Douglas Bowman, PE, PMP Project Manager Entergy Corporation New Projects and Processes Ensure Power Transfer for Northeast Arkansas Customers

Presentation Outline  Overview of Entergy Corporation and PMO  Current Utility Marketplace Overview  Northeast Arkansas Projects  Entergy Project Management Processes  Conclusions

The Entergy Corporation  Headquartered in New Orleans, LA  More than $10 Billion in Annual Revenues  More than $25 Billion in Assets  Major Functions – Generation Company – Transmission Company – Distribution Company – Retail Company  More than 2.7 Million customers  More than 25,000 megawatts capacity AR MS TX LA

 More than 15,000 miles of Transmission lines (69 KV to 500 KV)  Approximately 4,400 substations  Annual Capital Expenditure ($250 MM to $300 MM)  Transmission Project Challenges = High Risk  Aggressively pursuing Best Practices Entergy Transmission

Project Management Office States: (AR, LA, MS, TX)  Jurisdictional Program Managers  Project Managers

Electricity Utility Market Changes  Capital Investment Recovered Through Rate Base  Lack of Competitive Pressures  Service Area Well Defined  PSC Approved Rate Increases  Vertically Integrated Utilities  Performance Based Rates - Higher Risk, Higher Return  Effective Capital Deployment is Key  Influx of Independent Power Producers (IPPs)  Increased Project Management Involvement Regulated Market Pre 1990’s Deregulated Market

Northeast Arkansas Projects  Jonesboro CWL Upgrades  Dell 672MVA Autotransformer Addition

Jonesboro CWL Upgrades  Entergy owns, operates and maintains Transmission lines and Substation facilities  Fixed price point to point delivery of 251 MW of power over a 13 year period  Facility Study recommended 10 projects to upgrade existing transmission lines and substations

Jonesboro CWL Upgrades JONESBORO SUBSTATION Upgrade Jumpers and Relaying SEARCY PRICE SUBSTATION Upgrade Relay Capabilities PARAGOULD SUBSTATION Upgrade Switch with Associated Works ISES-NEWPORT LINE Construct 12 miles of 161KV Line MARKED TREE-HARRISBURG Rebuild 2.1 miles of 161KV Line PARAGOULD-PARAGOULD AECC Rebuild 8.3 miles of 161KV Line JONESBORO-JONESBORO SPA Rebuild 0.84 miles of 161KV Line MARKED TREE SUBSTATION Upgrade Switch with Associated Works NEWPORT SUBSTATION Add 1 Line Bay with Associated Works ISES SUBSTATION Add 1 Line Bay with Associated Works PROJECT WORK DESCRIPTION

Jonesboro CWL Upgrades

Dell Autotransformer Addition The Problem:  Existing Substation with 1 autotransformer  Voltage instability results with loss of existing transformer The Solution:  Install 672MVA Transformer to Ensure Continued Service for Northeast Arkansas

Project Management Processes  Project Execution Plan (PEP)  Scheduling  Estimating  Risk Management  Issue Management  We’re getting better as we go.

The Project Execution Plan is a document the defines the process for the project: SCOPE What we have to do? PLAN How we are going to do it? CONTROL How are we going to measure that we are accomplishing our scope and working our plan? PEP Defined

General Components of the PEP Plans Controls Scope of the Projects Safety Plan ROW, Environment, Legal Plans Communication Plan Construction Plan Contracting Plan (Resource Plan) Risk Management Plan Etc. Quality Management Plan Project Controls Plan Responsibility Assignment Matrix Problem Project Purpose/Goals Alternatives & Proposed Methodology Type of Project & Justification ISD/Milestones Preliminary Cost Estimate Policies/Standards/Procedures Success Factors Etc.

Scheduling

Risk-Weighted Cost Estimating Process Review Estimate and Baseline Conduct Risk Ranging Session Determine Contingency & Contingency Drawdown BOE Documentation Prepare Cost Estimate

Contingency = Budget - Base BaseBudget Mean Cost ($x1000) Probability Using Results to set Contingency

Contingency funds are not tied-up for the duration of the project. As predefined milestone dates are safely met, the appropriate sums are drawn out from the Contingency fund Jan March Jun Sept Time Contingency (X$1000 ) * * * Typical Contingency Drawdown Curve

Track Plan COMMUNICATIONS Contingency Funds were used to Support Mitigation Tasks Continuous Issue and Risk Management

Issue Management Form 1. Submission of Project Issue (PI) PI Tracking No.: Project Title: Work Order#: Funding Project#: Jurisdiction: Project Issue: Submitted by: Date: 1. Project Team Evaluation Project Impact: Issue Type: Action Type: Issue Only Change Risk Process Variance Evaluate Communicate Create Plan/Mitigate Monitor Escalate No Action Required Approving Authority: Change Requirement: PM PGM CCB Director VP Customer Adjust Cost Adjust Schedule Adjust Scope Other Comments: Project Manager Signature: Date: 1. Authority’s Action Approved Rejected Documentation Comments: Approve Signature: Date: 1. Lessons Learned

Submission of Issue Management Form PI Tracking No.: CEA #- Year – CEA Tracking Sequence Number –TL –TL Project Title CEA# Jurisdiction Submitted by & Date

2. Project Team Evaluation Issue Type: –Issue Only –Risk –Change –Variance Action Type: –Evaluate –Create Plan –Escalate –Mitigate –Monitor –Ignore Project Impact

3. Action Take Approving Authority: –PGM –CCB –Director –VP Approving Authority: –PGM –CCB –Director –VP Change Requirement: –Adjust Cost –Adjust Schedule –Adjust Scope Change Requirement: –Adjust Cost –Adjust Schedule –Adjust Scope Authority’s Action: –Approved –Rejected –Need More Info. Authority’s Action: –Approved –Rejected –Need More Info.

4. Lessons Learned Project Team Recommendations Project Manager Signature

Conclusions  Customers in Northeast Arkansas will have reliable delivery of electric power  Entergy Projects are well suited for PMI processes  Entergy is actively pursuing and applying best practices