Pilot Project Phase In Status

1

• Pilot Project Phase In Status
• ERCOT has been following the May 15 Pilot Project
  phase in schedule
• May 25 Commercial Power System Data
  Acquisition
• June 1 Retail Operations
• June 8 Aggregation Power System Analysis
• June 11 Market Trials Begin
• July 6 Single Control Area Commercial
  Operations
• We have met these dates for the most part, but
  some functionality is not yet at the level needed
  for reliable single control area operation on
  July 6

2

• Functionality Needed For Full
• Pilot Project Implementation
• An exact go/no go check list under a time
  constraint is not feasible!
• However, we can identify the basic functionality
  needed
• Customer switching
• ESI database maintenance
• Customer usage processing (meter reads)
• Resource metering
• Load forecasting
• SCADA and network analysis
• Market requirements publishing A/S, losses, etc
• Outage scheduling

3

• Basic Functionality needed
• (continued)
• Energy scheduling
• Balancing energy and A/S bidding
• Market solutions and notifications to QSEs
• Power system operations balancing, regulation,
  congestion clearing
• Settlement
• Statements
• Go/No Go decision is subjective to some extent as
  there will be work arounds
• Showstoppers must be honored!!!!!

4

• Showstopper Concerns
• Overall system stability still up down
  prevents complete end to end testing getting
  bids and solving just cannot yet keep it going
• Performance issues with Market (MOS) and Power
  (POS) Operating Systems database
• Fixes and upgrades to MOS and POS still take down
  both systems
• Fail over at Austin site not yet proven

5

• Major Concerns
• Not Showstoppers
• Transaction clearing house performance issues
  ESI database and customer usage too slow may
  not be at full volume by 7/2
• QSE notification operating systems sending out
  too many notices category 1 notification being
  addressed
• Congestion management ESCA network modeling not
  yet working adequately, but we can use a
  temporary work around
• Settlements expected to be ready with
  workarounds, but depends on MOS/POS data being
  available

6

• Other Issues
• Minimum number of QSEs to convert to single
  control area how many must be ready
• QSEs have little opportunity to test their
  systems
• QSE redundancy loss of a large QSE can cause
  significant financial impact to others in the
  market
• Ad Hoc work groups proposed changes must go
  through the Subcommittee/TAC/Board process
• Phase II schedule/cost will not be ready, as
  some entities anticipated, on 7/1

7

• Next Steps
• Friday 6/22 Decision on go/no go for 6/26
  start of cutover
• If we go into cutover we will decide by 6/29 on
  go/no go for full single control area cutover
  on 7/6
• If we do not go into cutover on 6/26 the decision
  to start the cutover process will slide day to
  day until the vendors resolve the showstopper
  issues. The cutover process schedule will then
  not be compressed, just slide the same number of
  days