Dynamic Scheduling Overview Joint Initiative Dynamic Scheduling Overview Integration Meeting Notes December 10, 2008

December 10th Integration Meeting Participants In Person: Jerry Smith, APS Tim Smith, BPA Patrick Damiano, ColumbiaGrid Jon Kaake, ColumbiaGrid Kristi Wallace, ColumbiaGrid Joe Taylor, Excel Energy Jeff Atkinson, Grant County Colin Persichetti, PacifiCorp Kathee Downey, PacifiCorp JJ Jamison, Portland General Charlie Reinhold, WestConnect Via Conference Call: Frank Temple, Grant County Sharon Helms, NTTG Ray Brush, Northwestern Jim Hanson, Seattle City Light 10/23/2008

ISSUES and RESPONSES Issue: Before the hour dynamic scheduling would tie up firm transmission that may or may not be called upon. Net result is increasing the transmission constraint problem and is not a product that merchants would use. If able to access within the hour it creates a very strong product for the region and optimizes the transmission. Response: The design is for a system that provides dynamic scheduling capability at any level of granularity. Commercial decisions say with the LSE. Transmission will need to be acquired, but only for an hour or less, depending upon the schedule. Today the schedule period is one hour, but if that period is shortened, the design already accommodates it. Static dynamic schedules typically tie up firm transmission on an annual basis. This system should allow maximal utilization of the transmission grid.

ISSUES and RESPONSES Issue: Consider taking steps to ensure there are no regulatory concerns with product/design Response: The FDS helps with integration of renewable resources and helps break the current monopoly on transmission. FERC should view this as a benefit to the region. An informal visit with FERC staff prior to initiating implementation activities is being considered (similar to the ADI approach).

ISSUES and RESPONSES Issue: Currently NERC requires a firm transmission reservation for dynamic scheduling. It would be helpful to be able to utilize non-firm or conditional firm with this product. Response: Noted as a potential issue requiring follow up. Jim Hansen will raise the issue with the NERC IS and NERC JISWG groups.

UPCOMING MEETINGS Date Workgroup Location and Time December 18th Infrastructure Technical Workgroup Web and Phone conference 1:00 p.m. – 3:00 p.m. January 6th and 7th Products and Services Workgroup Meeting San Diego, CA TBD January 8th Joint Initiative Think Tank (Public Stakeholder) Meeting 10:00 a.m. – 4:00 p.m. January 29th Joint Initiative Integration Meeting Portland, OR

Dynamic Scheduling Overview Joint Initiative Dynamic Scheduling Overview Integration Meeting Presentation Materials December 10, 2008

Scope Create communication link(s) and associated data protocols to support the sale and next hour delivery of dynamic energy products (e.g., regulation) The protocol will use existing transmission service products, as available, and existing scheduling processes to the extent practical. The technical design will accommodate many product types, but product development is out of scope

Out of Scope Development of products Development of a market or bi-lateral trading board Tariff changes Creation of intra-hour etags (if developed elsewhere, design will accommodate them with necessary lead time)

Dynamic Scheduling Operational Rough Timeline Draft Technical specs completed Mid Dec 08 Feb 09 Business Case Complete and Contract Offered Initiate Implementation Apr 09 Dynamic Scheduling Operational October 09

Design Objectives Voluntary participation Ability to accommodate any product design Provide scalability Modular component design Minimize barriers to participation Keep it simple Leverage existing infrastructure and practices, where possible

Fluid Dynamic Scheduler (FDS) Overview

High Level Design Overview After the Scheduling Period FDS Updates e-Tag with the correct integrated quantity During the Operating Hour Uses composite e-Tag data to distribute MW requests to BA’s Before the Scheduling Hour PARTICIPANTS Strike a deal and create dynamic e-Tag

Before the Scheduling Period Populate FDS with physical capacity schedules using approved dynamic e-Tags Set e-Tag transmission allocation to the maximum quantity that can be requested Set the energy profile to the expected integrated MWh quantity Create E-Tags Manually by an e-Tag agent service, or Automatically from PSE’s scheduling system, or Automatically, as a result of a bidding process

Before the Scheduling Period E-tags can be coded (in the misc info field) to reflect any information required to correctly distribute the real-time energy request The e-Tag will reflect curtailments prior to the scheduling period; FDS will receive and incorporate approved e-Tag adjustment requests Each participating BA calculates its total combined reserve obligations and resources for future hours from the e-Tag data or their own scheduling system

During the Scheduling Period FDS will manage the composite set of capacity transactions between participants FDS and participants will exchange real-time data FDS will provide each BA with a total combined real-time reserve obligations and resources The e-Tag will be used to implement curtailments during the scheduling period; FDS receives approved e-Tag adjustment requests distributes real-time energy response requests to participants with obligations based on criteria determined by the participants ensures that all requests meet any constraints described in the e-Tag adjustment

During the Scheduling Period Participants respond to requests for energy with a signal indicating delivered energy quantity are obligated to deliver up to their maximum obligation as specified in their contracts. In the event of failure to respond, the FDS will allocate the request to the next available BA with remaining obligation to the requestor. log this decision and also continue monitoring the non-responding BA for a response and switch back accordingly.

After the Scheduling Period Within one minute after the operating hour, FDS will update e-Tags with integrated MWh quantities. FDS and the updated e-Tag will be the source of data for settlement purposes Parties may not deny these e-Tags based on differences between their own integrated calculation and the FDS integrated calculation FDS contains and calculates the definitive MWh quantities. These quantities will also be reflected in the WIT

Next Steps Determine if aggregating/allocating signals triggers any regulatory issues Define e-Tag and ICCP data requirements Define allocation algorithm options and determine if a user interface is desired Work with TP’s to identify signal requirements associated with distribution of flow data to intermediary TP’s

QUESTIONS?