1. 1 2007 ACC Summer Preparedness Hearing Tucson Electric Power & UNS Electric March 22, 2007 Ed Beck Superintendent Transmission & Distribution Planning Leland Snook General Manager Wholesale Energy Supply

2. 2 Service Territories San Juan Navajo Palo Verde South Vail Greenlee Cholla Mohave Mead Four Corners Springerville McKinley Tortolita Westwing Coronado UES TEP Tucson Liberty Pinnacle Peak

3. 3 AZ Power Plant Additions

4. 4

5. 5 2007 Generation Resources TEP Generation Resources (MW) Steam Generation - Coal69% 1,525 Steam Generation - Gas12% 267 Combined Cycle - Gas9% 187 Combustion Turbine - Gas10% 217 Total Generation Resources (MW) 2,196 Market Based Resources (MW) TriState Generation and Transmission – Firm PPA 100 Firm Short-Term Purchases 250 Spot Market Resources 250 Total Market Resources (MW) 600 Total Generation & Market Based Resources (MW) 2,796

6. 6 2007 Peak Demand Loads and Resources

7. 7 2007 Generation Preparations

8. 8 UNSE Loads & Resources UNSE under full-requirements contract through 5/31/2008. Load and resource summary provided in APS presentation. UNSE has been and continues to procure generation resources through resource acquisition and quarterly request for proposals To date 100 MW of capacity under firm PPA contracts for Summer 2008 90 MW of capacity under construction at Black Mountain Generation Station located outside Kingman 67 MW of capacity at Valencia Generating Station in Nogales

9. 9 Tortolita South Vail Greenlee Westwing TEP Service Area 500 kV 345 kV North Loop Irvington Voltage With Max Local Gen. Limit of 1,984 MW TEP Import Paths Local Gen. 547MW 83 44 420 DMP Winchester

10. 10 Operations preparation Regional black start drills between control areas currently taking place Verification of TEP’s Emergency Operations Center (EOC) readiness scheduled in April 2007 Weekly check of EOC systems occurs Daily conference call between reliability coordinator and control area operators to review system conditions During summer peak AZ entities hold daily reliability call New radio system deployed since last summer

11. 11 Distribution Preparations Review and adjust Power Factor as needed Installation of mobile transformer to support the Vail area of TEP service territory until new 138kV substation is developed

12. 12 UNS Electric Transmission Mohave – Transmission from Pinnacle West Delivery points to UNS loads is provided by Western Area Power Santa Cruz load is served at peak with a combination of firm Western transmission and non-firm transmission supported by local generation at Valencia

13. 13 UNS Electric System – Santa Cruz Installed remote control switch at Canez substation to allow for operational flexibility Pre- storm season patrols completed with no major items identified for repair

14. 14 UNS Electric System – Mohave Installed 2 new Distribution Substations 12 miles of new 69kV line installed 14 miles of new 230kV line (initially operated at 69kV) Pre- storm season patrols completed with no major items identified for repair

15. 15 Conclusion Sufficient Resources are available to meet TEP load Sufficient Transmission is available to meet TEP load Sufficient Transmission is available to meet UES Mohave load Transmission in conjunction with local generation is sufficient to meet Santa Cruz load