Big Stone II Study Update SPG Meeting October 19, 2006

Presentation Overview Summary of September 18 MAPP DRS Mtg. Interconnection Study Delivery Service Study Phase 5 Summer Off-peak Analysis Model Assumptions Results Upcoming Schedule

Recap of Sept. 18 DRS Mtg. Interconnection Study Presentation given to MAPP DRS Discussion led to conditional approval of the IC study with 4 follow-up items: Verify ND Load Levels in Stability Models Arrowhead-Weston 345 kV Stability Sensitivity Resolution of local stability issues Update DRS once transmission option selected by the MN PUC

Recap of Sept. 18 DRS Mtg. Delivery Service Study Presentation given to MAPP DRS Discussion led to identification of 4 follow-up items before DRS will take action on study. Finish Phase 5 analysis (Summer off-peak study) Prior outage analysis of Phase 3 models Deeper explanation of flowgate analysis Identify fixes for delivery related issues (revise motion)

Phase 5 – Summer off-peak High Simultaneous transfer case Phase 5 only for DRS review. Submitted to the DRS on Sept 29th for review at the November 2nd meeting Not part of MISO submittals

Technical Scope This phase is steady state only Base case is 2006 summer off-peak case from the NMORWG package with: MHEX South = 2175 MW NDEX = 1950 is base case – raised with Big Stone II MWSI = 1480 MW prior to Arrowhead – Weston in service. Maintained at such level prior to Arrowhead – Weston throughout study. Since this case has maxed out interfaces, the model does not reflect existing firm commitments. Baseloads within NDEX @ URGE Load within NDEX approx @ 70% NMORWG TITLE: URG-S7006AA.UZVV424.SAV

Powerflow model additions Added some new topology: Split Rock – Nobles Co. – Lakefield 345 kV Lakefield – Fox Lake 161 kV #2 Arrowhead – Stone Lake – Gardner Park 345 kV Series Compensation of Lakefield – Wilmarth 345 kV Upgrades associated with Council Bluffs 4 and Nebraska City 2 Other miscellaneous model changes in addition to this

Study BSP II output sunk to generation similar to that of Phase 3 and 4 of the Delivery Study One scenario for each of the two interconnection alternatives studied.

Results Thermal overloads observed, and impacted above 2% DF: Big Stone – Blair 230 kV. Loaded between normal and emergency rating Granite Falls 230/115 kV xmfrs Aurora – Brookings 115 kV Arlington – Watertown 115 kV Brookings – Watertown 115 kV McLeod 230/115 kV xfmr Granite Falls – Morris 230 kV Morris 230/115 kV xfmr Watertown 345/230 kV xfmr Johnson Jct. – Ortonville 115 kV Grant County – Hoot Lake 115 kV

Results - continued Part of this study is to identify if TTC of interfaces would be reduced because of this project. Note that the model is not reflective of firm commitments. Two of the thermal issues seen is part of the current NDEX interface definition: Big Stone – Blair 230 kV Morris – Granite Falls 230 kV No new steady state voltage concerns observed. Discussion on what the constraints that will have to be mitigated will be held at the DRS meeting.

Upcoming Schedule November 2 DRS Mtg. December 7 DRS Mtg. Discuss Phase 5 Analysis December 7 DRS Mtg. Discuss Remaining Follow-Up Items December 31 Draft IA MISO Approval of IC Study January 2007 Begin Phase 6 Analysis Sensitivity to EHV line and other regional transmission projects