© 2016 Portland General Electric. All rights reserved. PGE Smart Grid Road Map Public Meeting – UM 1657 Date: March 15, 2016 Bill Nicholson, Sr. Vice President, Customer Service, Transmission & Distribution Carol Dillin, Vice President, Customer Strategies & Business Development Larry Bekkedahl, Vice President, Transmission & Distribution

2 Follow up on information requested at PGE’s 2015 Smart Grid Report presentation to the OPUC: Source: Docket No. UM 1657, Order No Purpose of Today’s Discussion Portland General Electric Company should provide an interim update on its efforts to develop a vision and road map as part of its 2016 Smart Grid Report at a Commission workshop.

3 72 MW DC PV on distribution system Current Landscape 717 MW Wind Generation 1.25 MWh Available Energy Storage 13 MW / 105 MW Enabled Demand Response & Dispatchable Standby Generation 76% Substations SCADA-enabled 75 / 0.48 Reliability: SAIDI / SAIFI* 7,000 EV in service territory 865 Public EV Charging Stations *2015 – Excluding Major Event Days

4 72 PV on distribution system One View of the Future 717 Wind Generation 1.25 Available Energy Storage 13 / 105 Enabled Demand Response & Dispatchable Standby Generation 76% Substations SCADA-enabled 75 / 0.48 Reliability: SAIDI / SAIFI* 7,000 EV in service territory 865 Public EV Charging Stations *2015 – Excluding Major Event Days Over 220 MW DC 100, % Over 2,000 MW 100 MWh 6,500 < 75 / MW / 150 MW

5 Existing Foundation

6 Smart Grid Foundation & Efforts Under Way AMI Meter Deployment > 850,000 customer meters installed Grid Modernization Asset management strategy Communications Upgrades Spectrum procurement & infrastructure modernization Customer Programs/Pilots DSG, Energy Partner, Smart Thermostat, Flex GIS, OMS, EMS Deployed CIS & MDMS in flight Analytics Capabilities T&D Analytics Pilot, Energy Tracker T&D Pilots Underway CVR, DA, Synchrophasor Salem Smart Power Center 5MW battery testing facility

7 Our Strategic Approach Model & Monitor EngageIntegrate PGE will advance the intelligent and integrated operation of our grid by leveraging technologies that deliver customer value and system benefits in a changing landscape Model & Monitor: leverage industry & customer trends, data, policies, and system modeling, to plan ahead by identifying potential pilots, demonstrations and programs Engage: incorporate customer and stakeholder feedback as we start small in our deployment and testing of new technologies and programs Integrate: build upon our foundation as we move to scale on proven technologies that drive new customer value

8 Model & Monitor (Plan Ahead) Engage (Successfully Pilot) Integrate (Move to Scale) Monitor Industry Landscape Microgrid market assessment Emerging Technologies Energy storage* (HB 2193) Electric vehicle smart charging/DR Smart water heaters Potential Studies Demand response potential* Real Time System Analysis Integrated Resource Plan Pilots Energy Partner* Smart Thermostats* Pricing pilot* Conservation Voltage Reduction* Distribution Automation Salem Smart Power Center Communications Upgrades Strategic Asset Management T&D Analytics Programs Smart meters Energy Tracker Energy Expert Dispatchable Standby Generation* Smart Grid Initiatives: Current Status (2015) 123 *Evaluating in partnership with Integrated Resource Planning

9 Model & Monitor (Plan Ahead) Engage (Successfully Pilot) Integrate (Move to Scale) Monitor Industry Landscape Emerging Technologies Potential Studies Real Time System Analysis Integrated Resource Plan Pilots/Research Electric vehicle smart charging/DR Smart Water Heaters Microgrids Systems Distribution management system Programs Smart meters Energy Tracker Energy Expert Dispatchable Standby Generation Demand Response Pricing Portfolio Conservation Voltage Reduction Distribution Automation Strategic deployment of distributed storage Strategic Asset Management T&D Analytics Communications network Smart Grid Initiatives: 2020 View 123

10 Roadmap

11 Roadmap has been categorized based on each initiative’s primary value:  Foundation  Grid Optimization  Customer Engagement Road Map Structure

New Systems Deployed & Integrated Outage Management System, Geographic Information System AMI Fully Deployed Expansion of Analytics Capabilities T&D Analytics Pilot Advanced Grid Analytics Expanded Utilization & Use Cases Energy Information Systems (EIS) Integrated Energy Tracker Energy Expert T&D Tools Deployed & Integrated Energy Mgmt. System State Estimator, Real-time Contingency Analysis Tool Engage: Successfully Pilot Integrate: Move to Scale Legend: Model & Monitor: Plan Ahead ReplacementSoft Launch Description: Hardware and software that Enable deployment of smart grid initiatives Allow customers to realize maximum value of smart grid initiatives Improve system cybersecurity Communications Pilots Spectrum and infrastructure modernization Continuous Communications Upgrades Strategic expansion of infrastructure modernization at all substations Hardware Software Smart Grid Roadmap: Foundation Goals: Ensure all necessary hardware and software is in place to enable effective deployment of smart grid initiatives Considerations: Timelines are approximate and contingent on project funding, viability, and necessary regulatory approvals. Schedule will change as necessary. Distribution Management System (DMS) Use Case Evaluation Potential DMS Procurement 125 Years of Innovation: For more than 125 years, we’ve been modernizing our grid and building one of the most reliable systems in the country. CET Customer Touch Points Project Customer Information & Meter Data Management Systems Build/Design/Test Launch

