1. Long Term Solution Task Force TAC Report 5/5/07 Presented by: Bob Wittmeyer - LTSTF Co-Chair

2. PUC Directed Charge The rule specifically requires the market participants to identify alternatives that are defined as long-term solutions. Any long-term solution must offer ERCOT the ability to avoid shedding firm load by bringing more resources online or curtailing load voluntarily. The rule specifically requires the market participants to identify alternatives that are defined as long-term solutions. Any long-term solution must offer ERCOT the ability to avoid shedding firm load by bringing more resources online or curtailing load voluntarily. In this context, the PUCT is interested in the following: In this context, the PUCT is interested in the following: Better price signals leading up to an Emergency Electric Curtailment Plan (EECP) event; Better price signals leading up to an Emergency Electric Curtailment Plan (EECP) event; Bringing more resources (both interruptible load and generation) online through existing ancillary services; and Bringing more resources (both interruptible load and generation) online through existing ancillary services; and Examining the priorities set by transmission/distribution service providers when shedding firm load. Examining the priorities set by transmission/distribution service providers when shedding firm load.

3. Request from LTSTF Co-Chairs Firm Load shedding and setting specific priorities by line, is not a market function, it is purely a reliability function. Firm Load shedding and setting specific priorities by line, is not a market function, it is purely a reliability function. We therefore request that WMS ask ROS review the PUCT Charge of: We therefore request that WMS ask ROS review the PUCT Charge of: Examining the priorities set by transmission/distribution service providers when shedding firm load. Examining the priorities set by transmission/distribution service providers when shedding firm load.

4. Long Term Solution Task Force Concerns have been raised over uncertainty related to changing the current program. Concerns have been raised over uncertainty related to changing the current program. Concerns have been raised over doing nothing and hoping we will at least get to the threshold participation in June. Concerns have been raised over doing nothing and hoping we will at least get to the threshold participation in June.

5. Solutions Currently Under Consideration Increasing Responsive Reserve Increasing Responsive Reserve Administratively Set EECP Prices Administratively Set EECP Prices Incentives for loads interrupting at predefined prices Incentives for loads interrupting at predefined prices Direct Load Control by ERCOT Direct Load Control by ERCOT

6. Next Steps Meetings Meetings 6/5 ERCOT Met 168 - 9:30-3:30 6/5 ERCOT Met 168 - 9:30-3:30 Meetings contemplated bi-weekly after 6/5 Meetings contemplated bi-weekly after 6/5 Email address for the list serve function on the ERCOT website: http://lists.ercot.com/cgi- bin/majordomo. Email address for the list serve function on the ERCOT website: http://lists.ercot.com/cgi- bin/majordomo.http://lists.ercot.com/cgi- bin/majordomohttp://lists.ercot.com/cgi- bin/majordomo The task force email address is: longtermsolutionstf@lists.ercot.com. The task force email address is: longtermsolutionstf@lists.ercot.com. longtermsolutionstf@lists.ercot.com