1. October 6, 2006 Public Stakeholder Review Portland, Oregon Conditional Firm

2. Meeting Objective and Agenda Objective: Initiate a collaborative process to identify opportunities, issues and solutions to PacifiCorp’s offering of a conditional firm product Agenda: Discuss goals for implementation of a conditional firm product Discuss proposed process for stakeholder input and product formulation Review historical compilation of PacifiCorp system schedules Discuss concerns with product implementation and possible remedies

3. Commitment MEHC and PacifiCorp will support the Bonneville Power Administration in its development of short-term products such as conditional firm. No less than three months following the close of the transaction, PacifiCorp will initiate a process to collaboratively design similar short-term transmission products and will include stakeholders in this process. On June 16, 2006, PacifiCorp provided notice describing steps it will take to comply with the merger commitment Conduct a review of operational and technical requirements necessary to offer service Conduct a historic firm contract schedule and flow audit of specific commercial paths Schedule stakeholder meetings PacifiCorp will make every reasonable effort to complete a product by the end of 2008.

4. Process Overview/Timeline Stakeholder/Customer meetings Portland – October 6 Salt Lake City – October 23 Comment submittal - via PacifiCorp internet (Q4 2006) PacifiCorp review of comments and proposed product description (Q4 2006) Publish schedule for additional public meetings (January 2007) Review of FERC 888 NOPR Reform Order (Q1 2007) Final comment session (via electronic public forum) (Q2 2007) Product analysis, finalization, and FERC filing process (Q4 2007)

5. Conditional Firm Goals and Guiding Principles Goals Optimize the use of existing transmission system Increase product flexibility for customers Guiding Principles for Product Development Maintain reliability of transmission system Avoid diminishing firm rights to existing network and PTP customer contracts Avoid cost shifts between customers or customer classes Limit economic risk to other transmission customers

6. Current PacifiCorp Products/Services PacifiCorp OATT Network Integration Service Point to Point Firm  Long term (greater than one year) Partial Firm (seasonal, or as allowed by capacity)  Short term Non-firm

7. PacifiCorp System Specifics PacifiCorp system specifics Many paths are scheduled near capacity a high percentage of time High usage long term schedules are not always “grouped” in specific seasons or months Limited ability to re-dispatch thermal generation Network load increasing at fast rate Limited ability to accurately forecast load growth over long term

8. Elements of Current Proposed BPA Conditional Firm Product Only available to customers requesting long term firm Point to Point service where ATC is determined not to be available for at least one month in a twelve month period Maintains original long term firm queue position Firm for specified months (when ATC is available) Curtailment Pro Rata with all other firm Conditional firm in months where ATC is not available Conditional firm hour limits fixed at contract initiation (either annual or monthly limits) Curtailment priority Before all firm After all Point to Point non-firm Tagged as “Network – Non-Firm” - NERC curtailment priority 6

9. BPA Proposed Curtailment Position ProductNERC Curtailment Priority PTP Secondary 1 Hourly NF 2 Daily NF 3 Weekly NF 4 Monthly NF 5 Network NF 6 Firm 7 Conditional Firm

10. Concerns with BPA Conditional Firm Proposed Product Design Network upgrade cost allocation Queuing position Queue blocked by un-resolved long term firm requests Limited ability to forecast native load growth to determine hourly curtailment limits Transmission provider and other firm customers take all risk of congestion occurring over forecasted limits

11. Historical Examples of Firm Schedules on PacifiCorp Paths

12. PACE - FC3 (TOT-2B-1)

15. PACE – GLC2 (TOT-2B-2)

18. WYOE – TOT 4A

21. WYOE – TOT 4B

24. PACEW – PACE (Monument – Naughton)

27. PacifiCorp Conditional Firm Product Alternative 1 Conditional firm with transmission customer arranging re-dispatch for congested periods Schedules would be firm - customer responsible to arrange their own re-dispatch to alleviate congestion If re-dispatch is not completed upon congestion per agreement, then schedule will transform to a non-firm tag subject to curtailment Benefits Allows greater utilization of transmission system Limit economic risk to other transmission customers Protects existing rights of other network and firm customers (check) Concerns Transmission customer curtailment hours not limited Transmission customer takes risk of marginal prices of redispatch May not be a long-term solution

28. PacifiCorp Conditional Firm Product Alternative 2 Bridge product Initial schedules would be firm with committed-to hourly curtailment limits by PacifiCorp Network upgrades to allow firm service per current PacifiCorp OATT Product duration would be subject to Network Upgrades being completed on timely basis No rollover – Service would transfer to firm after Network Upgrades are completed per current OATT provisions Benefits Allows for transmission usage while network upgrades are under construction Limits economic risk to other transmission customers Protects existing rights of other network and firm customers Concerns Cost of network upgrades may preclude implementation

29. PacifiCorp Conditional Firm Product Alternative 3 Two (existing) product approach Utilize existing partial firm product for un-congested months Utilize existing non-firm product for higher usage months Arrange LT firm via Network Upgrades, and transfer service to LT firm after Network Upgrades are complete Benefits Limits economic risk to other transmission customers Protects existing rights of other network and firm customers Allows for transmission usage while network upgrades are completed Concerns Transmission customer curtailment hours not limited

30. Next Steps Submit comments to PacifiCorp by December 10, 2006 CFDevelopment@pacificorp.com All comments and replies will be posted on PacifiCorp’s web portal http://www.pacificorp.com News and Info  Conditional Firm Development Publish schedule for additional public comment sessions by January 10, 2007