm.com 6 500 kV Overloads

7. PJM ©2007 www.pjm.com 7 Allegheny Mountain Corridor Build a new 765 kV transmission line from the John Amos substation to Bedington substation and extend a twin circuit 500 kV line to a new substation in Kemptown near the Doubs- Brighton and Brighton- Conastone 500 kV lines. 15 year analysis shows that this alternative has the greatest impact on the overloads shown on the previous page. Expected in service: 6/1/12 Approximate cost: $ 1.8 Billion

8. PJM ©2007 www.pjm.com 8 500 kV Backbone Overload Reduction

9. PJM ©2007 www.pjm.com 9 Generation Sensitivities

10. PJM ©2007 www.pjm.com 10 Backbone Overload Sensitivity

11. PJM ©2007 www.pjm.com 11 Alternative Backbone Solutions Under Consideration

12. PJM ©2007 www.pjm.com 12 How do you manage the uncertainty? Incent development where you need it PJM Reliability Pricing Model Location specific Includes multiple resources Generation Merchant Transmission Demand Response Resources Situational Awareness – In the planning horizon Sensitivity Analysis – What if scenarios? Communicate with stakeholders