Smart Grid Roadmap: Grid Optimization Engage: Successfully Pilot Integrate: Move to Scale Legend: Model & Monitor: Plan Ahead Strategic Deployment of SCADA (Supervisory Control and Data Acquisition) and Substation Automation (Automated Switching & Protection Schemes) At new and existing substations as a part of system upgrades or risk reduction efforts Distribution Automation Pilots Develop standard specification Strategic Deployment of Distribution Automation Investment designed to reduce system risk Synchrophasor Pilot At 3 Substations Synchrophasor Deployment Deployment at additional substations Distribution Fault Detection PilotStrategic Deployment of Fault Circuit Indicators on Distribution System Deployment at 10 additional substations Automation & Control Situational Awareness Assess Utilization of DERs for T&D Risk Reduction Locational Distributed Energy Resources Pilot Description: System hardware, tools, and customer programs that automate processes and improve situational awareness to reduce system risk and improve reliability of the transmission & distribution networks by: Improving restoration time Avoiding outages Informing investment & design Goals: Maintain and improve high-level of reliability despite changing conditions on grid (i.e. penetrations of DERs, RPS, etc.): Expanding SCADA to 100% of substations Improve reliability metrics Reduce system risk Expand CVR deployment 5 MWh Energy Storage Deployed Considerations: Timelines are approximate and contingent on project funding, viability, and necessary regulatory approvals. Schedule will change as necessary. Substation Remote Access Server Operational Efficiency Cyber Security Communications Pilots Potential Customer Smart Inverter Pilot Deployment Smart Inverter Planning/Standard Development Monitor UL1741 & IEEE1547 Anticipated involvement in OPUC workshops Strategic Deployment of CVR Deployed where feasible and necessary to meet IRP goals Conservation Voltage Reduction Communications & analytics pilot Salem Smart Power Center Use Case Demonstration Storage Planning (House Bill 2193) New Storage Procurement Storage inte- grated into asset mix

Smart Grid Roadmap: Customer Engagement Engage: Successfully Pilot Integrate: Move to Scale Legend: Model & Monitor: Plan Ahead Demand-Side Management Smart Thermostat Pilot Nest Rush Hour Rewards Smart Thermostat Program Possible expansion beyond Nest and inclusion of other smart devices & customer classes Firm Load Reduction Program (Curtailable Tariff); C&I Curtailable Tariff Curtailable Tariff Flex Pricing Pilot Test and evaluate residential Behavioral Demand Response (BDR), Time-of-Use Rates (TOU), Peak Time Rebates (PTR) Flex Program Most effective options scaled Product Development Distributed Standby Generation (DSG) Continuous Program Growth Energy Partner ProgramEnergy Partner Pilot Microgrid (MG) Demonstration Storage Planning (House Bill 2193) Potential Storage Customer Pilot Storage/MG Customer Program Description: Customer programs and grid resources that save customer money by: Enhancing the ability to integrate renewable resources and distributed generation Promoting wise and efficient use of energy Increasing capacity utilization on existing assets Enabling integration of smart devices Goals: Develop an effective portfolio of demand-management and grid resources to effectively optimize new and existing system resources. 74 MW of customer-enabled demand response by MWh Energy Storage Deployed Considerations: Timelines are approximate and contingent on project funding, viability, and necessary regulatory approvals. Schedule will change as necessary. Microgrid Planning New Smart Water Heater Standard New communications socket on all new water heaters BPA Smart Water Heater Research & Demonstration Project Test the technology (~100 customers) Water Heater ADR Program Mass Market Water Heater Demand Response Pilot Development Mass Market Water Heater Automated Demand Response (ADR) Pilot Electric Vehicle Charging Ancillary Services R&D EV Smart Charging & Rate PilotEV Smart Charging Research Project & EV Rate Planning EV Smart Charging & Rate Program Electric Vehicles

15 Road Map Example: Smart Thermostat DR Model & Monitor (Plan Ahead) Engage (Successfully Pilot) Integrate (Move to Scale) Technology evaluation Research and planning Pilot design Define resource strategy Deferral (UM 1708, Order No ) Demonstrate measurable success Evaluate customer satisfaction Program evaluation (Demonstrate cost- effectiveness) Expand to all residential customers Possibly expand to other thermostat vendors Possibly integrate with other smart devices Possibly expand to other customer classes Smart Thermostat Program Model & MonitorSmart Thermostat Pilot Timeline:

16 Looking Forward  PGE has built a strong foundation and is well-positioned to take advantage of smart grid technologies which benefit our customers.  We will continue to model & monitor the industry landscape and engage our customers as we plan for and evaluate new technologies.  A sound business case is essential for future smart grid programs. Pilots may be used to demonstrate the value of potential programs before scaling up.  Our goal is to maximize the opportunity of new technologies, while avoiding unnecessary costs and risks. We want to be among the first, not the very first!  We will modify our road map as appropriate to ensure prudent and timely integration of smart grid initiatives.

17 Questions