1. Houston Import Evaluation Cross Texas Transmission & Garland Power & Light ERCOT RPG Meeting August 27th, 2013

2. Agenda Houston Import Needs Discussion
GP&L/TMPA Affected Facilities – Existing N-H corridor
Impact of N-H import/solution on Gibbons Creek
Additional Considerations
Transmission Options Studied
Preferred Options

3. Houston Import Needs Discussion
Base case reliability need observed for Houston import for 2018
Thermal overloads under N-1 + G-1 conditions observed to be key drivers for the reliability need
N-H transfer levels modeled at 3100 MW for the 2018 study case
Houston Import reliability needs and long-term effectiveness of proposed solutions sensitive to the following
N-H transfer levels
Generation availability within Houston and along the N-H import path
Long term Houston load deliverability may require significant re-conductor and/or upgrades of existing N-H corridors
Important consideration when evaluating feasibility of import options

4. GP&L/TMPA Affected Facilities – Existing N-H Corridor
Significant history of anticipated congestion on existing N-H corridors across various ERCOT Houston Import study efforts
ERCOT Houston Import Study Update (April 2010) – “2014 benchmark case showed heavy congestion on Singleton-Zenith 345-kV line for the contingency loss of Roans Prairie-Kuykendahl/ Singleton-Tomball 345-kV double circuit. Congestion also observed on Jewett-Singleton and Twin Oak-Jack Creek 345-kV lines”
ERCOT 2012 Long Term Study (LTS) – Scenarios of Interest from Houston Import standpoint
Scenario #2: Base with All Tech and Retirements (retirement of legacy natural gas-fired generators)
Scenario #3: Base with All Tech and Incremental Wind

5. GP&L/TMPA Affected Facilities – Existing N-H Corridor
Significant history of anticipated congestion on existing N-H corridors across various ERCOT Houston Import study efforts (Contd.)
ERCOT 2012 Long Term Study (LTS) – Scenarios of Interest from Houston Import standpoint
Scenario #5-a: Drought Scenario
Summer capabilities of existing water – consuming resources de-rated
Increased peak load
Scenario #7: BAU – Hi Natural Gas
Characterized by a high natural gas price ($9.55 by 2016, $13.7 by 2022)
Resources retire in 2018 and 2022 for competitive reasons

6. GP&L/TMPA Affected Facilities – Existing N-H Corridor
Estimated Congestion Costs, N-H Constraints, ERCOT LTS Effort
Source: ERCOT DOE Long Term Study (ERCOT POI Site)

7. GP&L/TMPA Affected Facilities – Existing N-H Corridor
Houston Import, Congested Elements, ERCOT LTS Effort

8. GP&L/TMPA Affected Facilities – Existing N-H Corridor
2015 & 2017 Projected Economic Constraints, ERCOT C&N Report 2012
(Source: ERCOT 2012 Constraints & Needs Report)

9. GP&L/TMPA Affected Facilities – Existing N-H Corridor
All ERCOT Houston Import evaluations indicative of significant anticipated congestion on existing N-H corridor
Two key GP&L/TMPA facilities part of the congestion constraints
345kV Gibbons Creek – Twin Oak
345kV Gibbons Creek - Singleton
Avoiding congestion (and overloads) on existing N-H corridors will provide significant cost savings to Houston region
Provides significant economic benefits to any Houston reliability project
Prevent the need to take additional outages to re-conductor 345kV lines along an already congested N-H corridor
Critical aspect to be taken into account when evaluating import project options

10. Houston Import – Impact on TMPA/GP&L Facilities
Need to alleviate congestion/potential overloads on TMPA/GP&L transmission facilities in existing N-H corridor as part of Houston Import
Need to ensure that potential Houston import solutions divert enough power from existing N-H corridors
Looping N-H projects via intermediate stations
South – Houston projects with large enough transfer capability to offset flows from the north
Direct solutions with series compensation
Transmission solutions looped through existing TMPA facilities may exacerbate over-voltage issues under light load conditions
TMPA RPG approved project for MVAR reactor on 345kV Gibbons Creek expected to address this issue

11. Additional Considerations
Recent history of Gibbons Creek unit being requested to provide VAR support during high N-H transfer levels (at the cost of active power to TMPA member cities)
Gibbons Creek unit exempt from PRR830 requirements
Gibbons location significantly strong with little ability of external reactive equipment impacting voltage downstream
Optimal approach would be to reduce impedance between Gibbons & Houston thereby improving voltage conditions in the region
Ability to reduce the “N-1” impact created by the proposed solution itself
Important to ensure that the proposed solution does not become the single largest contingency for Houston import
Utilize existing infrastructure and expansion capability to reduce the reliability impact for the outage of the proposed option

12. Transmission Options Studied
(Source: CTT/GP&L Houston Import RPG Submission)

13. Preferred Options Preferred Options, Houston Import Study
(Source: CTT/GP&L Houston Import RPG Submission)

14. Preferred Options
Test Project
2022 capital cost ($M)
Reliability benefit of test project ($M)
Capital Cost Adjusted for Reliability Benefit ($M)
Production Cost Savings ($M)
1/6 of Capital Cost ($M)
1/6 of Adjusted Capital Cost ($M)
Meet ERCOT Economic Criteria ?
Limestone-Gibbons Creek-Zenith
268.4
120.6
147.8
36.6
44.7
24.6
Yes
Watermill-Big Brown
208.2
23.1
185.1
0.1
34.7
30.9 No
Lake Creek – Navarro
104.1
42.1
62.0
1.7
17.3
10.3
Lake Creek – Watermill
297.4
19.0
278.4
0.4
49.6
46.4
Clear Spring - Hill County
0.0
4.1
17.4
Hays - Kendall second 345kV circuit
41.8
3.2
7.0
Sandow - Garfield
133.8
4.0
22.3
ERCOT LTS Scenario 3, 2022 Economic Project Assessment

15. Preferred Options 345kV Limestone – Gibbons Creek - Zenith
Most optimal performing option in terms of incremental Houston import capability vs project cost (across options providing greater than 2500 MW Houston import capability)
Houston import capability observed to be as high as 3000 MW with MLSE upgrades on TMPA N-H facilities
Virtually no need to upgrade existing N-H corridor to achieve import capability
Flexibility to achieve close to 3500 MW Houston import capability with upgrades on N-H corridor in long term
Deemed economic via the ERCOT LTS Study for 2022 (S3) with significant reliability benefits ($121M)
Provide all the benefits stemming from Gibbons Creek – Zenith
Limestone provides access to significant generation in the North

16. Preferred Options 345kV Gibbons Creek – Zenith
Provides close to 2000 MW of Houston import capability at significantly high MW/$M
Requires comparatively less upgrades on existing N-H corridor to achieve Houston import capability level
345kV Gibbons Creek – Tomball
Provides close to 2200 MW of Houston import capability at significantly high MW/$M
May require reactive equipment enforcements in the long term to result in Houston import levels greater than 3000 MW

17. Questions/Discussion