1. DISTRIBUTION EFFICIENCY UPDATE 1

2. Distribution Efficiency – Quick Review Tier 1 study (19 circuits) completed in 2011 – Four circuits identified for pilot (Mill Creek, Clinton substations) – Seven circuits had at least one unstudied adjacent circuit Identified influential circuit parameters for CVR Simplified Measurement & Verification Protocol for pilot 2012 savings target: 0 – 0.111 aMW (972 MWh) from pilot Planned Tier 2 study, circuit prioritization 2

3. PacifiCorp’s 2012 Activities Engaged in industry research – DSTAR (www.dstar.org) Project P13-7 (still in progress) Distribution Systems Testing Application and Research – NEETRAC (www.neetrac.gatech.edu) Project 11-136 (still in progress) National Electric Energy Testing Research and Applications Center Engaged in Regional Technical Forum (RTF) – Automated CVR Subcommittee & protocol development Review of applicable PacifiCorp standards Clinton and Mill Creek pilot projects Tier 2 study in Washington 3

4. DSTAR Findings 1.Demand :: Voltage relationship varies w/ feeder, time of day, season, and over the long term 2.Estimating circuit CVR factors from lab values (bottom up) cannot work (too little information) 3.Accurate long-term day on/ day off is extremely difficult 4.Increased frequency & severity of voltage sags 5.Software estimates may not suffice for M&V 4

5. NEETRAC Findings 1.Statistical analysis performed on pilot by Palmetto Electric Cooperative (SE South Carolina) – Could not apply RTF’s Automated CVR Protocol #1 due to limited data – 13 interested utilities participating in project 2.Demand :: Voltage varies w/ temperature, humidity, demand on previous day, and demand on same day of previous week 3.Must be analyzed on circuit by circuit and day by day basis 5

6. RTF Progress Currently two custom CVR protocols exist – Simplified VO M&V Protocol (Approved 5/2010) – Automated CVR Protocol #1 (Approved 4/2004) Both are under review for compliance w/ new (6/1/2011) RTF guidelines *, including: – A maximum error introduced by sampling – Sources stated for all assumptions – Results are reliable and sufficient to meet the needs of planners and “support regulatory processes related to the adoption and planning of energy efficiency initiatives.” * Guidelines are available at http://www.nwcouncil.org/Energy/RTF/Measures/Support/ 6

7. Questioning Protocol Assumption #1 Loads do not have to be distributed evenly? 7

8. Questioning Protocol Assumption #2 End-of-line voltage varies linearly with load? – Example from “Robustness of Simplified VO M&V Protocol Measurement Period of 7 Days” by Utility Planning Solutions, PLLC – If end of line voltage can be estimated by load, then several calculations can be “simplified” – The chart shown was derived from software, not actual reads 8

9. Questioning Protocol Assumption #2 Actual pilot measurements show low linear correlation  15-minute averages shown  Large (~ 2v) bandwidth for any given load  No model predicts this accurately 9 Substation MVA End of Line C phase voltage

10. Measurement & Verification Considerations Physics of individual appliance (lab test) well understood Physics of aggregate system not understood – Variables exist on every level, and they change over time Substantial assumptions have to be made for M&V – Pre- and post-reduction average voltage must be estimated for all customer locations, all year long – Energy response to voltage reduction must be estimated for all customers, all year long (VO or CVR factor) – To date, no way to determine accuracy of estimates over time Who can find a consistent, accurate, low cost method to determine energy savings from voltage reduction? 10

11. Review of PacifiCorp Engineering Handbook 1C.2.1 Voltage Level and Range June 2004 – High level look at ANSI service & utilization voltages 1C.2.2 Steady State Voltage Level Nov. 1998 – Settings methodology (§ 4.1.3 and § A4) is CVR 1C.3.1 Voltage Balance Nov. 1996 – Cites 3% maximum voltage unbalance as target – Accounts for economics, lowest total cost to customer and utility 1E.3.1 Distribution System Planning Study Guide Feb. 2000; minor updates Feb. 2012 – Discusses current unbalance, voltage unbalance, LDC settings, and capacitor location & settings in § 7.4, 7.8 and 7.11, and economics in § 8.3 Overall a good balance of economics and efficient system design Simplified Protocol states that standards become “entrenched” after three years 11

12. Clinton/ Mill Creek Pilot Using two 7-day test periods for M&V yields energy savings of ±0.54 aMW, before improvements were initiated. Example from 5Y610 (VO factor 0.446) :  Week of 6/25: average voltage = 122.8  Week of 9/10: average voltage = 121.2 How do we handle data issues? – One missing value affects all calculations – What if one of nine protocol thresholds is not met for a period of time? Is the circuit non-compliant? At what point is the ‘cost-effective, reliable, feasible’ criterion of RCW 19.285 not met? VO energy change by Simplified Protocol: 0.14 aMW (Biennial target = 0.111 aMW) VO energy change by Simplified Protocol: 0.14 aMW (Biennial target = 0.111 aMW) 12

13. 2012 Tier 2 Study Completed by SAIC, included 25 circuits Confirmed Tier 1 VO factor was too high (~30%) Reaffirmed Tier 1 finding that existing practices are very good Company’s avoided cost updated to $86.74/MWh Nine additional viable circuits identified Other circuits failed to comply with ESUE* thresholds, or had too low a benefit/cost ratio (BCR) * ESUE = Energy Smart Utility Efficiency, a Bonneville Power Administration program that includes system operational metrics for efficiency, is used in the Simplified Protocol. 13

14. Anticipated Tier 2 Projects Six circuits from Orchard Substation (Yakima, WA) – Average cost $30k per circuit – 22 phase balancing locations – One line regulator bank – Lower substation base voltages from 121 to 120 & 119 – BCR = 1.15, saving estimated 0.10 aMW Three circuits from Sunnyside Substation (Sunnyside, WA) – Average cost $68k per circuit – 4 phase balancing locations – One line regulator bank – Lower substation base voltage from 121 to 119 – BCR = 1.48, saving estimated 0.08 aMW M&V alternatives are being discussed 14

15. Washington DE Plan 2013 – Stay engaged with the industry RTF hopes to have new protocol usable by 2013 Q3 – Continue biennial pilot with Orchard T-3797 and T-5035 Consider M&V by software – No further detailed circuit studies 2014 – Implement Sunnyside T-3570 15

16. Extra Slide 16